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Naturally Advanced Technologies and Ashland Inc. Agree to Jointly Develop CRAiLEX High Grade Dissolving Pulp

Posted on June 13, 2011

Vancouver, British Columbia & Portland, Oregon — Naturally Advanced Technologies Inc. and Hercules Incorporated, a subsidiary of Ashland Inc., today announced that they have entered into a joint development agreement for CRAiLEX™ high-grade dissolving pulp. CRAiLEX is the brand name for the purified pulp created from a patented process that is exclusively held by Naturally Advanced Technologies Inc. In recent tests, CRAiLEX has proven to exhibit higher-grade value pulps than any other hard- or soft-wood pulps. The pulps are used by Ashland to create its line of cellulosic products for multiple industries.

“This is the start of our CRAiLEX technology roll out,” said Ken Barker, CEO of NAT. “In the same manner and strategy we employed to bring our CRAiLAR® technology to commercialization, partnering with an industry leader such as Ashland Inc. is a key milestone in the development of CRAiLEX. We are extremely proud of the opportunity and partnership potential in working with Ashland.”

Naturally Advanced Technologies Inc. develops renewable and environmentally sustainable biomass resources from flax, hemp and other bast fibers. The Company, through its wholly owned subsidiary, CRAiLAR® Fiber Technologies Inc., has developed proprietary technologies for production of bast fibers, cellulose pulp, and their resulting by-products in collaboration with Canada’s National Research Council and the Alberta Innovates. CRAiLAR technology offers cost-effective and environmentally sustainable processing and production of natural, bast fibers resulting in increased performance characteristics for use in textile, industrial, energy, medical and composite material applications. The Company was founded in 1998 as a provider of environmentally friendly, socially responsible clothing. For more information, visit www.naturallyadvanced.com.

Neither the TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Statement Disclaimer

This news release includes certain statements that may be deemed “forward-looking statements.” All statements in this news release, other than statements of historical facts, are forward-looking statements. Forward-looking statements or information are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements or information and including, without limitation, risks and uncertainties relating to: any market interruptions that may delay the trading of the Company’s shares, technological and operational challenges, needs for additional capital, changes in consumer preferences, market acceptance and technological changes, dependence on manufacturing and material supplies providers, international operations, competition, regulatory restrictions and the loss of key employees. In addition, the Company’s business and operations are subject to the risks set forth in the Company’s most recent Form 10-K, Form 10-Q and other SEC filings which are available through EDGAR at www.sec.gov. These are among the primary risks we foresee at the present time. The Company assumes no obligation to update the forward-looking statements.