DIL Dyadic International

Dyadic International, Inc. (AMEX:DIL), a biotechnology company, announced today that it has joined one of Europe's leading producers of bioethanol, Royal Nedalco, and other partners in R&D projects funded by the Netherlands government to develop technologies to produce ethanol from sugar beet pulp and wheat bran. Dyadic Nederland BV, Dyadic's subsidiary in Zeist, the Netherlands, will focus on the development of optimal enzyme preparations for the extraction of sugars from these feedstocks. Jan Verdoes, Ph.D., Research Director, Dyadic Nederland BV, said, "Sugar beet pulp, with its currently low value, high volume at centralized locations and abundant carbohydrate content, is an attractive feedstock for the production of bioethanol. Wheat bran, a byproduct of wheat processing, is another attractive bioethanol feedstock. However, the enzyme preparations to economically extract sugars from these materials and the yeasts required to ferment these unusual sugars for large-scale ethanol production need to be further developed. Our research projects are designed to overcome these technical problems and contribute to the development of economically viable renewable fuels for the future." Funding for the projects will be provided by grants from the Ministry of Economic Affairs in the Netherlands, in the Energy Research Program EOS, managed by SenterNovem (see Ref). In addition to Dyadic Nederland BV, the four-year sugar beet pulp collaboration will include Wageningen University for characterization of enzyme-treated substrates, Delft University for yeast fermentation engineering, the Energy Research Center of the Netherlands for process modeling and economics, and Royal Nedalco for commercial testing of the process. For the two-year wheat bran collaboration, Dyadic joins Wageningen University for characterization of plant cell wall polysaccharides, BIRD Engineering for fermentation technology, and Royal Nedalco for commercial process testing. Royal Nedalco, headquartered in Bergen op Zoom, the Netherlands, is a subsidiary of Cosun, a producer of natural ingredients and foodstuffs for the international food industry with annual revenue of approximately �1.3 billion. Jan de Bont, Director of R&D at Nedalco and Project Manager for both projects, added, "We have assembled outstanding teams for these projects, featuring world-class technology, scientific expertise, and commercial know-how. We look forward to working together to address the significant market opportunities we all see in the emerging biofuels industry." "While we expect our share of funding for these collaborative research projects to contribute only modestly to Dyadic's overall R&D budget, the real impact is potentially far greater. Not only will our work on the projects advance Dyadic's proprietary enzyme technologies, we also are pleased to be involved in efforts that have the potential to deliver significant progress toward the goal of reducing the world's dependence on petroleum in favor of renewable, environmentally friendly biofuels," said Glenn E. Nedwin, Ph.D., Chief Science Officer of Dyadic. "Our R&D subsidiary in the Netherlands enables us to take advantage of opportunities to participate in such government-funded research projects with leading companies and academic research groups in Europe, and we look forward to participating in additional collaborations." About Dyadic Dyadic International, Inc. is engaged in the development, manufacture and sale of biological products using a number of proprietary fungal strains to produce enzymes and other biomaterials, principally focused on a system for protein production based on the patented Chrysosporium lucknowense fungus, known as C1. Dyadic is applying its technologies to produce enzymes for use in converting various agricultural products (e.g. corn) and waste products (e.g. switch grass, wheat straw, sugar cane bagasse, etc.) into fermentable sugars, which can then be used in the production of traditional and cellulosic ethanol as well as other products currently derived from petroleum. Dyadic's C1 technology also is being developed to facilitate the discovery, development and large-scale production of human antibodies and other high-value therapeutic proteins. Dyadic currently sells more than 45 liquid and dry enzyme products to more than 200 industrial customers in approximately 50 countries for the textile, pulp & paper and animal feed industries. Cautionary Statement for Forward-Looking Statements Certain statements contained in this press release are "forward-looking statements." These forward-looking statements involve risks and uncertainties that could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. For a discussion of these risks and uncertainties, please see our filings from time to time with the Securities and Exchange Commission, which are available free of charge on the SEC's web site at http://www.sec.gov, including our Annual Report on Form 10-KSB for the year ended December 31, 2005, and our subsequent filings with the SEC. Except as required by law, we expressly disclaim any intent or obligation to update any forward-looking statements. Reference EOS: http://www.senternovem.nl/English/Products_Services/Towards_ Sustainable_Energy/Energy_Research_Subsidy.asp. (Due to its length, this URL may need to be copied/pasted into your Internet browser's address field. Remove the extra space if one exists.)