EXHIBIT 10.4

                                                           Project # 25-7004020

                           WESTERN MICHIGAN UNIVERSITY

                                PROJECT AGREEMENT

         This agreement,  effective  August 15, 2003 by and between The Board of
Trustees of Western Michigan University  (hereinafter known as "WMU") and Altair
Nanomaterials,  Inc.  (hereinafter  known as "Altair").  WMU is a constitutional
body  corporate  organized and existing under the  constitution  of the State of
Michigan, with offices in the city of Kalamazoo,  Michigan.  Altair is organized
and existing  under the laws of the State of Nevada,  with offices at 204 Edison
Way, Reno, NV 89502.

Section 1.         EMPLOYMENT OF ALTAIR AND RELATIONSHIP OF PARTIES.  WMU hereby
agrees to engage  Altair to perform the services  herein set forth.  The parties
are  independent  organizations  with  respect  to the  subject  matter  of this
agreement.  The employees of one party will not be deemed to be employees of the
other  party.  Neither  party  will be,  nor will be  deemed  to be, an agent or
partner of the other party for any purpose whatsoever.

Section 2.         SCOPE  OF  SERVICES.   Altair  shall  provide  the  necessary
facilities,  services and  personnel to carry out the  "Design,  Synthesis,  and
Characterization  of  Nanosensors  for Chemical,  Biological,  and  Radiological
Agents" which is attached  hereto and made part of this agreement as Appendix A.
All work shall be performed in a  professional  fashion to the highest  academic
and professional  standards.  Altair's duties and obligations shall also include
complying with all provisions, regulations, and requirements as set forth in the
signed copy of the new Grant No. DE-FG02-03ER63578, Amendment No. A000, together
with the August 14, 2003 cover letter to Jack Luderer  from  Earlette  Robinson,
DOE  Contract  Specialist   (collectively  "DOE  Grant"),  which  documents  are
incorporated  into this agreement by reference,  and also providing all reports,
information,  and  materials  necessary  to WMU in a timely  fashion in order to
assure that WMU is able to perform its duties  under this DOE Grant in a timely,
comprehensive,  and satisfactory  manner. It is also specifically noted that the
DOE Grant includes standard DOE Financial  Assistance Rules (10 CFR Part 600), a
special  provision for penalty if reporting is late, and  Intellectual  Property
Provisions  (FAR  52.227-1,  52.227-2,  52.227-14,  52.227-16,  52.227-23,  DEAR
952.227-9 and  952.227-11),  all of which are included as duties of Altair under
this subcontract and are incorporated herein by reference.  The above referenced
requirements   are   collectively   referred   to   hereafter   as   "compliance
requirements."

Altair  shall also  coordinate  with and  perform  necessary  services  with the
University  of Nevada,  Reno  ("UNR") to ensure that all of  Altair's  and UNR's
duties under both of their  subcontracts  with WMU are performed timely pursuant
to this DOE Grant. The subcontract  between WMU and UNR is also  incorporated by
reference into this agreement.

Section 3.         PERSONNEL.  Altair  represents  that it has or will secure at
its own expense all personnel required to perform the services, obligations, and
duties set forth in this agreement.

Section 4.         TIME OF PERFORMANCE. This agreement shall be effective August
15, 2003 and shall continue 24 months through August 14, 2005 unless  terminated
earlier  pursuant to the provisions of this agreement.  Compliance  requirements
and record requirements shall survive termination of this agreement.

Section 5.         SCHEDULE  OF CHARGES.  WMU agrees to pay Altair for  services
performed  in  accordance  with the budget in  Appendix  B. Within ten (10) days
after the end of each month,  Altair will bill WMU for actual expenses  incurred
during that month. Request for reimbursement will be done via "WMU Subcontractor

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Expense  Report" form (Appendix C). Approval by Dr. Subra  Muralidharan  will be
required prior to payment.  WMU will make reasonable  effort to reimburse Altair
within 15 days of receipt of billing.  Deviations in excess of ten percent (10%)
on any line item category will require prior approval of WMU.

Section 6.         BUDGET LIMITATIONS.  It is expressly agreed to and understood
that in no event will total compensation and  reimbursement,  if any, to be paid
to  Altair  exceed  Three  Hundred  Thousand   Fifty-Six  Five  Hundred  Dollars
($356,500).

Section 7.         FEDERAL  FUNDS.  This  project is being  supported  100% with
federal funds, from the U. S. Department of Energy,  CFDA #81.049 entitled Basic
Energy Science.

Section 8.         LIABILITY.  To the extent permitted by law and the DOE Grant,
each party to this agreement  will be  responsible  for its own actions and must
seek its own legal  representation and bear its own costs,  including judgments,
in any litigation which may arise from its action during the performance of this
agreement.  It is  specifically  understood  and agreed that neither  party will
indemnify the other party in such litigation.  WMU expressly reserves all of its
rights and immunities as provided by law and contract.

Section 9.         TERMINATION  OF  AGREEMENT  FOR CAUSE.  If through  any cause
Altair  shall  fail to  fulfill  in proper  manner  its  obligations  under this
agreement,   or  if  Altair  or  WMU  shall   violate  any  of  the   covenants,
understandings or stipulations of this agreement, the aggrieved party shall give
written notice of the perceived  failure or violation to the other party. If the
violation  is not  cured  within  15 days  after  the  date of the  notice,  the
aggrieved  party shall  thereupon  have the right to terminate this agreement by
giving written notice to the other party of such  termination and specifying the
effective  date  thereof.  Such  notice  must be  delivered  15 days  before the
effective  date.  In the event  that such cause for  termination  shall lie with
Altair,  all facets of the project must be taken to a logical  stopping point, a
fiscal and technical  report  prepared,  and Altair shall be entitled to receive
just and equitable  compensation  for any work performed on the project.  Should
the cause of  termination  lie with WMU,  the  amount of  additional  work to be
carried out by Altair shall be subject to negotiation by all parties.

Section  10.       RECORDS. Altair shall maintain all books, documents,  papers,
accounting  records  and/or other  evidence  pertaining to costs  incurred for a
period  of at  least  five  years  from the date of  final  payment  under  this
agreement.  For  purposes  of  controlling  and  reporting  on the  receipt  and
disbursement of funds under this agreement,  Altair accounting  records shall be
structured  so  that  transactions  are  easily  and  readily  identifiable.  In
particular,  a "Documentation  of Personal  Services" form (Appendix D) shall be
completed  for each  employee  or  contractor  paid under this  agreement.  Such
materials shall be readily  available  during the agreement and retention period
for inspection,  audit and/or  duplication at all reasonable times by authorized
representatives  of WMU.  Altair shall send regular  summary  personnel  service
reports  regarding  the above to WMU while it is providing  services  under this
agreement.  The above  referenced  requirements  are  collectively  referred  to
hereafter as "record requirements."

Section 11.        ADDITIONAL  RESPONSIBILITIES  OF ALTAIR.  All of the services
performed under this agreement shall be in full compliance with the requirements
of the prime award  (attached  as Appendix  E).  Altair  shall  provide  readily
available  access to all  materials,  information,  and  records  to  authorized
representatives of WMU.

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         In the event that an expense for which  Altair has been  reimbursed  is
disallowed, Altair shall promptly repay WMU.

Section 12.        DISSEMINATION  OF  INFORMATION  AND   INTELLECTUAL   PROPERTY
RIGHTS.  News releases  pertaining to this  agreement or the services,  data, or
project to which it relates will not be made without prior written WMU approval.
No results of the project are to be released without prior written WMU approval.

         Except as required otherwise by the DOE Grant or agreed to otherwise by
WMU after August 14, 2003:  A) any  intellectual  property  (including,  but not
limited to, patents,  trademarks,  brand names and copyrights)  owned by a party
prior to August 14, 2003 or  developed  by a party  pursuant to an activity  not
governed by this agreement,  will remain the sole property of that party; B) any
intellectual  property  developed solely by a party in performing the activities
under this agreement shall remain the sole property of the developing party; and
C) if during this  agreement  the  parties  develop  any  intellectual  property
jointly,  each shall be entitled to thereafter use and benefit from such jointly
developed property without any accounting to the other joint developers.

         Altair  also  recognizes  and agrees that WMU's  intellectual  property
policy  will apply as to the rights of WMU and any of its  employees,  students,
and contractors  (except for Altair) working on any project or program funded by
this DOE grant. Upon request of the other party, Altair and WMU agree to execute
documents involving the assignment and/or acknowledgement of rights arising from
this  agreement  which are  consistent  with the terms of this  section and each
party's rights.

         To perform this Agreement,  it may be necessary for a party to disclose
to  the  other  party  information  of  a  confidential  or  proprietary  nature
("Confidential Information"). Except as required otherwise by the DOE Grant, the
parties  acknowledge that they have entered into a separate  "Mutual  Disclosure
and  Confidentiality  Agreement"  effective  October 26, 2002,  and the terms of
which are incorporated by reference into this agreement.  The provisions of this
Section shall survive any termination of this agreement.

Section 13.        EQUAL   EMPLOYMENT    OPPORTUNITY.    There   shall   be   no
discrimination  against any employee who is employed in the work covered by this
contract, or against any applicant for such employment, because of race, gender,
height,  weight,  color,  religion,  age,  sexual  orientation,  marital status,
veteran status,  handicap, or national origin. This provision shall include, but
not be limited to, the following:  employment,  upgrading, demotion or transfer,
recruitment or recruitment advertising,  layoff or termination,  rates of pay or
other  forms  of   compensation,   and   selection   for   training,   including
apprenticeship.

Section  14.       MICHIGAN  LAW.  The law of the State of Michigan  shall apply
exclusively  to every aspect of all  disputes  arising in  connection  with this
agreement. By execution of this agreement, Altair submits itself to the personal
jurisdiction  of the federal and state courts of Michigan.  However,  in case of
dispute,  WMU and Altair agree to first  discuss and  negotiate  any disputes or
claims prior to seeking  arbitration,  litigation,  or other formal adjudication
process.  If WMU and Altair  cannot  settle such dispute or claim by  themselves
within thirty (30) days,  or longer time as agreed by WMU and Altair,  after the
claim or dispute  arises,  WMU and Altair shall make good faith efforts to agree
on an alternate dispute resolution (ADR) process. If WMU and Altair cannot agree
on an ADR process within thirty (30) additional  days, each party shall have all
rights afforded to them by law and equity,  except as otherwise  limited by this
agreement.

Section 15.        NO  ASSIGNMENT.   This  agreement  may  not  be  assigned  or
otherwise  transferred  in whole or in part by Altair  without the prior written
consent of WMU. Any assignment made without such written consent will be void.

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Section 16.        AMENDMENTS.   This   agreement   constitutes   the   complete
understanding  of the parties hereto and any amendments to the agreement must be
agreed to in writing and signed by both parties.

Section 17.        SUBRECIPIENT  MONITORING.  A Subcontractor  receiving Federal
financial  assistance in excess of $500,000 during the fiscal year shall arrange
for  an  audit  by  an   independent   accountant  in  order  to  ascertain  the
effectiveness of the Subcontractor's  financial  management systems and internal
procedures established to meet the terms of the subcontract agreement.

         1.   If the  Subcontractor  is an  organization  subject to the uniform
              administrative  requirements  of OMB Circulars  A-110 or A-102 and
              arranges for audits that comply with OMB Circulars  A-128,  A-133,
              A-88 or equivalent  guidelines,  the  Subcontractor  shall provide
              Western  Michigan  University  with a letter stating that an audit
              has been  completed  and there were no findings,  or if there were
              findings, a reporting package as identified in OMB Circular A-133,
              subpart C, .320, paragraph C, within thirty (30) days of issuance.

         2.   The  Subcontractor  will  permit  auditors  (as defined in the OMB
              Circulars) to have access to the records and financial  statements
              as necessary to comply with the appropriate OMB Circulars and this
              Article.

         3.   The  Letter  of  Reporting  Package  should  be sent  to:  Western
              Michigan  University c/o David Ross,  Manager Office of Grants and
              Contracts 240W Walwood Hall MS 5425 Kalamazoo, Michigan 49008-5425

Failure  to  comply  with the  terms  of this  Article  may lead to  Subcontract
termination in accordance with Section 9 SIGNED ON BEHALF OF WMU


/s/ Dr. Subra Muralidharan                      Date: October 3, 2003
--------------------------------------------          ---------------
Dr. Subra Muralidharan (269) 387-3656


/s/ Lowell P. Rinker                            Date: October 3, 2003
--------------------------------------------          ---------------
Lowell P. Rinker, Assistant Treasurer
and Associate Vice President for Business
(269) 387-2368

SIGNED ON BEHALF OF ALTAIR

/s/ Kenneth E. Lyon                             Date: October 3, 2003
--------------------------------------------          ---------------
Kenneth E. Lyon, Vice President
for Business Development
(775) 858-3742