Compliance Energy options site for coal power plant

Compliance Energy owns a small coal mine near Coalmont in the Tulameen Coalfield, just west of Princeton. They are also the 75% owner of coalbed methane rights in the coalfield, with the Upper Similkameen Band owning the remaining 25%.

Compliance Energy have made much of their intention to build a coal fired power plant at or near the mine site. Their recent news announcement concerns an option to acquire a site for the power plant. It’s just an option, at this point.

The power plant would have to undergo an environmental assessment, whatever value that has in British Columbia these days. It would also need a customer. The likeliest customer is an industrial user, such as the Weyerhaeuser mill in Princeton, or the Princeton Light & Power Company (PLP).

PLP is a privately owned company which supplies the Princeton area with electricity. PLP currently obtains all their power from the Fortis system (formerly Aquila Networks, Utilicorp, and before that, West Kootenay Power)

Other activities that Compliance are engaged in:

– an agreement to provide fuel (coal, probably) to a coal/biomass generation project that Northland Power was proposing on northern Vancouver Island. This project was orginally proposed in BC Hydro’s Call for Tenders for power on Vancouver Island, but was not included in the shortlist published at the end of April. The project is likely dead, unless an industrial customer emerges.

– Compliance acquired the Wolf Mountain coal property near Nanaimo in 2004. We have yet to understand why. Possible reasons may have been to provide coal to the Northland project, or mining it for other coal sales, or even a coal-fired generation project.

COMPLIANCE ANNOUNCES POWER PLANT SITE AGREEMENT
16:06 EDT Monday, July 05, 2004

FSC / Press Release

Vancouver, British Columbia CANADA, July 05, 2004 /FSC/ – Compliance Energy Corporation (CEC – TSX Venture), (the “Company”) is pleased to announce that it has entered into an agreement to acquire land near Princeton, BC sufficient in size to develop a plus 50 MW wood waste /coal power plant. The selected site has extensive existing infrastructure including; one large building that could be modified into a boiler house to house the boilers and turbines for the development, a 38 KV power line that extends onto the site that will help reduce interconnection development costs and necessary water supply facilities. The agreement provides for a 12 month due diligence period which has been secured with a $20,000 deposit. The total purchase price of $1.25 million is due upon exercise of the option to acquire the property.

Compliance recently developed and operates the Basin Coal Project located near Princeton, British Columbia as a joint venture with Nissho Iwai Coal Development Ltd. The Company is on target in developing markets to match its production capacity. Compliance is now moving forward with the next stage of development based on a positive engineering report for its proposed plus $100 million wood waste / coal power plant project to be located near its new coal mine. The Company also announced a strategic alliance with Northland Power Inc whereby Compliance will assist in securing the fuel supply for the development of a 49 MW biomass/coal fuelled power generation project (“Power Project”) to be located on Vancouver Island and may earn a 15 percent equity interest in the Power Project. In addition, the Company just recently was awarded the Coal-bed methane gas rights to the Tulameen basin.

Compliance Energy Corporation’s shares trade on the TSX Venture Exchange under the symbol CEC and investor information is available on the Company’s web page at www.complianceenergy.com.

Contact Rod Shier at 604-689-0489 for further information.

On behalf of the Board of
COMPLIANCE ENERGY CORPORATION

Per:

“Jim O’Rourke”
Jim O’Rourke
Director
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Compliance Energy Corporation
Suite 584, 885 Dunsmuir Street
Vancouver, BC V6C 1N5
Telephone: (604) 689-0489
Facsimile: (604) 681-5910
Web Page: www.complianceenergy.com

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