China Energy

China Energy achieves record net profit of RMB64.7 million in 3Q2007 ·

Net profit rose 26% while revenue improved 37%, on the back of higher Dimethyl Ether (“DME”) sales · Gross margin improved from 36.3% in 3Q2006 to 37.7%in 3Q2007 · New capacity expansion at end of year will increase existing production capacity by 50% Singapore.

05 November 2007 - China Energy Limited , China’s largest producer of Dimethyl Ether (“DME”) – an environmentally-friendly and cost efficient alternative fuel, achieved a record net profit of RMB64.7 million in 3Q2007. This is a 26% increase as compared to the net profit in 3Q2006.

Revenue for 3Q2007 rose 37% to RMB232 million, mainly due to the higher DME sales achieved. Sales volume for DME increased from 22,900 metric tons in 3Q2006 to 50,300 metric tons in 3Q2007, on the back of new capacity recently added in 3Q2007. Overall, gross margin also improved from 36.3% in 3Q2006 to 37.7% in 3Q2007.

Going forward, the Group expects the demand for Dimethyl Ether (DME) to remain strong. The Group is also in the midst of setting up new DME production facilities at Zhangjiagang, Jiangsu Province, China. This additional 300,000 metric tons per annum (“mtpa”) of new capacity is expected to complete by the end of this year. This will increase the existing DME production capacity by 50%, bringing the total DME capacity to 900,000 mtpa by the end of 2007.