WALL TOWNSHIP, N.J., March 7, 2012 /PRNewswire/ -- Coates International, Ltd. (NASDAQ OTCBB: COTE) – Coates International Ltd. (the "Company") is pleased to announce that it has completed certain modifications to the lower head castings of the Industrial Natural Gas CSRV Engine Generators, after which the engine was started up and cooled down numerous times. The engine heads were subsequently dismantled and a projector video borescope was employed to inspect the head castings. No cracks were detected by the borescope in the lower heads. Management is satisfied that the problem of the cracked lower head casting has been addressed. The engine will continue to be tested for several additional weeks.
The Company has entered into a confidentiality agreement with U.S.-based third party which manufactures electric power generators. This company has expressed an initial interest in sourcing and/or licensing the following from Coates:
- Coates CSRV Natural Gas Engines pursuant to an OEM manufacturing, use and sale license for the Coates CSRV technology.
- Sourcing heavy-duty diesel engines for highway use from Coates
- Sourcing fire pump engines
- Sourcing gasoline automotive engines.
A key objective for the Company is to distribute its products in the U.S. where the technology was developed. The Company believes its CSRV engine products provide a number of benefits to be realized in the U.S., including reduction of the consumption of fossil fuels and a reduction of the production of harmful emissions. At this time no definitive agreement has been entered into with this company and it is possible that we will not enter into a definitive agreement with this company.
Management believes that entering into definitive supply contracts or licenses with third parties such as these will improve the likelihood that we can raise sufficient working capital to enter into large scale production, the next phase of the Company's business plan.