Lizhan Environmental Announces the Launch of the Production of its New Evergreen Leather Products

TONG XIANG, Zhejiang, China, March 16, 2011 /PRNewswire-Asia/ -- Lizhan Environmental Corporation ("Lizhan" or the "Company") (Nasdaq: LZEN), a China-based supplier of collagen fiber and other fabrics manufactured from recycled leather waste, announced today that it has successfully launched the production of its first end product Evergreen Product production line.

This development puts the company in the forefront of China's eco-friendly leather manufacturing industry. This patented product is expected not only to generate high economic benefit but also to mitigate the inevitable waste of scratch leather generated during the leather manufacturing process and alleviate the negative environmental impact of such waste. Evergreen Productions are eco-friendly, bacteria and fire resistant textile, which can be used in a wide range of applications such as furniture, automotive upholstery and garments. The company anticipates generating revenue from sales of Evergreen Products beginning in the quarter ending June 30, 2011, subject to customers' inspection of, and satisfaction with, the quality of the materials. It is expected that the Evergreen Products to be produced by this production line will generate sales in fiscal year 2011 that represent a portion of the advance sales purchase orders received by the Company, which orders amount to approximately $32.5 million in the aggregate. In light of the previously disclosed delays and increased costs in constructing the Evergreen Product facility and installing the first Evergreen Product production line, the Company is currently evaluating the timing of the installation of its next production line and the type of products to be manufactured using such production line.

"We are very proud to be the first to introduce a revolutionary product, the Evergreen Product, which is expected to generate higher margins than our existing products, to the leather market. These new products can provide the company with significant benefits such as higher price premiums and greater market share in China's leather industry. At the same time, we are currently testing for other industrial applications and uses of collagen fiber," said Mr. Jianfeng Liu, Lizhan's Chairman and CEO.

About Lizhan Environmental Corporation

Lizhan Environmental Corporation manufactures, distributes and markets environmentally-friendly collagen fiber and other fabrics from recycled leather waste. The Company's products are mainly used in furniture, garment, automotive and other consumer applications.

Safe Harbor Statements

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including risks outlined in the Company's public filings with the Securities and Exchange Commission, including the Company's annual report on Form 20-F. All information provided in this press release is as of the date of this release. Except as required by law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.