ENVIRONMENTAL CLEAN TECHNOLOGIES LIMITED. — Capital/Financing Update 2006

Mar 1, 2006

SOLUTIONS ENVIRONMENTAL INTERNATIONAL ITD

ABN 28 009 120 405

2 March 2006

Company Announcements Office Australian Stock Exchange Limited

Dear Sir / Madam.

By e-Lodgement 3 Pages

ESI's TARGET ACQUISITION RECEIVES PURCHASE CONTRACT

The Directors of Environmental Solutions International Limited ("ESI") are pleased to announce that Asia Pacific Coal and Steel Pty Ltd ("APCS"), the company it is currently in the process of acauirina, as mentioned in the announcement dated 10 February 2006, has signed a Deed for a forward order with Green Power Resources PTE LTD, Singapore ("GPR") for the supply of 3 million tonnes per annum (3mtpa) of brown coal pellets formed from the patented APCS Coldry Process®

The first shipment of 50,000 tonnes is scheduled to commence on or before November 2007 from the APCS production centre at JBD Industrial Park, Bacchus Marsh.

The APCS agreement with GPR provides for Coldry® pellets to be supplied at the Newcastle Coal Spot Price as published in the daily newspaper in US Dollars and to be delivered in the 3 calendar months following publication date at the time of confirmation of shipment F.O.B Geelong Port, Victoria, Australia.

The executed Deed shall form the basis of a formal agreement which will be finalised within the coming weeks.

In the event that APCS is able to produce more than 3mtpa of brown coal in any given year, then GPR will have a first right to purchase the extra tonnage from APCS on the same terms as mentioned above.

APCS through its suite of unique technologies (Coldry Process®) is able to convert abundant high moisture lignites, found primarily in Victoria's Gippsland Basin, Latrobe Valley, Anglesea and Bacchus Marsh regions, into stable, high energy, low moisture, transportable pellets that are suitable as a high quality feedstock for use in the conversion of coal to oil, coal to hydrogen and power generation.

The Coldry Process® is a privately developed Victorian technology that successfully dewaters brown coal and is now ready for large scale commercial application.

T: (08) 9486 2333 F: (08) 9355 4580

SOLUTIONS ENVIRONMENTAL INTERNATIONAL $\blacksquare$

ABN 28 009 120 405

The Coldry® pellet product is manufactured at low cost and creates large quantities of saleable pure distilled water as a by-product of the dewatering process. One million tonnes of water is recovered for every one million tonnes of Coldry® pellets produced.

Pellets produced from the Coldry Process® reduces carbon dioxide emissions from brown coal by up to 30%. The Process introduces a new pathway for brown coal dependent countries such as India, Greece and China to achieve major emissions reduction.

The APCS agreement with GPR reinforces the strategic importance of the ESI acquisition of a technology that will enable ESI to investigate substantial commercial opportunities for dewatering brown coal, sludge and other materials, including the production of composite (low grade) iron ore and brown coal pellets for use in an innovative new low cost steel making process.

About Green Power Resources PTE LTD. Singapore (GPR):

Green Power Resources (GPR) is a special purpose Singapore Corporation established to carry out commodity trading specifically focused on green power technologies.

The principals of GPR have extensive experience in the coal, steel, cement and timber industries and have in the past traded significantly higher quantities than currently contracted to purchase from APCS.

About Asia Pacific Coal & Steel Pty Ltd (APCS):

APCS is a privately owned Australian environmental technology company which was formed to commercialise and licence its patented Coldry Process® and Matmor Process®.

The patented Coldry Process® is a unique process that dewaters brown coal and similar materials by as much as 85% in a mechanically simple and economic way. The patented Matmor Process® utilises a modified pellet formed from the Coldry Process® in a low cost, low emission retort to produce high quality steel.

More information is available on the APCS website: www.cleancoal.com.au

SOLUTIONS INTERNATIONAL LTD ENVIRONMENTAL

ABN 28 009 120 405

About Environmental Solutions International Ltd:

ESI is a publicly listed Australian waste management solutions company which specialises in the design, construction and operation of plants for clients in the water, wastewater and waste disposal businesses.

ESI has embarked on an aggressive and comprehensive global development programme for the ENERSLUDGE™ technology. The key to this patented technology is the molecular rearrangement by a process of slow pyrolysis plus infimate contacting of the product streams in the main conversion reactor to obtain the optimum quality of products. A series of lower cost and more flexible 'second-generation' designs are now ready for market and backed by 'off balance sheet' financing.

The ENERSLUDGE™ fechnology provides enormous environmental and operational flexibility. The variety of potential uses for the ENERSLUDGE™ output products from a particular sludge or waste give the technology considerable market and commercial flexibility.

Ends.

For further information please contact:

MR SACHLAN FRAVAL

Chairman

Contact: 0408 574 252