XI'AN, China, October 5, 2011 /PRNewswire/ -- China Recycling Energy Corp. (NASDAQ: CREG or "the Company"), a leading industrial waste-to-energy solution provider in China, today announced that the Company expanded its waste-to-energy project portfolio with the acquisition of a power generation system. Xi'an TCH Energy Technology Co., Ltd ("Xi'an TCH"), a wholly owned subsidiary of CREG, entered into an asset transfer agreement on September 28, 2011 with Shenqiu Yuneng Thermal Power Co., Ltd. ("Shenqiu") involving a set of 12 MW capacity power generation system. The transaction will be recognized in Q3 2011.
Under the assets transfer agreement, Xi'an TCH purchased a set of 12 MW biomass power generation system from Shenqiu for RMB 70 million (approximately $10,937,500 USD) following the company's completion of the conversion of Shenqiu's non-operating coal fired power generation system into a biomass power generation system. On the same date of purchase, Xi'an TCH leased the biomass power generation system to Shenqiu for a leasing period of 11 years under which the company receives monthly lease payments of 1.8 million RMB (approximately $281,250) for the entirety of the lease. Upon completion of the lease, Xi'an TCH will transfer the biomass power generation system to Shenqiu at zero cost. Shenqiu, the seller and the customer, is located in Shenqiu county, part of Zhoukou City in Henan Province, PRC.
With this acquisition, the Company now has 13 waste-to-energy projects in operation totaling 133 MW and 2 waste-to-energy projects under construction totaling 55 MW.
Mr. Guohua Ku, Chief Executive Officer of CREG, commented, "The acquisition of this power generation project is a very exciting development for CREG and our new customer, Shenqiu. The government led consolidation of small players in the coking industry as well as rising coal prices has resulted in the shutting down of numerous coking plants and their power generation capabilities--such is the case with Shenqiu. We are pleased to be able to acquire this power generation system and make it operational again as an eco-friendly system fueled off local agriculture and biomass waste. This system integration not only expands our technological capabilities and aptitude in this area but also contributes to our growing recurring revenue stream of interest income on sales-type leasing beginning in the fourth quarter 2011. We look forward to updating our investors and the community as more projects developments are announced."
For more information on this press release, please refer Form 8-K filed with the Securities and Exchange Commission today, October 4, 2011.
About China Recycling Energy Corp.
China Recycling Energy Corp. (NASDAQ: CREG or "the Company") is based in Xi'an, China and provides environmentally friendly waste-to-energy technologies to recycle industrial byproducts for steel mills, cement factories and coke plants in China. Byproducts include heat, steam, pressure, and exhaust to generate large amounts of lower-cost electricity and reduce the need for outside electrical sources. The Chinese government has adopted policies to encourage the use of recycling technologies to optimize resource allocation and reduce pollution. Currently, recycled energy represents only an estimated 1% of total energy consumption and this renewable energy resource is viewed as a growth market due to intensified environmental concerns and rising energy costs as the Chinese economy continues to expand. The management and engineering teams have over 20 years of experience in industrial energy recovery in China. For more information about CREG, please visit http://www.creg-cn.com.
Safe Harbor Statement
This press release may contain certain "forward-looking statements" relating to the business of China Recycling Energy Corp. and its subsidiary companies. All statements, other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
For more information, please contact:
In China:
Mr. Leo Wu
Investor Relations
China Recycling Energy Corp.
Tel: +86-29-8765-1096
Email: tch@creg-cn.com
In USA:
Mr. Howard Gostfrand
Investor Relations
American Capital Ventures, Inc.
Tel: +1-305-918-7000
Email: info@amcapventures.com
