China Integrated Energy, Inc. Procured $12.7 Million of Production Equipment for the New 50,000 Ton Second-Generation Biodiesel Production Facility

XI'AN, China, May 17 /PRNewswire-Asia-FirstCall/ -- China Integrated Energy, Inc. (Nasdaq: CBEH; China Integrated Energy" or the "Company"), a leading non-state-owned integrated energy company in the People's Republic of China, announced today that it has secured production equipment for its new 50,000 ton biodiesel production facility currently being constructed in Tongchuan City, Shaanxi Province. The equipment, which will be used for producing high-quality second-generation biodiesel, incorporates new technologies using a variety of low-cost feedstock resulting in lower production costs for China Integrated Energy.

The new production facility is being constructed adjacent to the Company's existing 100,000 ton biodiesel production facility and will expand the Company's production capacity to 150,000 metric tons. Installation of the equipment at the new biodiesel facility is expected to be completed by the third quarter of 2010, with production commencing in the fourth quarter. The facility is expected to be operating at 60-70% of capacity in the first quarter of 2011, and ramping up to 80-90% utilization rate in the second quarter of 2011. For full-year 2011, the new facility is expected to contribute at least $27 million and $9 million in revenue and net income, respectively.

The Company's advanced production technology at its second-generation biodiesel facility is estimated to reduce production costs by 20%. In addition to the feedstock used in the first-generation facility (i.e. non-edible seeds, waste cooking oil), the new second-generation facility can utilize a diverse supply of raw materials, such as crop straw (wheat straw, corn straw, cotton straw, weed, etc.), agricultural waste (tree branches, tree leaves), as well as organic waste, providing China Integrated Energy with better input cost controls while ensuring optimal capacity utilization. Additionally, the Company's second-generation biodiesel meets Europe IV fuel standards and can be mixed with both diesel and first-generation biodiesel at any ratio. Furthermore, the new technology is able to recycle unused feedstock and water used in the production process, meeting the Company's environmental goals while delivering further cost reductions. China currently produces 1.3 billion tons in organic waste annually.

The cost of the equipment represents approximately 85% of the production plant's total $15.0 million construction budget, with the remaining $2.3 million allocated for site preparation and infrastructure on the land, which the Company holds a 15-year lease. The equipment is being exclusively offered to China Integrated Energy in China by two Japanese companies, Shinwa Shouji Co., Ltd ( http://www.shinwa-shouji.com ) and Micro Energy Co. ( http://www.microenergy.co.jp ), as well as several domestic equipment suppliers. The Company reserves the right to order additional equipment in the future to meet future expansion plans.

"The procurement of this advanced biodiesel production and processing equipment for our new 50,000 facility is a major milestone in our Company's strategy to become a leading producer of alternative fuels sources," stated Mr. Gao Xincheng, Chief Executive Officer of China Integrated Energy, Inc. "This technology, which is proprietary to China Integrated Energy, will position us as leader in the market with high-quality, competitively priced second-generation biodiesel that can be made from a diverse feedstock. Our new biodiesel facility will significantly increase our production capacity while realizing greater yields and significant cost savings, which will generate higher incremental revenue and expand both gross and operating margins."

About China Integrated Energy, Inc.

China Integrated Energy, Inc. is a leading non-state-owned integrated energy company in the PRC engaged in three business segments: the wholesale distribution of finished oil and heavy oil products, the production and sale of biodiesel, and the operation of retail gas stations. The Company's primary business segment is the wholesale distribution of finished oil and heavy oil products. The Company also operates a 100,000-ton biodiesel production plant with an additional 50,000-ton biodiesel production plant under construction, and twelve retail gas stations in China.

Safe Harbor Statement

This press release includes statements that may constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. For example, statements about the future use of the proceeds are forward looking and subject to risks. China Integrated Energy, Inc. may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission on forms 10-K, 10-Q and 8-K, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. Forward- looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, risks outlined in the Company's filings with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

    For more information, please contact:

    Company
     Susan Zhou
     Vice President, Investor Relations
     Tel:   +1-305-393-5536
     Email: [email protected]

    HC International, Inc.
     Ted Haberfield, Executive VP
     Tel:   +1-760-755-2716
     Email: [email protected]
     Web:   http://www.hcinternational.net

SOURCE China Integrated Energy, Inc.

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