Earthworks receives explanation of EPA delays

July 10, 2012

Earthworks Industries Inc. (the "Company") reports that it has received an update on the status of the submission made by its consultants SCS Engineers, to the U.S. Environmental Protection Agency (EPA) in February of this year on the Cortina integrated waste management facility.

In response to a letter to the EPA from the Cortina Band, the Wintun Environmental Protection Agency and Earthworks’ subsidiary Cortina Integrated Waste Management Inc. (CIWM) regarding the delay in processing of CIWM’s application to the EPA, Mr. Jeff Scott, Director of the Waste Division for Region 9 of the EPA, explained the reason for the unexpected delay.

To ensure technical submissions are fully protective of human health and the environment, EPA relies on both internal and external expert review. EPA contracts with external experts to complete these reviews. This year, EPA received its federal funding appropriation very late in the federal Fiscal Year. Many EPA offices, including the Office of Research and Development (ORD), were not able to move forward on pending work until a budget was in place.

Staff of the EPA Region 9 office communicated with the ORD in early February 2012 identifying their need for an external expert review of the February 1, 2012, SCS Engineers submission. In mid-June 2012 the ORD had a budget in place and received bids on their new national technical support contract and is now in the process of selecting contractors.

Mr. Scott has advised that the external expert review should be initiated shortly and that EPA will advise CIWM of a completion date at that time.

CIWM looks forward to finally completing this phase of the permitting which has taken considerably more time than expected. Unfortunately delays by the regulatory agencies are entirely beyond the Company’s control.

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