Clean Diesel Technologies Receives EPA Verification for Second Diesel Retrofit System; System Developed with Mitsui/PUREarth Reduces Soot by Up To 75 Percent.

Energy Editors/Business Editors

STAMFORD, Conn.--(BUSINESS WIRE)--June 7, 2004

Clean Diesel Technologies Inc. (CDT) (EBB:CDTI) (AIM:CDT) (AIM:CDTS) announced today that it has received verification from the U.S. Environmental Protection Agency (EPA) of the performance of its new diesel retrofit emission control system. The system, developed in conjunction with PUREarth Inc. a wholly owned subsidiary of Mitsui & Co. Ltd., has demonstrated up to 75 percent reduction in toxic diesel particulate matter (PM) emissions under the rigorous Environmental Technology Verification (ETV) test protocol. The ETV program provides for independent testing, peer review, independent reporting and public disclosure of test results allowing end-users and regulators to compare the performance claims of vendors against a known protocol. Verified technologies are posted by the EPA on its Web site at www.epa.gov/otaq/retrofit/retroverifiedlist.htm.

The new system incorporates the use of CDT's EPA-registered Platinum Plus(R) fuel-borne catalyst (FBC) and a proprietary filter (CWMF) designed, manufactured and marketed by PUREarth under the PUREcat(TM) tradename. The FBC catalytically promotes more complete in-cylinder combustion and reduces engine-out emissions while improving fuel economy. Soot particles leaving the engine contain active catalyst and are trapped on the catalyzed surface of the filter. There the double action of the FBC and catalyzed surface reduces emissions and effectively oxidizes soot particles to keep the filter from plugging.

According to CDT, this patented approach to soot reduction is capable of performing even under the low exhaust temperatures found in refuse trucks, local delivery and school bus applications. Systems have been operating on beverage delivery and refuse trucks for over 2,000 hours with no maintenance or cleaning. State and federal programs are providing funding and incentives for retrofits of verified technologies. This new FBC/CWMF system allows for high reductions at lower cost and with broader applicability than traditional filters.

CDT also announced that it has submitted a formal application for verification of the FBC/CWMF as a Level 2 control to the California Air Resources Board (CARB). Under its Diesel Risk Reduction Program, CARB requires the retrofitting of the highest applicable verified technology to over one million diesel engines in the state. While performance of the FBC/CWMF is best on ultra-low sulfur fuel, the system is capable of up to 60 percent PM reduction on FBC-treated No. 2D diesel fuel. This makes it the only verified filter system capable of operation on No. 2D, added CDT.

Retrofit verification of the FBC/CWMF applies to all medium-heavy duty on-road engines manufactured between 1991-2003.

CDT/PUREarth expect to market the system directly to fleets in North America while exploring distribution agreements with qualified third parties. PUREarth is also exploring application of the system throughout Asia. Programs are also underway by CDT/PUREarth to confirm performance of the FBC/CWMF system on new engines to target the more stringent 2007 federal emission regulations.

Separately, CDT announced that its previously verified Platinum Plus Purifier System has received extension of its verification by the EPA to cover on-road engines manufactured between 1994-2003 in addition to 1988-1993 engines.

About Mitsui & Co. Ltd.

Based in Japan, Mitsui & Co. Ltd. is one of the world's largest and most diversified international trading companies, with businesses extending from chemicals to steel and metals to transportation machinery. Its Inorganic Chemical Group, together with a unit of Mitsui & Co. (USA) Inc., Mitsui's wholly owned U.S. subsidiary with headquarters in New York City, is working with several industrial partners active in engineering, fuels and heavy-duty vehicles to address diesel engine emissions in Japan. Mitsui has formed a wholly owned subsidiary, PUREarth Inc., to address diesel particulate emissions, and it also has a 50 percent ownership in Denox Inc., a company focused on diesel NOx control. Mitsui holds the exclusive license on CDT's ARIS(R) NOx control technology for Japan.

About Clean Diesel Technologies Inc.

Clean Diesel Technologies Inc. is a specialty chemical company with patented products that reduce emissions from diesel engines while simultaneously improving fuel economy and power. Products include Platinum Plus(R) fuel catalysts, the Platinum Plus Purifier System, and the ARIS(R) 2000 urea injection systems for selective catalytic reduction of NOx. Platinum Plus and ARIS are registered trademarks of Clean Diesel Technologies Inc. For more information, visit CDT at www.cdti.com or contact the company directly.

Certain statements in this news release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known or unknown risks, including those detailed in the company's filings with the Securities and Exchange Commission, uncertainties and other factors which may cause the actual results, performance or achievements of the company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.