Daqing FRP Pipes Facility  |  Daqing Wind Power Facility  |  Beijing Facility
Tianjin Facility  |  Aktobe, Kazakhstan Facility


Daqing FRP Pipes Facility

The Company currently has annual production capacity of 3,200 km of pipes for the oil industry. The Company's principal facility is Harvest's manufacturing plant located in Daqing, a city in northeast China which is home to 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. The Company is completing construction on a new FRG pipe facility in Tianjin, China. As of February 29, 2008, the Company had 990 employees.

To increase capacity at its Daqing FRP pipes facility, the Company has recently built four new FRP pipe production lines at a capital cost of RMB 10 million (C$1.4 million), which was funded by cash on hand. The new lines are now fully operational. With the additional production lines, the Company now has 14 production lines and total pipe production capacity of approximately 3,200 km per annum, an increase of 60% compared with the end of 2006. The new production lines were built using the Company's proprietary technology and are expected to have reduced production costs due to reduced usage of raw materials and improved energy efficiency. The Company designs and assembles its own production and testing equipment, but employs contractors and vendors for fabrication and parts.


Daqing Wind Power Facility

Hanwei intends to manufacture and assemble the wind power equipment in a manufacturing facility located near its FRP pipe plant in Daqing. Hanwei has been granted the right to use this manufacturing facility by Ruihao on a rent-free basis until June 30, 2008, with an option to renew on terms to be negotiated. This facility is leased by Ruihao from the Sa Er Tu District Government in Daqing City, Heilongjiang Province, pursuant to which Ruihao pays rent and the government reimburses Ruihao based on certain criteria. Hanwei has allocated approximately C$3 million for capital expenditures to fund the moulds, assembly cranes and other equipment required to manufacture and assemble wind power products. Hanwei will fund the working capital requirements with cash raised from its recent Special Warrant Offering.


Beijing Facility

In the first quarter of 2007, the Company commenced commercial production of spray headers for FGD pollution control systems for the coal power industry in China at a temporary production facility in Beijing. The Company plans to move its FRP spray header production lines to its Tianjin plant and intends to close its temporary Beijing production facility once such move is complete.


Tianjin Facility (Under Construction)

Hanwei is currently constructing a 276,633 square feet facility in the coastal city of Tianjin, located 120km east of Beijing. Tianjin hosts the largest port in northeast China. Once completed, the facility will house its coal operations and could potentially be used for FRP pipe or wind equipment production as well. The facility is expected to be completed in the second half of 2008.


Aktobe, Kazakhstan Facility

Hanwei plans to construct a 1600 kilometer per year FRP oil pipe facility in Aktobe, Kazakhstan to service this growing market. The Company has received a business licence, leased a site and has begun the site planning and approval process, The facility is expected to be operational in the second half of 2009.