GA To Provide Pre-Conceptual Design for High Temperature Teaching and Test Reactor in Texas

GA To Provide Pre-Conceptual Design for High Temperature Teaching and Test Reactor in Texas

FOR IMMEDIATE RELEASE

Feb 23, 2006

General Atomics of San Diego, CA will provide a pre-conceptual design for a next-generation high-temperature test reactor in Andrews County, Texas, under a teaming agreement announced today by GA and The University of Texas System, including The University of Texas - Permian Basin of Odessa, Texas.

Other parties in the teaming agreement for the pre-conceptual design (PCD) phase are The University of Texas at Austin, The University of Texas at Arlington, The University of Texas at Dallas, The University of Texas at El Paso, the City of Andrews, Texas, Midland Development Corporation, Odessa Development Corporation, and Thorium Power, Inc. (McLean, VA), which has recently entered into a merger agreement with Novastar Resources Ltd.

The proposed test reactor, known as the High Temperature Teaching and Test Reactor (HT3R), would be based on the next-generation high temperature helium-cooled reactor developed by General Atomics.

The project proposed in Andrews County, Texas, would include several components: a high temperature helium-cooled teaching and test reactor; a Brayton Cycle laboratory for development of new methods to produce electricity with increased efficiencies; and a high-temperature process and materials laboratory. The reactor would be capable of demonstrating high temperature process heat suitable for use in future applications such as hydrogen production or coal liquefaction.

The pre-conceptual design phase is estimated to cost about $3 million and take about six months to complete. The project participants will then decide whether to move forward with the HT3R by seeking additional funding for engineering, licensing, construction and operation. The PCD phase will include studies on where the reactor would be located, how large it would be, a budget, and operational proposals.

"We want to help lead the country and the world into the hydrogen economy," said Jim Wright, UT-Permian Basin project manager. "Japan and China are the only countries in the world with high temperature helium-cooled test reactors, and each is working to generate hydrogen from such systems as an alternative energy source." He added that the HT3R would also serve as an important cornerstone for helium-cooled reactor technology educational programs at UT-Permian Basin and other colleges and universities.

E. Michael Campbell, Senior Vice President of General Atomics, added that the HT3R would provide complementary support to the proposed Department of Energy Next Generation Nuclear Plant demonstration project (NGNP) at Idaho National Laboratory, which is a prerequisite to commercial deployment of high temperature helium-cooled reactor plants. GA also recently announced a joint research program with the Korea Atomic Energy Research Institute for the production of hydrogen using helium-cooled reactors.

Under the teaming agreement, Thorium Power, Inc. will provide expertise to GA on specific thorium fuel designs to be addressed in the PCD. Thorium Power President Seth Grae said, "Our participation gives us a great opportunity to explore a modified version of our proliferation-resistant thorium-based fuels for use in the next generation of reactors."

For more information contact:

Doug Fouquet

General Atomics

(858) 455-2173

Fouquet@ga.com

Michael Warden

The University of Texas System

(512) 499-4363

Mwarden@utsystem.edu

Myra Salcedo

UT Permian Basin Odessa, TX

(432) 552-2806