TDEL technology aims to be lower cost and higher quality than existing flat panel TVs

Toronto, Canada – January 3, 2006 – The Westaim Corporation today announced that its iFire Technology Corp. subsidiary’s pilot production facility is operational. The pilot facility is intended to produce engineering samples of high-definition 34-inch flat panel display modules based on its proprietary thick dielectric electroluminescent (TDEL) technology and to simulate manufacturing in a commercial environment.

“We have had excellent early output of TDEL panels from the initial runs through the pilot plant,” said Barry M. Heck, President & CEO of Westaim. “As we continue to ramp up pilot production we will be sharing TDEL displays produced in the pilot with OEMs (original equipment manufacturers) and potential partners for their evaluation. iFire intends to begin demonstrating displays early this year.”

The US$35-million pilot facility was completed on time and on budget. Through pilot production, iFire intends to complete the baseline processes for the manufacture of its displays and focus on continual improvements to both performance and manufacturing efficiency.

“As an emissive display technology, TDEL will offer a viewing experience that is much closer to the CRT and superior to other flat panel TV technologies,” said Nick Khoury, President of iFire. “In addition to better picture quality and a thinner, lighter form factor, TDEL offers lower capital investment and has a potential 30 to 40 percent manufacturing cost advantage compared to other technologies, which will translate into more affordable consumer products.”

iFire expects to commercialize its technology in partnership with industry leaders and plans to initially target the 30- to 45-inch screen size television segment. The pilot plant will provide information and experience to allow iFire to work with partners to construct and operate the first volume production facility. Initial planning work for this facility is under way.

iFire Technology Corp. has developed a flat panel display with low cost and high performance potential called thick dielectric electroluminescent technology (TDEL). With superior video performance characteristics and a substantial manufacturing cost advantage over other flat panel display technologies, iFire’s proprietary TDEL technology has the potential to become an affordable, high performance alternative for the mass consumer flat panel television market. iFire plans to initially target the 30- to 45-inch screen size segment of the flat panel television market in partnership with major consumer electronics companies.

In addition to iFire Technology, The Westaim Corporation’s technology investments include NUCRYST Pharmaceuticals Corp. (NASDAQ: NCSTV; TSX: NCS), which develops, manufactures and commercializes medical products that fight infection and inflammation based on its nanocrystalline silver technology. Westaim's common shares are listed on NASDAQ under the symbol WEDX and on The Toronto Stock Exchange under the trading symbol WED.

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For more information please contact:

David Wills, Investor Relations 

The Westaim Corporation                                                        

(416) 504-8464                                                                      

info@westaim.com                                                      

www.westaim.com                  

This news release contains forward looking statements about iFire’s pilot facility, its use to produce engineering samples of its flat panel display, the performance and cost characteristics of prospective flat panel display product, expected experience and information resulting from operating the pilot plant and its desire to partner with industry leaders.  These statements are based on current expectations that are subject to risks and uncertainties, and neither Westaim nor iFire can give any assurance that these expectations are correct. Various factors could cause actual results to differ materially from those projected in such statements, including but not limited to hurdles in scaling the process to commercial volumes, the willingness of potential industry partners to enter into such relationships and competitive product manufacturing cost improvements. Westaim and iFire disclaim any intention or obligation to revise forward-looking statements whether as a result of new information, future developments or otherwise. All forward-looking statements are expressly qualified in their entirety by this cautionary statement.