China Energy Recovery Secures an $8.9 Million Contract for a Heat Recovery System Retrofit Project for Jiangsu Sopo Chemical
January 27 2009 - 7:00AM
PR Newswire (US)
- China's largest producer of acetic acid returns to China Energy
Recovery for greater energy efficiency SHANGHAI, China, Jan. 27
/PRNewswire-Asia/ -- China Energy Recovery, Inc. (OTC Bulletin
Board: CGYV - ISIN: US16943V2060; "CER"), a leader in the waste
heat energy recovery sector of the industrial energy efficiency
industry, announced today that it has recently entered into an EPC
(Engineering, Procurement and Construction) contract for a retrofit
project (the "Project") to build a new low temperature heat
recovery system (the "System") for the sulfuric acid plant of
Jiangsu Sopo Chemical Group ("Sopo Group"). Sopo Group is a leading
Chinese integrated chemical company and China's largest producer of
Acetic Acid (Glacial), one of the major basic chemicals for
industrial uses. The Project is arranged as a sales-type lease
which offers the company higher margin compared to regular EPC
projects. The currently determined total contract value amounts to
RMB60.8 million (roughly $8.9 million USD at the prevailing
exchange rate on the date of the release) with a 4-year installment
payment term. The main low temperature heat recovery system for the
Project will be specially procured from MECS, Inc., a leading
US-based company specializing in sulfuric acid manufacturing
equipment and systems and formerly part of Monsanto. CER partners
with MECS to provide the low temperature heat recovery systems for
sulfuric acid plants in China. The primary purpose of the System is
to utilize the waste heat released from the sulfuric acid
production process and to use it to supply the main facilities with
the hot steam, which would otherwise have to be supplied from
coal-fired generators. Through this process, not only are energy
costs significantly reduced but Sopo Group is able to meet strict
environmental protection requirements. It is estimated that upon
completion in early 2010, the System will help Sopo Group save
roughly 17,000 tons of coal (coal equivalent), which would
otherwise be required to produce the same amount of hot steam, and
thus prevent the release of approximately 45,000 tons of carbon
dioxide emission each year. Moreover, approximately 200,000 tons of
cooling water will also be saved annually. "Sopo Group has been a
long-time customer of CER," stated CER's CEO, Mr Qinghuan Wu. "We
are happy they continue to see the benefits that waste energy
recovery can provide and have returned to us to build the new
project. This project is important to CER as it demonstrates our
customers' recognition of CER's strong engineering capability in
carrying out EPC projects for energy recovery systems. We are also
pleased to continue to partner with MECS to utilize their superior
technology in low temperature heat recovery for sulfuric acid
plants. The Project presents a robust start of the year for CER in
2009. We shall continue to strive to provide the best value to our
customers, especially in this current economic environment, because
it is the corner stone of our sustained long term growth." The
number presented above is the total contract value, which includes
a 17% Value Added Tax ("VAT") on the domestically purchased
equipment, the retainage amount for product warranty purposes which
is 5% of the total contract value and will be recognized as
deferred revenue, and the interest income due to the sales-type
lease arrangement. The total contract value would be increased to
RMB71.2 million (roughly $10.4 million USD) if the Customs Duty and
import VAT would not be exempted. 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 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, 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 SEC,
including CER's Current Report on Form 8-K filed with the
Securities and Exchange Commission on April 21, 2008. Contact:
Media Sean Mahoney Ph. 310.867.0670 Investor Relations Jim Blackman
Ph. 713.256.0369 DATASOURCE: China Energy Recovery, Inc. CONTACT:
Media, Sean Mahoney, +1-310-867-0670, , or Investor Relations, Jim
Blackman, +1-713-256-0369, , both for China Energy Recovery, Inc.
Web Site: http://www.chinaenergyrecovery.com/s/Home.asp
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