BEIJING, Jan. 10, 2011 (GLOBE NEWSWIRE) -- SinoTech Energy Limited (Nasdaq:CTE) ("SinoTech" or "the Company"), a fast-growing provider of enhanced oil recovery ("EOR") services in China, today announced that it has signed agreements to extend its existing patented molecular deposition film ("MDF") oil recovery services in the Dagang and Liaohe oilfields in northern China, and has sealed a new agreement to provide MDF services at a new oil block in the Liaohe oilfield.
SinoTech is the exclusive provider of MDF services in China and holds a PRC patent for MDF technology. MDF increases oil recovery from mature oil wells by displacing the residual oil that adheres to sedimentary rock or sand in oil reservoirs. When the MDF chemical solution comes into contact with the oily sand or rock it creates an ultra-thin film that separates the oil from the sand or rock, thereby enabling the oil to flow more freely and to be more efficiently extracted.
Under the terms of the agreements announced today, SinoTech will continue to provide MDF services through a subcontractor to oil producers in the Dagang oilfield for a one-year period ending December 31, 2011, and will continue to provide MDF services through a subcontractor to oil producers in the Liaohe oilfield for a two-year period ending December 31, 2012. The Company has also signed a two-year agreement which will run to December 31, 2012 to provide MDF services through a subcontractor at a new oil block in the Liaohe oilfield.
"We are very pleased to continue providing our MDF services to existing customers and to expand our service coverage to new areas. These service agreements demonstrate the strong confidence that China's oil producers have in our MDF technology," said Mr. Guoqiang Xin, CEO of SinoTech.
"Enhancing output from mature oil wells is an important focus for China's government and oil producers, as the country aims to improve its energy independence despite having a finite amount of natural resources. Our MDF solutions are reliable, cost-effective and high-performing, and we look forward to providing this service to more clients in the future as demand for MDF grows further."
MDF is one of SinoTech's two core EOR services. Its other core service, lateral hydraulic drilling ("LHD"), is a method of increasing the output of oil and coalbed methane from mature wells by using high-pressure water jets to drill horizontal tunnels in multiple directions from the vertical wellbore. SinoTech holds the exclusive rights to use LHD technology and equipment in China, and recently announced plans to double the size of its LHD fleet by the end of 2011.
About SinoTech Energy Limited
SinoTech Energy Limited is a fast-growing provider of enhanced oil recovery ("EOR") services in China. SinoTech provides innovative EOR services to major oil companies in China using leading edge technologies, including certain patented lateral hydraulic drilling ("LHD") technologies, which the company has an exclusive right to use in China, and a molecular deposition film ("MDF") technology, for which the company holds a PRC patent. SinoTech also provides technical services to coalbed methane customers using LHD technology.
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Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact in this press release are forward-looking statements, including but not limited to, SinoTech's goals and strategies, its future business development, growth of its operations, financial condition and results of operations, its ability to introduce successful new services and attract new clients, growth of the EOR services market in China and worldwide, its beliefs regarding its strengths and strategies, changes in the oil services industry in China, including changes in the policies and regulations of the PRC government governing the oil services industry, its access to current or future financing arrangements, and fluctuations in general economic and business conditions in China, and other risks and uncertainties disclosed in SinoTech's filings with the Securities and Exchange Commission. These forward-looking statements involve known and unknown risks and uncertainties and are based on information available to SinoTech's management as of the date hereof and on its current expectations, assumptions, estimates and projections about SinoTech and the oil and gas industry. Actual results may differ materially from the anticipated results because of such and other risks and uncertainties. SinoTech undertakes no obligation to update forward-looking statements to reflect subsequent events or circumstances, or changes in its expectations, assumptions, estimates and projections except as may be required by law.
Source: SinoTech Energy Limited
CONTACT: Investor and media inquiries: Ms. Rebecca Guo SinoTech Energy Limited, Beijing + 86-10-8712-5567 rebecca.guo@sinotechenergy.com Brunswick Group LLP Ms. Yue Yu +86-10-6566-2256 sinotech@brunswickgroup.com