Coates International, Ltd. Announces Second Quarter General Update

WALL TOWNSHIP, NJ–(EMWNews – August 21, 2008) – Coates International, Ltd. (the “Company”

or “Coates”) (OTCBB: COTE) — is pleased to announce that for the first

time in more than 18 years of research and development, and since the

research was completed in November 2007, the Company is reporting a modest

profit in this second quarter. For more information, refer to our

quarterly report on Form 10-Q which can be found at www.sec.gov by

searching under our ticker symbol COTE.

Update on Retrofitting of Heavy Truck Project

The retrofitting of the CSRV System and Heads have successfully been

retrofitted to the 18 Wheeler Tractor Trailer N14 Engine. The engine is

now complete. We are now developing a high pressure sequential diesel fuel

injection system.

Upon completion of the fuel injection system, the engine will be mounted

into the truck and fired up for the final testing of fuel consumption,

emissions, etc. We have been informed by sources in the industry that many

heavy trucks powered by diesel engines are experiencing fuel consumption

averaging in the 2.5 to 5 miles per gallon range on diesel fuel. A number

of companies have contacted us regarding retrofitting their trucks with our

patented CSRV System.

Management is extremely pleased with this project’s progress and urging

staff to press on with this project to completion. Anticipation of the

continuing increase in the demand for the retrofitting of heavy trucks

leads management to believe this to be one of the most promising markets

for our technology. We have strategically focused our resources towards

penetrating that market segment.

Update on Well to Wire Energy, Inc. Project

According to our Escrow License Agreement with Well to Wire Energy, Inc. of

Canada, the balance of the Canadian exclusive license and development costs

were to be paid in full, on or before the 30th of June, 2008. The total

amount due, including the deposit on the USA exclusive license, was

$11,000,000. Well to Wire has paid our company non-refundable payments to

date, totaling $2,400,000, leaving a balance of $8,600,000 to be paid to

Coates. No extension has been granted by Coates to date and the final

deadline is the 30th of September, 2008.

Management has stated that for Well to Wire Energy to be granted an

extension, it must pay the Company deposits totaling at least $3,000,000

and make interest payments at the rate of 5% per annum on the $8,000,000

balance. Well to Wire has confirmed that it is continuing its efforts to

raise the funds to satisfy the remaining balance, through equity financing.

Our Company has verified that Well to Wire has executed an agreement with

Canada West Corp. Financing, Inc. in the amount of almost $1.2 billion

dollars for equipment acquisitions from Coates International, Ltd. This

would include, but is not limited to, 7,404 Electric CSRV Generating

Systems over the next five years. There also remains a balance of

$49,000,000 for the US License due to the Company in installments after the

original $11,000,000 has been paid in full.

Update on Production

The planning for production of our CSRV Industrial Engines for Electric

Power Generators, and the retrofitting of heavy trucking is an immense

project.

Important considerations are:

--  The location of the production plant

    

--  Management and skilled staff availability

    

--  Material supply

    

--  Casting foundries

    

--  Constant supply of parts and components

    

--  Access to critical roadway, rail, air and sea routes for shipping

    worldwide

    

Management is in discussion with third parties regarding all of the above.

Additional information will be disclosed as detailed arrangements are

firmed up.

Prospective investors having interest in acquiring shares of our capital

stock should not contact the Company and should only consult with their

investment adviser. The Company does not sell shares to the general

public.

About Coates International, Ltd.: Coates has completed development of its

patented spherical rotary valve CSRV Industrial Internal Combustion Engine

developed over a period of more than 6 years and other CSRV applications

over 10 years. The underlying CSRV technology was invented by George J.

Coates and his son Gregory. The CSRV system is adaptable to combustion

engines of many types. This technology is currently adapted to a number of

practical applications including industrial generators powered by engines

incorporating the CSRV technology and designed to run on flare-off gas from

oil wells, landfill gas and raw natural gas. The Company is actively

engaged in planning for production and rollout of these engines. The

Company is also focusing its efforts on developing the technology for

retrofitting diesel truck engines with its CSRV system with the objective

of improving fuel efficiency and reducing harmful emissions.

This press release contains forward-looking statements that are made

pursuant to the safe harbor provisions of the Private Securities Litigation

Reform Act of 1995. By their nature, forward-looking statements and

forecasts involve risks and uncertainties because they relate to events and

depend on circumstances that will occur in the near future. There are a

number of factors that could cause actual results and developments to

differ materially from forecasted results. These risks and uncertainties

include market conditions, regulatory approvals, and other risks inherent

in our operations. For a discussion of these risks and uncertainties,

please see our filings with the Securities and Exchange Commission. Our

public filings with the SEC may be viewed and printed on the website

maintained by the SEC at http://www.sec.gov.