updated 11/22/2010 7:15:44 AM ET 2010-11-22T12:15:44

ZIBO CITY, China, Nov. 22, 2010 (GLOBE NEWSWIRE) -- China Chemical Corp. (OTCQB:CHCC) ("China Chemical" or the "Company"), a manufacturer of organic chemicals for broad consumer goods applications, announced today that it has completed construction on the expansion of its Maleic Anhydride ("MAH") production facility and has begun site development on its planned and permitted 50,000–ton-capacity 1,4-Butanediol ("BDO") production facility.

The completed expansion doubles China Chemical's MAH total production capacity to 60,000 tons. The new 30,000-ton MAH plant is now in its testing phase, which includes the debugging of the facility's operations. The Company expects to complete this testing period by December 31st, 2010.

China Chemical also announced that site development work has begun for the construction of its 50,000-ton BDO cogeneration facility. BDO utilizes MAH as a feedstock and is used in a wide variety of commercial applications. The plant is scheduled for completion in 2012.

China is the world's largest consumer of MAH and BDO and accounts for 23% of global demand for the two chemicals. According to market research firm ResearchInChina, the BDO production capacity of mainland China grew 96.5% year-over-year in 2009 in response to strong domestic demand.

Mr. Lu Feng, Chairman and CEO of China Chemical, stated, "These two projects form the core of our expansion strategy over the next five years and will enable us to continually meet the vast demand from China's manufacturing sector for organic industrial chemicals."

Chairman Lu continued, "The BDO cogeneration facility will boost our competitive advantage by diversifying our product lines. The gross margin of BDO is expected to be more than double that of MAH, currently our most profitable product. We believe that our ability to produce BDO and its feedstock in-house will result in increased sales and greater profitability for the Company. BDO is in high demand among China's fastest-growing consumer goods industries, and we expect to sell our maximum plant production capacity year-round."

About China Chemical Corp.

China Chemical Corp. is a Zibo City, China-based manufacturer of organic chemical compounds used in high-performance plastics, PVC, elastic fibers, paints, tires, insulation, flooring, adhesives, medicines, food processing, ink, and paper. The Company's primary products are Phthalic Anhydride (PA) and Maleic Anhydride (MAH), which are used in a wide variety of applications in the construction, automotive, aviation, marine, and consumer goods industries. China Chemical currently has the total capacity to produce 50,000 tons of PA and 60,000 tons of MAH annually.

For more information about China Chemical Corp., please visit the Company's website at http://www.chinachemicalcorp.com .

Forward-Looking Statements

Certain statements contained herein constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations, estimates and projections about the Company's industry, management's beliefs and certain assumptions made by management. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Because such statements involve risks and uncertainties, the actual results and performance of the Company may differ materially from the results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, product demand, market competition, and risks inherent in our operations. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Unless otherwise required by law, the Company also disclaims any obligation to update its view of any such risks or uncertainties or to announce publicly the result of any revisions to the forward-looking statements made here. For additional information, readers should carefully review reports or documents the Company files periodically with the Securities and Exchange Commission.

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