BlueFire Ethanol Fuels, Inc. (OTC: BFRE.OB), a leader in cellulosic ethanol production technology, has received the first installment of funding from the U.S. Department of Energy (DOE) for the development of the BlueFire Mecca, LLC plant in Southern California.

Upon completion, the plant will produce approximately 17 million gallons of cellulosic ethanol per year from green waste, wood waste, and other cellulosic urban wastes. Receipt of this funding brings to fruition BlueFire's selection last year, along with five other U.S. Companies, as a recipient of a total of $40 million in DOE funding aimed at increasing the use of renewable and alternative fuels.

A pioneer in cellulosic ethanol production, BlueFire holds the sole North American rights to the Arkenol Process Technology, a patented process for transforming cellulosic waste from landfills into ethanol. By locating its plant in Southern California, the company will utilize this process to meet the needs of a regional market with high ethanol demands while alleviating the onus on cities and municipalities to handle increasing amounts of landfill waste.

"This facility represents the future of alternative fuel production," said Arnold Klann, CEO of BlueFire Ethanol. "It will serve as the effective meeting place of demand and supply, bringing cellulosic ethanol to market while simultaneously helping break dependence on foreign oil and reducing the waste management load on cities."

The Southern California-based facility is a replicable model of a process that can be implemented at several sites across the country, serving the dual purposes of waste management and biofuel production. To this end, BlueFire Ethanol also recently announced it was granted a conditional-use permit ("CUP") from the County of Los Angeles, Department of Regional Planning, to construct the country's first commercial facility to convert biowaste into ethanol. This smaller plant, which will be located in Antelope Valley near Lancaster, California, will produce up to 3.2 million gallons of cellulosic ethanol annually from biowaste materials such as woodchips, grass cuttings, and other organic waste. Scheduled to commence operations in late 2009, the Lancaster plant will also utilize reclaimed water and generate its own electricity and steam from lignin produced as a by-product of the process.

"We are thrilled by the progress on these two plants," said Klann. "Yet, at the same time, they are a glimpse of what can be, and we look forward to continuing to utilize the latest in innovative and eco-friendly technology to increase significantly the production of renewable fuels."