Peerless Mfg. Co. announces order for retrofit SCR systems for multiple power plant units in California

DALLAS, Jan. 21, 2004 — Peerless Mfg. Co. announced that it has received a multi-million dollar Environmental Systems order from an oil and gas producer in California.

The order consists of Selective Catalytic Reduction systems (SCR) to reduce nitrogen oxides (NOx) from multiple cogen power units that supply steam and electricity to the local oil field.

This project once again shows Peerless’ ability to provide complete solutions to its customers’ environmental issues, and provide solutions that will enable its customers to be in compliance with the more restrictive NOx emission standards recently pronounced in California as Rule 4703 by the San Joaquin Valley Air Pollution Control District as applied to stationary gas turbines. The equipment for this multi-unit order is expected to be shipped in the last quarter of calendar year 2004.

The company also announced today that it has received a multi-million dollar award to supply steam separation equipment for the APS Palo Verde Nuclear Power Plant in Arizona. Peerless’ Steam Separation Systems remove water from a nuclear power plant’s steam generator allowing the plant to run more effectively. The Steam Separation Systems are expected to be shipped in April 2004 and April 2005.

Sherrill Stone, Chairman and Chief Executive Officer of the Company, stated, “The awarding of these contracts to our Environmental and Separation and Filtration business segments affirms our strategy of strength through diversity and our commitment to remain the technological leader in the markets we serve. We believe there are many more opportunities like the project in California for Peerless’ Environmental Systems as State and Federal laws demand greater emission compliance by power producers and industrial manufacturers. Likewise, as a leading supplier of Separation Equipment to the nuclear market, we see increased opportunities as operators seek to enhance the efficiency of their existing facilities. These prestigious awards by repeat customers demonstrate Peerless leadership in service to its clients and I am proud of our reputation in the market place.”

About Peerless Mfg. Co.

Peerless Mfg. Co. is engaged in the business of designing, engineering, manufacturing and selling highly specialized products used for the abatement of air pollution and products for the separation and filtration of contaminants from gases and liquids. The Company, headquartered in Dallas, Texas, markets its products worldwide.

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