Vancouver, Canada
September 4, 2008

Dynamotive Reports 2nd Quarter 2008 Results

VANCOUVER, CANADA, September 4, 2008 – Dynamotive Energy Systems Corporation (“Dynamotive”) (OTCBB: DYMTF), a leader in biomass-to-biofuel technology, today reported its second quarter 2008 results.

For the three months ended June 30, 2008, the Company reported a net loss of $2.9 million or $0.01 per share, compared with a net loss of $3.5 million or $0.02 a share for the same period a year earlier. When stock-based compensation is excluded, Dynamotive’s Q2 2008 net loss was $2.3 million, compared with $2.8 million during 2007. (All figures are in US dollars.)

The lower loss for the quarter is due mainly to lower business development, research and development expense and an overall reduction in general and administrative expenses, partially offset by increased activity levels in the Company’s US and Argentine offices.

During the quarter, Dynamotive continued commissioning of a modular 200-tonnes-per-day intermediate grade BioOil® plant in Guelph Ontario and repaired fire damage at the upgraded 130 tpd plant in West Lorne, Ontario.

President and CEO, Andrew Kingston, said: “During the second quarter of 2008 and since quarter end, Dynamotive has completed the repair and start-up of the West Lorne plant and has made related modifications in Guelph.  Although the four month delay due to these events occasioned by the thermal incident, has slowed our project development activity, the Company is receiving renewed expressions of interest from these prospects and has an attractive pipeline of advanced opportunities.  Sales of BioOil and char to existing customers and prospects for additional product contracts in the next few months are promising.  We look forward to increased sales activity through the remainder of this year and to making advances in the US, South American and other project developments.”

Quarter  highlights

• Completed repair work and re-commissioning at West Lorne along with implementation of preventative measures at Guelph.
• Initial post-repair production from the upgraded West Lorne plant in July 2008, with $100,000 of invoiced sales of product and services since re-start-up.
• Completed additional contracts in US and Argentina to advance project developments.
• Completed additional third party tests on BioOil, BioOil Plus and BioChar.
• Advanced research and development work on a two stage process for the upgrading of BioOil, which the Company believes can be a cost effective path to using BioOil in the production of mobile fuels in conventional refineries.
• The Company is currently working with its investment bankers and has agreed terms in principle for convertible debt financing.  Subject to final agreements and market conditions, funding is targeted for September.

Summary Financial results are presented as follows:

Unaudited Consolidated Statements of Loss
(Expressed in U.S. Dollars)
	Three Months Ended June 30,		Six Months Ended June 30,
	2008	2007	2008	2007
	$	$	$	$
Revenue
License Revenue	-	-	500,000	-
Expenses
Marketing and business development	190,543	348,524	509,795	694,752
Research and development	317,223	616,446	548,145	1,510,167
General and administrative expenses	2,209,795	2,576,956	4,662,442	4,670,695
Depreciation and amortization	38,256	34,374	75,421	64,580
Interest expense	48,502	2,606	66,241	2,659
Exchange (gain) loss	98,783	54,322	113,218	37,679
Total expenses	2,903,102	3,633,228	5,975,262	6,980,532
Loss from operations	(2,903,102)	(3,633,228)	(5,475,262)	(6,980,532)
Other income and expense	(5,661)	36,116	(4,304)	115,350
Gain on reduction of bonus and vacation accruals	-	-	1,137,983	-
Loss before non-controlling interest	(2,908,763)	(3,597,112)	(4,341,583)	(6,865,182)
Non-controlling interest	-	94,876	-	123,850
Net Loss for the period	(2,908,763)	(3,502,236)	(4,341,583)	(6,741,332)
Other comprehensive income/(loss)
Foreign currency translation adjustment	476,641	2,875,944	(1,493,255)	3,206,822
Comprehensive loss	(2,432,122)	(626,292)	(5,834,838)	(3,534,510)
Weighted average number of common shares outstanding	209,570,784	185,378,751	208,789,678	181,511,983
Basic and diluted loss per common share
Share for operations for the period	0.01	0.02	0.02	0.04

A full copy of the Company’s Financial Statements and Corporate Update are available at www.dynamotive.com

About Dynamotive

Dynamotive Energy Systems Corporation is an energy solutions provider headquartered in Vancouver, Canada, with offices in the USA and Argentina. Its carbon/greenhouse gas neutral fast pyrolysis technology uses medium temperatures and oxygen-less conditions to turn dry, waste cellulosic biomass into BioOil for power and heat generation. BioOil can be further converted into vehicle fuels and chemicals. Photographs of the Guelph and West Lorne plants may be seen on the company's website. www.dynamotive.com

About BioOil® Biofuel

BioOil® is an industrial fuel produced from cellulose waste material. When combusted it produces substantially less smog-precursor nitrogen oxides (‘NOx’) emissions than conventional oil as well as little or no sulfur oxide gases (‘SOx’), which are a prime cause of acid rain. BioOil® and BioOil Plus™ are price-competitive replacements for heating oils #2 and #6 that are widely used in industrial boilers and furnaces. They have been EcoLogo certified, having met stringent environmental criteria for industrial fuels as measured by Environment Canada’s Environmental Choice Program. BioOil® can be produced from a variety of residue cellulosic biomass resources and is not dependent on food-crop production.

Contact:
Brian Richardson, Chief Financial Officer, 604-267-6004
Switchboard: (604) 267-6000
Toll Free (North America): 1-877-863-2268
Fax : (604) 267-6005

Email: info@dynamotive.com
Website: www.dynamotive.com

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