Phase One of CER's New Production Facility Is Completed on Schedule

SHANGHAI, Dec. 10, 2010 /PRNewswire-Asia/ -- China Energy Recovery Inc. (Pink Sheets: CGYV) ("CER"), an international leader in the design, fabrication, installation and servicing of waste heat energy recovery systems, announced today that it will complete Phase One construction at its new 15-acre production base in Yangzhou, Jiangsu Province, China, on schedule and will host an official dedication ceremony at the site on January 8, 2011.

The ceremony will include strategic investors and partners, customers and representatives from banks, state and local government officials and other supporting institutions along with CER employees and friends.

"We are extremely proud of our new facility, which significantly boosts production capability, lowers production costs and provides us the opportunity to expand our participation as a supplier of high-performance energy recovery systems to industry located in China and around the world," CER Chairman and Chief Executive Officer Qinghuan Wu, said. "We welcome all our partners in celebrating our good fortune at the dedication of our new facility in Yangzhou in January."

As previously announced, CER is carrying out its manufacturing capacity expansion at Yangzhou in two phases. With Phase One complete, the company has initiated Phase Two of its expansion plan, which will approximately triple the capacity of the new facility. With Phase Two complete in 2012, CER's site will stand as the largest single facility dedicated to the design and manufacture of energy recovery systems in China.

"CER is now in position to gain a greater share of the market," Mr. Wu said. "Growth in demand for energy recovery systems is accelerating as regulation and incentives are brought to bear on heavy industry globally to improve energy efficiency and environmental protection.

"Over the past six months, CER has expanded it sales effort to participate in and win a volume of projects consistent with our new production capacity. Current negotiations include consideration of sizeable Engineering, Procurement and Construction (EPC) projects for CER. We look forward to announcing our new contract wins throughout the new year."

Mr. Wu also stated that CER and its audit firm, PricewaterhouseCoopers, are focused on bringing the company's filings up to date as quickly as possible with the U.S. Securities and Exchange Commission.

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 as much as two-thirds of that wasted energy and converting it into usable heat energy or electricity, dramatically lowering energy costs. Energy recovery systems are also capable of lowering heat pollution and 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 engineering and manufacturing company that specializes in the design, construction and installation of waste heat energy recovery systems that captures and converts industrial waste energy produced by heavy industrial processes such as petroleum and chemicals refining, paper manufacturing and refining into low-cost electrical power, which enables industrial manufacturers to reduce their energy costs, shrink their emissions footprint and generate salable emissions credits. The company's primary focus is the Chinese market; however, CER's systems are operating in heavy industrial plants located in Egypt, Korea, Vietnam and Malaysia. CER is building China's first state-of-the-art, energy recovery system research and fabrication facility, which will allow CER to meet 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.

SOURCE China Energy Recovery Inc.