Catalytica Combustion Systems

Dear Sir,

Catalytica Combustion Systems wishes to clarify the information that you published in your March 2000 issue regarding the previously-announced Enron 7FA orders in December 1999. As you indicated, the order specifies Catalytica’s Xonon system for the gas turbines. However, either GE or Enron may substitute alternative emissions controls if the Xonon system cannot be developed or has not been developed in time to support the project schedule. Our collaborative efforts to adapt Xonon to the 7FA are in progress; however, the system has not yet been demonstrated at 7FA gas turbine combustion conditions, and therefore, is not a commercial offering at this point.

Our current areas of emphasis in the adaptation of Xonon to GE gas turbines are the PGT-10B and 7FA models. We do not currently have a collaborative effort underway to adapt Xonon to GE’s H technology gas turbines as this step would require successful prior commercial operation on FA technology combustion conditions. Xonon for the H technology gas turbines will only be considered after successful commercial operation of Xonon on the 7FA gas turbines has been demonstrated.