Hanwei Energy Services Corp.

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Fact Sheet
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Recent Press Releases

August 14, 2008
Hanwei Announces Financial Results for the Second Quarter and First Half of 2008

August 14, 2008
Hanwei Executes Binding Agreements to Complete Deta Acquisition

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An opportunity to invest in the growth of China’s energy sector through a TSX listed Company

Strong track record of success in China and Canadian Capital Markets
World’s second largest and fastest growing energy market
First mover advantage in FRP for the Oil and Wind sectors in China
World class joint venture partners
Growth opportunities in the Oil and Gas, Wind, and Coal sectors

Entered the wind power business in 2007 with an initial order to supply approximately $27.9 million worth of wind power equipment to Daqing Deta Electric Co. (Deta), the primary equipment manufacturer for Daqing Ruihao Technology Co. Ltd. (Ruihao), a China-based wind farm developer; part of three-year agreement that included $239 million of intended orders
Subsequent to the end of the year, announced the proposed $86 million acquisition of Deta, which includes a 5-year, 1200 megawatt equipment contract with Ruihao valued at approximately $1.2 billion, replacing the $239million in intended orders from the previous contract
Entered the coal power market in 2007 through the application of the Company’s expertise in FRP (fiberglass reinforced plastic) to produce spray headers for FGD (flu gas desulphurization) systems in coal fired power plants
Enhanced its coal business through a proposed joint venture with Ershigs Inc., a leading US based manufacturer of FRP duct and chimney liners for FGD systems, expanding Hanwei’s product offering to the coal power industry
Grew sales in the FRP pipe manufacturing business by 30% and doubled production capacity
Graduated from the TSX Venture to the TSX in September 2007
Raised approximately $77.25 million of new equity in 2007 to support its growth strategy

About Hanwei Energy

High Pressure FRP Pipe | Coal Power | Wind Power

Hanwei Energy Services Corp. is a leading provider of value added products and services for the global energy sector.

The Company owns a 91.075% equity interest in Daqing Harvest Longwall High Pressure Pipe Co. Ltd. ("Harvest"), one of China's largest manufacturers of FRP pipes for the oil and gas sector. The remaining 8.925% equity interest in Harvest is owned by the Company's joint venture partner, Changyuan Investment Co. Ltd., an indirect subsidiary of China National Petroleum Corp. (CNCP), a China state-owned entity. CNCP is the parent company of PetroChina Co., Ltd., a major Chinese oil and gas company listed on the New York Stock Exchange, which is also the largest customer of Harvest.

Hanwei has established itself as one of the largest manufacturers of high pressure FRP pipes in China.The Company has increased production capacity, sales and net income every year since 2003. For the year ended December 31, 2007, Hanwei increased revenue by 71% to C$40.8 million and net income by 37% to C$6.3 million. Substantially all of Hanwei's revenues, from inception to March 31, 2006, were generated from sales of FRP pipe to the oil industry in China. In 2007, Hanwei successfully diversified its revenue base by entering the wind power and clean coal sectors. These two sectors accounted for approximately 24% of the Company’s 2007 revenue.

The Company currently has annual production capacity of 3,200 km of FRP pipe for the oil industry. The Company's principal facility is Harvest's manufacturing plant located in Daqing, a city in northeast China, which is adjacent to the Daqing oil field, the largest producing oil field in China. The Company also has a temporary manufacturing facility located in Beijing, the capital of China, for the production of pollution control products for the coal industry. The Company's wind power operations are housed in a manufacturing facility located near its Daqing plant. As of February 29, 2008, the Company had 990 employees.

High Pressure FRP Pipe for the Oil Industry

Hanwei has increased production capacity at its Daqing high pressure FRP oil pipe plant to 3,200 km per annum, representing a 100% increase over production and sales of approximately 1,600 km in 2006 and a 60% increase over production capacity of 2,000 km as of the beginning of 2007.

In March 2007, the Company announced that it had signed an Exclusive Cooperation Agreement (the "ECA") with China Petroleum Technology and Development Corporation (CPTDC), a wholly owned subsidiary of China National Petroleum Corp. ("CNPC"), a state-owned entity and the parent company of Daqing Oil Management Bureau which owns Daqing Changyuan Investment Co. Ltd. (Hanwei's joint venture partner) and PetroChina Co., Ltd. a major Chinese oil and gas company listed on the New York Stock Exchange (NYSE: PTR). Under the ECA, Harvest and CPTDC agreed to cooperate to develop markets for Hanwei's FRP products in Kazakhstan and other Commonwealth of Independent States (including: Azerbaijan, Armenia, Belarus, Georgia, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Uzbekistan and Ukraine); as well as Indonesia, India, Saudi Arabia, Oman, and Peru for an initial period of two years. The ECA is a mutually exclusive agreement for the designated countries such that Hanwei cannot sell through any other distributor and CPTDC cannot sell FRP products from any other supplier (unless Hanwei does not offer a similar product).

In 2007, Hanwei commenced sales and marketing with CPTDC in Kazakhstan and generated sales of approximately RMB 13.3 million (C$1.9 million). Over the past year, Hanwei has conducted market analysis and established a working relationship with CPTDC in Kazakhstan. According to EIA, Kazakhstan produced approximately 1.45 million barrels per day in 2007 and is expected to grow its production by over 9% annually for 2008 and 2009, and the Kazakh government hopes to increase production levels to around 3.5 million bbl/d in 2015. The Company believes that there is a significant need for FRP oil pipe in Kazakhstan to solve corrosion problems and that there is limited competition. Hanwei has established subsidiaries in Kazakhstan with the goal of increasing sales and marketing activity and plans to build a 1600 kilometer per annum high pressure FRP oil pipe production plant in Kazakhstan in order to reduce transportation costs, address barriers to entry into the Kazakh market and build market share. The facility will be located in Aktobe, Kazakhstan and is expected to completed in late 2009.

Coal Power Industry

Hanwei commenced commercial operations of FRP spray headers for wet flue gas desulphurization ("FGD") pollution control systems in early 2007. Coal fired plants generated over 50% of the 26 million tonnes of sulphur dioxide (SO2) emitted in China in 2005. The Chinese government has implemented pollution control policies that require all new coal fired plants and a large percentage of existing coal fired plants install SO2 pollution control systems. According to State Electricity Regulatory Commission (SERC), China electricity installed generating capacity grows 14.4% to 713 GW by the end of 2007, over 75 percent of which are coal fired. Total coal-fired generator installed capacity increase 14.6% to 554 GW. In 2007, China made a significant progress in the installation of FGD system. Coal-fired generators installed with FGD systems account for 48.7% of total installed capacity, adding up to 270 GW. Newly installed coal-fired generators with unit capacity of 100 MW and over add together 110 GW, which have FGD system in the first place.

FRP is a cost effective material used in FGD system to protect pipes, ducts and chimneys from corrosive flue gas. In the first quarter of 2007, Hanwei established two spray header production lines at a temporary production facility in Beijing. Hanwei plans to move its FRP spray header production lines to a proposed Tianjin plant and intends to close its temporary Beijing production facility once such move is complete in the third quarter of 2008. In 2007, Hanwei successfully bid on eight contracts for total value of approximately $2 million of spray headers and accessories and generated $1.4 million in sales revenues. Spray headers comprise about 10% of the potential purchase of FRP products for FGD systems. Hanwei plans to develop or acquire technology to produce a full set of FRP products for FGD systems.

On November 27, 2007, the Company entered into a Memorandum of Understanding with Ershigs Inc. ("Ershigs"), a leading U.S. based manufacturer and installer of FRP products, to establish a 50:50 joint venture (the "China JV") to expand the Company’s product offering for the pollution control business. New products that the China JV is planning to offer include, but not limited to, FRP duct and FRP chimney liners. The addition of new products will position the Hanwei as one of the few companies that can supply FRP ducts and FRP chimney liners in the Chinese market and will significantly increase average sales per customer. The China JV is expected to begin operations in the second half of 2008.

Wind Power Industry

According to the Global Wind Energy Council, or GWEC, a wind power industry association, the global market for wind power equipment was approximately US$29 billion in 2007 due to a 27% increase in global wind power capacity to 94 GW and China’s wind power capacity grew by 3,449 MW, or 156% to over 6,000 MW and now ranks fifth in installed wind energy capacity with over 6,000 MW at the end of 2007. According to China’s Renewable Energy Development Medium and Long-term Plan, China total installed capacity of wind power generators is planned to reach 5 GW by 2010 and 40 GW by 2020. Recently promulgated Renewable Energy Development Eleven-Fifth Plan increases 5 GW to 10 GW by 2010.Inner Mongolia, including the Durbert Mongolia Autonomous County, where the equipment Hanwei is producing will be installed, is forecasted to host 10,000 MW of China's wind capacity by 2020.

Hanwei has an agreement with Daqing Deta Electric Co. Ltd., (a private PRC company) (Deta) to manufacture approximately RMB 200 million (C$28.1 million) worth of wind power products, including turbines, blades and towers, and an expression of intent for the placing of additional orders with Hanwei for wind power products in the amount of RMB 600 million (C$84.4 million) in 2008 and RMB 900 million (C$126.6 million) in 2009, subject to satisfactory completion by Hanwei of the 2007 order.

In a press release dated January 24, 2008, Hanwei announced that it had entered into a Memorandum of Understanding ("MOU") to acquire 100 percent of Deta for RMB 600 million ($85.3 million). As announced in a subsequent press release on May 13, 2008 Hanwei entered into a revised MOU (the "Revised MOU"), pursuant to which Hanwei Wind Power Equipment (Daqing) Co., Ltd. ("Hanwei Wind"), a wholly owned subsidiary of Hanwei, will acquire 99 percent of Deta, for RMB 591 million ($86.2 million), of which RMB 431 million ($62.8 million) will be paid under an earn out provision from 2008 to 2012 based on the performance of Deta. The earn out provision will be paid with RMB 300 million ($42.7 million) in Hanwei common shares (8,051,746 Hanwei common shares valued at $5.30 per share, based on the Bank of Canada exchange rate of 7.03 as of January 18, 2008) and RMB 131 million in cash. Hanwei Wind will have an option, to acquire the remaining 1 percent of Deta for RMB 6 million ($0.88 million) at any time, and the shareholders of Deta will have an option to require Hanwei Wind to purchase the remaining 1 percent of Deta for RMB 6 million ($0.88 million), twelve months after the close of the acquisition, subject to the approval of the Chinese government. Under the Revised MOU, signed by Hanwei, Deta and Heilongjiang Ruihao Energy Technology Co., Ltd. ("Ruihao") (the end-user of the wind power equipment), Deta will enter into a contract with Ruihao to provide 1,200 MW of wind power turbines, blades and towers valued at approximately RMB 8.4 billion ($1.2 billion). The parties will enter into a 200 MW manufacturing contract in 2008 and will thereafter negotiate an annual manufacturing contract for 250 MW of wind power equipment during the period of 2009 to 2012. Deta will also have a right of first refusal to provide all future wind power equipment for wind farms that Ruihao owns or controls. The contract associated with the acquisition of Deta replaces expressions of interests contemplated in the original contract with Deta.

To further support its wind equipment production capabilities, Hanwei entered into a licensing agreement with Aerodyn Energiesysteme GmbH ("Aerodyn") granting Hanwei the non-exclusive right to produce two versions of Aerodyn’s aeroBlade 1.5 in China. The Agreement provides Hanwei with the moulds, technical know-how, specifications, and support to produce the 37.5 metre and 40.3 metre versions of the 1.5-megawatt blades and market them in China under the Hanwei brand. The first mould and related equipment is scheduled for delivery in May, with additional moulds expected to be delivered over the next six months.

In January 2008, Hanwei delivered four 1.5 MW turbines to Daqing Deta Electric Co. Ltd ("Deta") under its wind power contract with Deta and Ruihao. Two of these turbines have been installed in Ruihao’s wind farm in Heilongjiang Province, China.