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|                             |  | The Empire State Building
|---------------------------- |  | -------------------------
|350 Fifth Avenue, Suite 3018
|New York, NY 10118          
|Telephone: (212) 375-2950   
|Facsimile: (212) 931-9339   

Confidential



September 28, 2007

Dynamotive Energy Systems CorporationAndrew
Kingston President and CEO Angus Corporate Centre 1700 West 75th
Avenue, Suite 230 Vancouver BC Canada V6P 6G2

Re:      Financial Advisory
Agreement

Dear Mr. Kingston:

Based on our discussions, we are pleased to confirm the
arrangements under which, Ardour Capital Investments LLC, (Ardour or
Advisor) will be engaged by Dynamotive Energy Systems Corporationtogether with its subsidiaries and affiliates (DYMTF or Company), to act
as the Company's exclusive financial advisor (Financial Advisor) with respect
to assessing and accessing the capital markets. The term of this agreement shall
commence on September 28, 2007.

| | 1. | As Financial Advisor, Ardour agrees to assist and advise
      the Company with respect to the specific financing (Financing) as agreed
      by email between Ardour Capital and Mr. Andrew Kingston, today, September
      28, 2007. The Financing is for a specific USD 10MM in a private
      transaction.                                                                                                                                                                                                                                                                                                                                                                                   
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | 2. | Ardour shall serve as exclusive financial advisor and
      placement agent for a period of 60 days for the Financing. Ardour further
      recognizes that DYMTF is in discussions with other agents. Ardour is a
      registered securities dealer.                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | 3. | Advisor agrees to act as the placement agent or
      underwriter for the Company in connection with a proposed institutional
      equity financing transaction. Ardours fees for acting in that capacity
      shall include a cash commission of 7% plus a five year warrant to purchase
      4% of the Common Stock sold at the financing valuation of $0.9215 per
      share.                                                                                                                                                                                                                                                                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | 4. | Notwithstanding the termination of this agreement through
      the passage of time or otherwise, if Ardour introduces DYMTF to an
      individual contact not previously known to DYMTF during the term of this
      agreement and DYMTF and that contact enter into a transaction within 18
      months after the date of the introduction, Ardour shall be entitled to
      receive the compensation provided in this agreement. In the event that
      another broker claims responsibility for such a transaction, however,
      DYMTF may appoint an impartial arbiter to determine the allocation of the
      permissible commission payments between Ardour and such other
    broker.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | 5. | In addition to the fees payable hereunder and regardless
      of whether any transaction or financing is proposed or consummated, the
      Company shall reimburse Ardour for all reasonable travel and
  out-                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

|Ardour Capital
      Investments, LLC
|-------------------------------------

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| | 
| | 

| |     | of-pocket expenses incurred by Ardour in connection with
      the performance of its services hereunder, including without limitation,
      hotel, food and associated expenses and long-distance telephone calls up
      to a maximum of $1,000 per month; any expenses over $1,000 per month
      (Including counsel fees) shall require the prior approval of the Company,
      which will not be unreasonably withheld. Such expenses shall be submitted
      by Ardour on a monthly basis, together with originals of receipts and
      other documentation supporting all expenditures in excess of $25, in
      accordance with Company policy, and will reimbursed by Company promptly
      upon receipt.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | 6.  | In connection with Ardours activities on the Company's
      behalf, the Company will furnish Ardour with all information that it may
      reasonably request and will provide Ardour reasonable access to the
      officers, directors, accountants and counsel of the Company under the
      direction of a Company representative.                                                                                                                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | 7.  | The Company acknowledges that Ardour makes no commitment
      whatsoever as to making a market in the Company's securities or to
      recommending or advising its clients to purchase the Company's securities.
      Ardour acknowledges that the Company shall have the absolute right in its
      sole discretion to determine whether to proceed with any financing or to
      accept any individual investor.                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | 8.  | The Company agrees that Ardour has the right to place
      advertisements in financial and other newspapers and journals describing
      its services to the Company hereunder following review and approval by the
      Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | 9.  | Ardour will act under this agreement as an independent
      contractor with duties to the Company. Because Ardour will be acting on
      the Company's behalf in this capacity, it is Ardours practice to receive
      and give mutual indemnification. A copy of Ardours standard
      indemnification form is attached to this letter agreement as Appendix A,
      and is incorporated herein. It is expressly understood and agreed to by
      the parties hereto that Ardour shall have no authority to act for,
      represent or bind the Company or any affiliate thereof in any manner,
      except as may be agreed to expressly by the Company in writing from time
      to time.                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | 10. | Any notice or communication permitted or required
      hereunder shall be in writing and shall be deemed given upon receipt and
      shall be (i) hand-delivered; (ii) sent postage prepaid by registered mail,
      return receipt requested, or (iii) sent by confirmed facsimile, to the
      respective parties as set forth below, or to such other address as either
      party may notify the other in writing:                                                                                                                                                                                                                                                                                               

| | If the Company, to:    | Dynamotive Energy Systems Corporation         
| | ---------------------- | ----------------------------------------------
| |                        | Angus Corporate Centre                        
| |                        | 1700 West 75th Avenue, Suite 230              
| |                        | Vancouver BC                                  
| |                        | Canada V6P 6G2                                
| |                        | Attn: Andrew Kingston, Chief Executive Officer
| |                        |                                               
| |                        |                                               
| | If to the Advisor, to: | ARDOUR CAPITAL INVESTMENTS                    
| |                        | The Empire State Building                     
| |                        | 350 5thAvenue, Suite 4812                     
| |                        | New York, NY 10118                            
| |                        | Attn: Kerry J Dukes, Chief Executive Officer  
| |                        | Phone 212.375.2957                            

|Ardour Capital
      Investments, LLC | 2 | 
|------------------------------------- | - | 

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| | 
| | 

| | 11. | This letter agreement shall be binding upon and inure to
      the benefit of each of the parties hereto and their respective successors,
      legal representatives and assigns. No provision of this letter agreement
      may be amended, modified or waived, except in a writing signed by all of
      the parties hereto.                                                                                                                                                                                                                                                                                                                             
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | 12. | This letter agreement shall be construed in accordance
      with and governed by the laws of the State of New York, without giving
      effect to its conflict of law principles. Each of the Company and the
      Advisor agrees that any controversy or claim arising out of or relating to
      this letter agreement, or the breach thereof, shall be settled by
      arbitration administered by the American Arbitration Association in New
      York, New York, in accordance with its Commercial Arbitration Rules, and
      judgment on the award rendered by the arbitrator(s) may be entered in any
      court having jurisdiction thereof.

If the terms of our engagement as set forth in this letter are
satisfactory to you, kindly sign and date the enclosed copy of this agreement
and the indemnification form thereto as Exhibit A and return them to us.

Very truly yours,

ARDOUR CAPITAL INVESTMENTS

By: /s/ Kerry J. Dukes
                 
  Name: Kerry J. Dukes 
                 
  Title: Chief Executive Officer

ACCEPTED AND AGREED TO:



By: /s/ R Andrew Kingston
                     
  Name: R. Andrew Kingston
                     
  Title: President and CEO

|Ardour Capital Investments,
      LLC | 3 | 
|------------------------------------- | - | 

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| | 

Exhibit A

Gentlemen:

This letter will confirm that we have engaged Ardour Capital
Investments LLC (Advisor) to advise and assist us in connection with the matters
referred to in our letter agreement dated _______________ (Engagement Letter").
In consideration of your agreement to act on our behalf in connection with such
matters, we agree to indemnify and hold harmless you and your affiliates and you
and their respective officers, directors, employees and agents and each other
person, if any, controlling you or any of your affiliates (you and each such
other person being an "Indemnified Person") from and against any losses, claims,
damages or liabilities related to, arising out of or in connection with, the
engagement (the "Engagement") under the Engagement Letter, and will reimburse
each Indemnified Person for all expenses (including reasonable fees and expenses
for one counsel) as they are incurred in connection with investigating,
preparing, pursuing or defending any action, claim, suit, investigation or
proceeding related to, arising out of or in connection with the Engagement,
whether or not pending or threatened and whether or not any Indemnified Person
is a party. We will not, however, be responsible to any Indemnified Person for
any losses, claims, damages or liabilities (or expenses relating thereto) that
are finally judicially determined to have resulted from the willful misconduct
or negligence of such Indemnified Person. We also agree that no Indemnified
Person shall have any liability (whether direct or indirect, in contract or tort
or otherwise) to us for or in connection with the Engagement except for any such
liability for losses, claims, damages or liabilities incurred by us that are
finally judicially determined to have resulted from the willful misconduct or
negligence of such Indemnified Person.

We will not, without your prior written consent, settle,
compromise, consent to the entry of any judgment in or otherwise seek to
terminate any action, claim, suit or proceeding in respect of which
indemnification may be sought hereunder (whether or not any Indemnified Person
is a party thereto) unless such settlement, compromise, consent or termination
includes a release of each Indemnified Person from any liabilities arising out
of such action, claim, suit or proceeding. No Indemnified Person seeking
indemnification, reimbursement or contribution under this agreement will,
without our prior written consent, settle, compromise, consent to the entry of
any judgment in or otherwise seek to terminate any action, claim, suit,
investigation or proceeding referred to in the preceding paragraph.

If the indemnification provided for in the first paragraph of
  this agreement is judicially determined to be unavailable (other than in accordance
  with the third sentence of the first paragraph hereof) to an Indemnified Person
  in respect of any losses, claims, damages or liabilities referred to herein,
  then, in lieu of indemnifying such Indemnified Person hereunder, we shall contribute
  to the amount paid or payable by such Indemnified Person

|Ardour Capital Investments,
      LLC | 4 | 
|------------------------------------- | - | 

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| | 
| | 

as a result of such losses, claims, damages or liabilities (and
expense relating thereto) (i) in such proportion as is appropriate to reflect
the relative benefits to you, on the one hand, and us, on the other hand, of the
Engagement or (ii) if the allocation provided by clause (i) above is not
available, in such proportion as is appropriate to reflect not only the relative
benefits referred to in such clause (i) but also the relative fault of each of
you and us, as well as any other relevant equitable considerations; provided,
however, in no event shall your aggregate contribution to the amount paid or
payable exceed the aggregate amount of fees actually received by you under the
Engagement Letter. For the purposes of this agreement, the relative benefits to
us and you of the Engagement shall be deemed to be in the same proportion as (a)
the total value paid or contemplated to be paid or received or contemplated to
be received by us, our affiliates and/or our shareholders, officers and/or
directors as the case may be, in the transaction or transactions that are the
subject of the Engagement, whether or not any such transaction is consummated,
bears to (b) the fees paid to you in connection with the Transaction.

The provisions of this agreement shall apply to the Engagement
and any modification thereof and shall remain in full force and effect
regardless of any termination or the completion of your services under the
Engagement Letter.

This agreement and the Engagement Letter shall be governed by
and construed in accordance with the laws of the State of New York applicable to
contracts executed and to be performed in that state.

Very truly yours,

Dynamotive Energy Systems
Corporation

By: /s/ R Andrew Kingston
          Name: R. Andrew Kingston
          Title: President and CEO

ACCEPTED AND AGREED TO:
  as of _________, 2007

Ardour Capital Investments LLC

By: /s/
        Name: 
        Title:

|Ardour Capital Investments,
      LLC | 5 | 
|------------------------------------- | - | 

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