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FOR IMMEDIATE RELEASE

O2DIESEL LAUNCHES 1st CALIFORNIA REFUSE TRUCK FLEET OPERATION

NEWARK, DE, November 17, 2004 --/WORLD-WIRE/--
O2Diesel Corporation (AMEX: OTD) announced today that is has begun delivering its proprietary fuel, O2Diesel(TM), to California-based E.J. Harrison & Sons, Inc. E.J. Harrison & Sons is the first major refuse truck fleet operation to begin the conversion to O2Diesel(TM). The refuse fleet market segment is under pressure from the California Air Resources Board (CARB) regulations to reduce emissions. The yearlong two-phased program, which is funded under the terms of O2Diesel's subcontract with the National Renewable Energy Laboratory (NREL), commenced with 14 trucks running on O2Diesel(TM), with the bulk of the 120 vehicles being brought on in a few weeks.

"The O2 Diesel team has been very meticulous in covering all the bases to make sure that our transition to the product is as seamless as possible for our operation," says Ed Lopez, Fleet Manager for E.J. Harrison & Sons, Inc.

Harrison is pioneering the use of this fuel technology as part of O2Diesel's Diesel Emissions Control Strategy (DECS). This verification process will demonstrate the emissions benefits of its proprietary fuel combined with exhaust retrofit technologies, which achieves over 85% reductions in toxic Particulate Matter (PM) emissions. The DECS verification process is being negotiated with CARB officials, and will be completed early next year. Once obtained, regulated fleets like the refuse industry, urban buses, and government vehicles will have a lower-cost technology that provides emission reductions versus existing far more costly alternatives.

"We are very pleased that one of our most valued members has decided to undertake this important fleet fuel demonstration," said Sean Edgar, Executive Officer of the Clean Fleets Coalition. "Our refuse handling and recycling partners are on the forefront of protecting the environment and human health, and they see technologies like O2Diesel(TM) as a way forward to improve air quality and keeping their fleet operating costs as low as possible."

In September 2003, O2Diesel(TM) was verified by CARB as an "alternative diesel fuel," setting the stage for widespread adoption of the fuel for its emissions benefits.

Working with its fuel supply partners, O2Diesel(TM) is terminal-blending the fuel to specification using the latest technology and delivering it to Harrison's fleet refueling location. O2Diesel(TM) is available not only in California but also in any fuel market utilizing the existing diesel fuel storage, supply, and distribution network. The Company's patented additive technology produces a stable ethanol-diesel blended fuel which when used in standard diesel engines results in a more complete combustion and emissions of fewer toxic and ozone-forming pollutants.

More About O2Diesel: The Company and Its Fuel Technology

O2Diesel Corporation (AMEX: OTD) and its U.S. subsidiary O2Diesel, Inc., is a pioneer in the commercial development of a cleaner-burning diesel fuel alternative that provides exceptional performance and environmental qualities for centrally fueled fleets and off-road equipment of all kinds. Engineered and designed for universal application, O2Diesel(TM) is an ethanol-diesel blend that substantially reduces harmful emissions without sacrificing power and performance. Extensive independent and government-recognized laboratory and in-use field tests have demonstrated the effectiveness of O2Diesel(TM) -- the introduction of this cost-effective, cleaner-burning diesel fuel is now underway in the United States and other global markets. For more information please refer to www.o2diesel.com.

Forward Looking Statements

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding O2Diesel Corp's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year. "O2Diesel" is a trademark of O2Diesel Corp.

CONTACT:
Brooks Haden
Vice President
O2Diesel Corporation
302-266-6000
ir@o2diesel.com

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