the latest grunt-express does not work

I am trying to setup my environment to do some client side development. It is supposed to be nodejs based. I was recommended grunt-express as the component to configure the development server.

The problem I have is that the latest version (0.3.6) does not work and I am not sure is this because I am doing something stupid with the configuration or this is a bug introduced in the latest version.

Here is what I have:

The Gruntfile.js

'use strict';

module.exports = function(grunt) {

 var path = require('path');

 grunt.initConfig({
    express: {
      server: {
        options: {
          port:   3005,
          bases:  path.resolve('public'),
          debug: true
        }
      }
    }
  });

 grunt.loadNpmTasks('grunt-express');

 grunt.registerTask('start', ['express', 'express-keepalive']);
}

The package.json:

{
  "name": "MvcTemplate",
  "version": "0.0.1",
  "engines": {
     "node": ">0.8"
   },
  "private": true,
  "dependencies": {
    "grunt": "~0.4",
    "grunt-express": "~0.2"
  }
}

when I run grunt start the version of the package as specified above works fine - the server is started and responds to the requests as expected.

But if I switch to the latest version (0.3.6) when I run the grunt start or grunt express all I am getting is a constant stream of the messages CreateProcessW: The system cannot find the file specified.

So - is it me being stupid or something is wrong with the package?