CAPE Engineers Collaborating With Advance Nanotech Receive Prestigious Grant for Work in Ultrafast Photonics Devices.

NEW YORK -- UK Engineering and Physical Sciences Research Council Grants $163,700 for Developing Ultrafast Laser, Optical Networking and Interconnect Devices

Advance Nanotech, Inc., (OTCBB:AVNA), the premier provider of financing and support services to expedite the commercialization of nanotechnology discoveries, today announced the United Kingdom's Engineering and Physical Sciences Research Council (EPSRC) has awarded a grant of $163,700 (GBP 89,000) to engineers of the Center for Advanced Photonics and Electronics (CAPE) at the University of Cambridge working with Advance Nanotech on the development of carbon nanotubes for photonic applications. The research and the technology under development enables the creation of ultrashort laser pulses and the regeneration of optical signals in high data rate systems and could significantly reduce the cost of doing business across a broad range of industries. These include computer servers and telecommunication applications to medical diagnostics, biomedical research, material marking, drilling, processing and inspection. The grant follows the research team's demonstration of the first working prototype of a new ultrashort pulse laser and acknowledges both the scientific and commercial merits of the project, as was announced by Advance Nanotech on March 13, 2006.

This grant is the second awarded to the carbon nanotubes for photonics project by EPSRC. In 2004, before Advance Nanotech partnered with CAPE on this project, EPSRC awarded a grant of $467,500 (GBP 247,000) to help fund the first phase of the project. The additional grant has been awarded to complete key enabling steps for the commercialization of the carbon nanotube-based technology. These include securing intellectual property rights; initiating interactions with laser and material manufacturers; and identifying key product requirements such as time to market, productions costs, and technical specifications.

"The EPSRC funding will enable our team to develop fully packaged demonstrators that will showcase the potential of our technology while meeting the technical requirements of the industry leaders across a range of application sectors," said Dr. Andrea Ferrari, one of the leading scientists on the development team. "Advance Nanotech's guidance will be crucial in identifying and prioritizing suitable target applications and defining our market entry strategy."

Components of the laser under development are compact and employ only a tenth of a milligram of Carbon NanoTube (CNT) material at a cost of about ten cents per device. The manufactured components are extremely cost competitive and their integration in optical and photonic circuits is much less labor intensive compared to existing technologies since the new class of nanomaterials-based components require almost zero alignment. The technology could initially target ultrashort pulsed lasers such as mode-locked lasers. The EPSRC's funding, which is designed to turn research outputs into commercial propositions, acknowledges the commercial potential of the technologies and will allow significant progress towards its full expression.

Advance Nanotech's investment in the ultrafast laser project was made in partnership with CAPE, the Center for Advanced Photonics and Electronics, at the Department of Engineering of the University of Cambridge. CAPE is an integrated Research Facility for Electrical Engineering with a staff of 20 academics, 70 post-doctoral researchers and 170 research students. CAPE is funded by Advance Nanotech, Alps Electric Company Limited, Dow Corning Corporation, and Ericsson Marconi Corporation, and is designed to encourage research activities to proceed to development and exploitation in close collaboration with industry. The program enables designers and engineers within academia and industry to benefit from the burgeoning developments in advanced photonics and electronics. In the past five years, numerous patents have been filed and ten spin-out companies have been formed from projects which began in the Electrical Division within Cambridge's Department of Engineering.

Advance Nanotech is currently funding 20 nanotechnologies in the electronics, biopharma, and materials industries. The firm provides services ranging from funding, to human capital and research equipment essential to ensuring that the most promising companies can accelerate the path to rapid commercialization. In this way, investor exposure to any particular technology is mitigated with Advance Nanotech retaining the option to increase investment in those technologies that successfully mature.

About Advance Nanotech, Inc.

Advance Nanotech is dedicated to the successful commercialization of disruptive nanotechnologies to produce nano-enabled products. Advance provides financing and support services including commercialization guidance, project and infrastructure management, leadership assets, and counsel on intellectual property, licensing and regulatory issues to ensure maximum market potential. Advance Nanotech's diversified portfolio of over 20 nanotechnologies impacts a range of applications, including, but not limited to sensors, medical therapeutics and composites. Advance is forging partnerships with leading manufacturers and universities in Europe, Asia and North America to transform innovative nanotechnology concepts into practical solutions.

About the Engineering and Physical Sciences Research Council (EPSRC)

The Engineering and Physical Sciences Research Council (EPSRC) is the UK's main agency for funding research in engineering and the physical sciences. The EPSRC invests more than GBP 500 million a year in research and postgraduate training, to help the nation handle the next generation of technological change. The areas covered range from information technology to structural engineering, and mathematics to materials science. This research forms the basis for future economic development in the UK and improvements for everyone's health, lifestyle and culture. EPSRC also actively promotes public awareness of science and engineering. EPSRC works alongside other Research Councils with responsibility for other areas of research. The Research Councils work collectively on issues of common concern via Research Councils UK. Website address for more information on EPSRC: www.epsrc.ac.uk.

About the Department of Engineering, University of Cambridge

The Department of Engineering is the largest department in the University of Cambridge, representing approximately 10% of the University's activities by the majority of common metrics, and is one of Europe's largest integrated engineering departments. It achieves the highest standards in both research and teaching. Its international reputation attracts the best students, academics, sponsors and partners from around the world. More details about the Department and the latest news can be found on its website at www.eng.cam.ac.uk.

This document contains forward-looking statements by Advance Nanotech regarding its expectations as to its business, and involves risks and uncertainties and may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Such statements are based on management's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those addressed in the forward-looking statements.

Factors that may cause such a difference include, but are not limited to, problems and risks associated with developments in the nanotechnology industry in general and in Advance Nanotech's products under development in particular; the potential failure of Advance Nanotech's products under development to prove safe and effective in application; uncertainties inherent in the early stage of Advance Nanotech's products under development; failure to successfully implement or complete research programmes; failure to receive marketing clearance from regulatory agencies for our products under development; acquisitions, divestitures, mergers, licenses or strategic initiatives that change Advance Nanotech's business, structure or projections; the development of competing products; uncertainties related to Advance Nanotech's dependence on third parties and partners; and those risks described Advance Nanotech's filings with the SEC. Advance Nanotech disclaims any obligation to update these forward-looking statements.

Further information about these and other relevant risks and uncertainties may be found in the Advance Nanotech's findings with the Securities and Exchange Commission, all of which are available from the Commission as well as other sources.