China's National Electric and Water Company Becomes Exclusive Marketing Distributor for ATG's Catalyst to Power Plants Throughout China.

Business Editors

BEIJING and MONROVIA, Calif.--(BUSINESS WIRE)--Sept. 25, 2000

Agreement Confirms Commercialization of ATG's Product for the Industrial Marketplace; This Announcement is Being Made by ATG in the

U.S. and CWEMEC in China

American Technologies Group Inc. (ATG) (OTCBB:ATEG) Monday announced that, following a year-long test of its proprietary catalyst in two power generators in China, the China National Water Resources and Electric Power Materials and Equipment Company, Ltd. (CWEMEC), a government owned company and the second largest company in China, has endorsed the catalyst for use in power generation facilities throughout China.

ATG also announced the appointment of CWEMEC as its exclusive distributor for the Chinese market.

ATG agreed almost two years ago to have CWEMEC supervise the test of the catalyst in two power generators. The tests, which have been ongoing for more than 11 months, have not only confirmed the effectiveness of the ATG catalyst, but led CWEMEC to become ATG's distributor. In the agreement signed by ATG's Chairman and CEO, Lawrence J. Brady, in Shanghai on Friday, Sept. 22, 2000, CWEMEC confirms the catalyst's effectiveness in increasing fuel economy, reducing emissions and carbon deposits, extending the run time of diesel generators, and the consequent reduction of expensive maintenance and shut-down time.

According to operators at the power plant, reduction of downtime and maintenance requirements are equally as significant as fuel savings and emission reductions.

The success of ATG's catalyst was so significant that, in late 1999, after only a few months of testing, CWEMEC convened a meeting of all its eight District Directors from around China to discuss the performance of the catalyst and its significance to the overall power needs of the country. In China alone, there are more than 1,000 generators in use similar to those on which the test has been conducted. Half of them are in the same geographic region as the testing plant.

This is where the initial marketing effort will be focused. This application alone represents more than $5 million a year in potential sales for ATG. It is hoped to get half of the generators using the ATG product within 12-18 months.

Brady, in announcing the agreement in Shanghai, said: "For a number of reasons, this is one of the most significant developments in ATG's history. It is the first time that one of the company's products, after nearly a year of field testing, is confirmed as an inexpensive, viable, effective solution for a world-wide industry. It confirms the success of ATG's commercialization of this catalyst for the industrial market.

"Second, CWEMEC, a $36 billion (USD) company and the second largest company in China, is responsible for nearly all of the power needs of a country with a population of more than 1.2 billion. This endorsement of ATG's product should get the attention of power generating entities around the world, and will greatly facilitate the company's strategy and ongoing marketing efforts in other areas.

"Third, the market for the catalyst in applications similar to power plants is enormous. Thousands of ships and locomotives use similar equipment, and ATG is already aggressively marketing those applications. The endorsement by CWEMEC is a powerful incentive for prospective customers to use this product.

"Finally, for me personally, this agreement has special significance. The series of meetings held here in Shanghai this week which were attended by me and by ATG Vice President Dr. Chunsing Wang, are some of the most important ever held by ATG, and are a logical and satisfying conclusion to an interest on which I embarked many years ago.

"As Assistant Secretary of Commerce in the Reagan administration, I was the first Reagan administration official to visit China after the President's inauguration. Later, I led a U.S government delegation to China. In fact, my interest in China extends as far back as the days of the Nixon administration, when I was a White House staffer at the time the president traveled to China in 1972.

"I have an intimate understanding of the enormity of the Chinese market and its importance to U.S. companies, as China continues its industrial and economic modernization. One need only compare Shanghai today to Shanghai 15 years ago for evidence of the success of that modernization effort. For a small company like ATG to have its technology endorsed for acceptance in that modernization effort, and to be given the opportunity to join with the second largest company in the most populated country in the world speaks to the potential and future for ATG and its shareholders, and validates the direction on which this company embarked several years ago."

Included in this release are forward-looking statements which the company believes are within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Although the company believes the expectations reflected in such forward-looking statements are reasonable; it can give no assurance that such expectations reflected in such forward-looking statements will prove to be correct. The company's actual results could differ materially from those anticipated in the forward-looking statements as a result of certain factors including sales levels, distribution and competition trends and other market factors.