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China Energy Recovery Completes a $1.4 Million Export Order of a 3MW Biomass Boiler System for a Paper Mill in Malaysia

2009-07-07 17:47 1134

SHANGHAI, July 7 /PRNewswire-Asia/ --

-- Total contract value amounts to US$1.43 million

-- System turns palm shell waste into economically sound bio-fuel

China Energy Recovery, Inc. (OTC Bulletin Board: CGYV) (ISIN: US16943V2060), a leader in the waste heat energy recovery sector of the industrial energy efficiency industry, today announced that the company has completed a biomass boiler system for EKO-PP Paper Mill, the first paper mill to utilize palm shell to produce pulp and paper in Malaysia. The total contract value of the system amounts to RMB 9.8 million (approximately US$1.43 million) and the revenue to be recognized in Q2 2009 according to US GAAP would amount to roughly RMB7.67 million (approximately US$1.12 million).

The system will utilize the massive palm shell waste out of the

pulp-making process as fuel for combustion to generate steam to further power the turbines for electricity generation. The designed power generation capacity is 3MW. This not only helps address the need to treat palm shell waste and solve the associated environmental issues, but also turns it into a type of economically sound bio-fuel.

"This is our first biomass boiler system to export out of China," commented Mr. Qinghuan Wu, Chairman and CEO of China Energy Recovery. "Though we are continuing to concentrate on waste heat energy recovery, our strong technological and engineering capabilities have enabled us to expand into other relevant alternative energy and energy efficiency market segments both inside China and overseas. Biomass fuel is one of such market segments. It has great opportunities in developing countries such as those in southeastern Asia. The completion of this order has demonstrated our capabilities to serve the special regional needs and is expected to aid our further expansion in such fast growing overseas markets."

The contract value presented above includes a 17% value added tax ("VAT") and an 8% retainage for product warranty purpose. According to US GAAP, VAT and the retainage are excluded from the current period for revenue recognition purpose and the retainage will be recognized as deferred revenue. The numbers presented represent values based on current exchange rates. Changes in the currency exchange rates would result in a commensurate change in contract value.

What is Waste Heat Energy Recovery?

Industrial facilities release significant amounts of excess heat into the atmosphere in the form of hot exhaust gases or high-pressure steam. Energy recovery is the process of recovering vast amounts of that wasted energy and converting it into usable heat energy or electricity, dramatically lowering total energy costs. Energy recovery systems are also capable of capturing harmful pollutants that would otherwise be released into the environment. It is estimated that if energy currently wasted by all the U.S. industrial facilities could be recovered, it could produce power equivalent to 20% of U.S. electricity generation capacity without burning any additional fossil fuel, and could help many industries to meet stringent environmental regulations.

About China Energy Recovery, Inc.

CER is an international leader in designing, manufacturing and installing waste heat energy recovery systems which provide facilities with greater energy efficiency. The company's primary focus is on the Chinese market. CER's technology captures industrial waste energy to produce low-cost electrical power, enabling industrial manufacturers to reduce their energy costs, shrink their emissions footprint, and generate sellable emissions credits. CER has deployed its systems throughout China and in such international markets as Egypt, Korea, Vietnam and Malaysia. CER focuses on numerous industries in which a rapid payback on invested capital is achieved by its customers, including: chemical, paper manufacturing, refining (including methanol refining), etc. CER continues to invest in R&D and plans to build China's first state-of-the-art energy recovery system research and fabrication facility to allow it to meet the increased demand for its products and services. For more information on CER, please visit: http://www.chinaenergyrecovery.com/s/Home.asp . Information on CER's website does not comprise a part of this press release.

Forward-Looking Statement Disclaimer

This press release includes "forward-looking statements" within the meaning of the Securities Litigation Reform Act of 1995, as amended. All statements, other than statements of historical fact, included in the press release that address activities, events or developments that CER believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on certain assumptions made based on experience, expected future developments and other factors that CER believes are appropriate under the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of CER and may not materialize, including, without limitation, the efficacy and market acceptance of CER's products and services, CER's ability to execute on its business plan and strategies and CER's ability to successfully complete orders and collect revenues therefrom. Investors are cautioned that any such statements are not guarantees of future performance. Actual results or developments may differ materially from those projected in the forward-looking statements as a result of many factors. Furthermore, CER does not intend (and is not obligated) to update publicly any forward-looking statements, except as required by law. The contents of this release should be considered in conjunction with the warnings and cautionary statements contained in CER's filings with the Securities and Exchange Commission, including CER's Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 30, 2009.

For more information, please contact:

Media

Sean Mahoney

Tel: +1-310-867-0670

Investor Relations

Jim Blackman

Tel: +1-713-256-0369

Source: CHINA ENERGY RECOVERY, INC.
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