PERTH, Australia, Feb. 8 /PRNewswire-FirstCall/ -- Orbital Corporation Limited (ASX: OEC - 'Orbital') and Sygma Motors - Engenharia, Industria E Comercio de Motores Ltda of Brazil ('Sygma') are pleased to announce that agreement has been reached on two significant engineering programs, with Vale Solutions in Energy ('VSE') as the end customer.

Senior representatives of Orbital and Sygma, including Directors of Sygma Group and Sygma Motors, and the Chief Executive Officer of Orbital, have met for discussions regarding joint business initiatives in Brazil. The discussions were supported by the President of VSE, Sygma's exclusive partner for engine development.

Orbital's FlexDI(TM) has been selected as the most promising technology for a new family of high efficiency heavy duty Flex Fuel engines currently being developed by Sygma for VSE. The application will commence with an engine test and development program supported by Orbital with a total value of $A1.6m; also included in the scope is co-development of a spark ignited ethanol combustion system to be used in a demonstration program, and targeted for retrofit of existing diesel engine applications.

Applications include ethanol and CNG flex-fuelled internal combustion engines; initially, but not limited to the 80 to 1500 hp power generation class in Brazil, and subsequently in other markets and sectors. VSE intends to utilize these engines, primarily in the resources sector, in support of a clean energy strategy.

The companies will also cooperate on possible flex-fuel OE and retrofit applications for transportation, either with spark ignition FlexDI(TM) or diesel pilot ignition, for Ethanol and CNG fuelling of heavy duty engines, and for the light duty commercial vehicle sector.

The Companies recognize the primary market drivers for uptake of flex-fuel ethanol-CNG engines will include environmental benefits for local air quality together with greenhouse gas abatement, operational cost savings, and the market appeal of clean energy solutions.

Terry Stinson, Orbital's Chief Executive Officer, commented 'Our new alliance with Sygma Motors is in line with Orbital's strategy to expand into alternative fuels. We are very pleased to continue our initiatives with Sygma Motors in Brazil.