---

MAN Diesel, a leading provider of diesel engines for marine and power plant applications, has signed an agreement with Daewoo Shipbuilding & Marine Engineering Co. Ltd (DSME) to develop high pressure gas ship propulsion systems that if applied to container ship, are said to be able to reduce annual operation costs by more than $12 million, based on current gas and oil prices.

The two companies will develop an environmentally friendly system to supply high pressure gas for MAN Diesel's ME-GI engine. Both companies plan to operate a prototype by the end of this year.

Mr. YoungMan Lee, Senior Executive Vice President & CTO of DSME said, 'The ME-GI engine can be adopted for other kinds of vessels such as container ships and oil tankers as well as LNG carriers'.

He added, 'it is also noteworthy that this system will not only provide economic value, but also address important environmental issues at the same time'.

DSME already holds over 10 patents related to the high pressure gas supply system and they plan to ready for the market by applying to various types of ships. This gas supply system will subsequently be not only used for MAN B&W engine, but also for other type of gas engines.

In addition, DSME says it is actively working on many R&D projects focusing on environmentally friendly ship design including energy saving devices for main propulsion, clean fuel utilization (LNG, low sulphur oil), VOC (Volatile Organic Compounds) reduction systems, emission reduction systems (NOx, SOx, CO2), and fuel cell technology applications for electric power generation.