China Energy Corporation Continues Expansion Strategy

China Energy Corporation, a leading producer of coal, heat, and electricity in Inner Mongolia, China, is pleased to provide this corporate update regarding its operations.

“Our persistent focus on expanding our production of coal, heat, and electricity has positioned the Company to take full advantage of the major economic transformation and urban migration now taking place within Inner Mongolia,” said Mr. WenXiang Ding, President of China Energy. “We expect demand and pricing for coal, heat, and electricity to remain high as we enter the traditionally cold winter season in northern China.”

As part of China Energy’s ongoing expansion strategy, Inner Mongolia TeHong Coal and Power Co. Ltd., a wholly owned subsidiary of the Company, continues to enhance its production facilities and intends to increase its annual coal production capacity by 80% to 900,000 tons from the current production rate of 500,000 tons. Inner Mongolia TeHong Coal and Power Co. Ltd. was recently named one of the top 20 Chinese coal producers by the China Coal Industry Association.

Inner Mongolia Zhunger County Heat Power Co. Ltd., the Company’s other wholly owned subsidiary, continues to enjoy a government granted monopoly in the heating market for the XuanJiaWan District in Inner Mongolia. Completed in 2006, their modern thermoelectric power plant and six heat transfer stations have increased heating capacity in the area by over 150 times. The Company intends to leverage upon this success and to utilize its established industry and government relationships to expand into new power supply opportunities in the region.

China Energy Corporation, through its wholly owned subsidiaries, is a leading producer of coal, heat, and electricity in China. The Inner Mongolia TeHong Coal and Power Co. Ltd. operates the LaiYeGou Coal Mine with a current production rate of 500,000 tons per year. The Inner Mongolia Zhunger County Heat Power Co. Ltd. operates a modern thermoelectric heating and power generation plant, along with six heat transfer stations in the XuanJiaWan District of Zhunger County. The two companies, with total assets in excess of US$45 million and over 500 employees, are located in Inner Mongolia, a rapidly modernizing autonomous region of the People’s Republic of China.

To learn more about China Energy Corporation, visit www.chinaenergycorporation.com