CER completes $1.42M contract for Yangfeng

China Energy Recovery completed two waste heat recovery systems for Hubei Yangfeng Group for US$1.42 million. About US$1.22 million will be recognised by CER in Q3 2009, according to US GAAP.

The completed systems are designed to generate 120 tons of steam per hour, which translates into nearly 24MW of thermo power generation capacity. These systems will help Yangfeng achieve an estimated annual saving of up to 57,100 tons of coal and reduce carbon dioxide emissions by up to 151,700 tons.

Yangfeng is one of China's largest producers of phosphate fertilizer, which is used widely in agriculture. Globally, China is the largest producer of phosphate fertilizers and is also the largest market for these basic goods.

"We are very pleased to have completed these waste heat recovery systems for Yangfeng, which is an important repeat customer of CER," said Mr. Qinghuan Wu, Chairman and CEO of China Energy Recovery.

"China remains a big agricultural country, and the demand for fertilizer is substantial," said Mr. Qinghuan Wu, Chairman and CEO of China Energy Recovery. "With Chinese government's regulations mandating greater environmental protection and energy savings, it is becoming crucial for fertilizer producers to include waste heat recovery systems in their facilities. This is a market segment we have been focusing on and expect to have continued growth," he added.

The contract value presented above includes a 17 percent value added tax and a 5 percent retainage for product warranty purpose. According to US GAAP, VAT and the retainage are excluded for revenue recognition purpose for the current period and the retainage will be recognised 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.