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Phoslock Water Solutions Ltd (ASX:PHK) North American Business Update

North American Business Update

Key Points:

  - Sales pipeline in United States will generate meaningful revenue in the current quarter

  - Four projects scheduled to be completed in Canada over next few months

  - Large project in Mexico to commence in early 2012

United States

The sales momentum is building strongly in the United States. PWS has three licensees covering all of continental United States.

The licensees report good initial sales and have built up an impressive array of pipeline projects, a number of which are scheduled to be applied over the next six months.

Recent sales plus sales schedule to occur solely for the United States will be in the region of $300,000 - $500,000 for the current quarter.

Canada

In Canada, PWS has four projects scheduled to be completed over next few months, ranging from lakes, storm water basins and parts of the Holland River, all in Ontario.

The stormwater application in the metropolitan area north of Toronto is part of a series of applications to stormwater basins to lock up phosphorus in these basins. PWS has undertaken considerable research on stormwater basins showing that the currently used methods do not lock up phosphorus adequately. This applies to hundreds of stormwater basins, some up to 2 hectares in size.

The planned river and lakes projects in Ontario this year will require up to 150 tonnes of Phoslock. In addition, GDG Environnement, PWS’s licensee for Quebec and the Atlantic provinces has identified a number of new projects, some of which could be significant.

Mexico

Over the past 18 months, PWS has been working with authorities responsible for the restoration of a major metropolitan water supply reservoir in Mexico. The reservoir suffers from severe algal blooms which are caused by both high internal and external phosphorus loadings. In-lake trials with Phoslock will be undertaken in the second half of 2011 and, if successful, an application of several thousand tonnes of Phoslock on the whole reservoir can be expected during 2012 and 2013 as a measure to reduce the internal phosphorus load. Additional measures are also being planned to reduce phosphorus inputs from the catchment area.

In summary

The pipeline of Phoslock applications in the Americas has significantly strengthened this year with the appointment of new distribution partners. PWS now has an extensive reach into target markets in North and Central America, and the US in particular. Results are expected to be evident in significantly increased sales in this region within the next twelve months.

For more information please contact:

Mr Robert Schuitema, Managing Director - (02) 9439 7715

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