updated 3/30/2011 9:16:59 AM ET 2011-03-30T13:16:59

NEW YORK, March 30, 2011 (GLOBE NEWSWIRE) -- China Bio-Energy Corp. (OTCBB:CHIOD) ("China Bio-Energy" or the "Company"), primarily engaged in the production, refinement and distribution of biodiesel fuels in China, today reported good news in regards to both the Company's progress and developments in the biodiesel market.

China Bio-Energy believes it is poised to capture an increasing share of China's growing biodiesel market. In September 2007, then Vice Chairman of the National Development and Reform Commission of the People's Republic of China, Chen Deming, stated that China aims to consume 2 million metric tons of biodiesel annually by 2020. Additionally, in December 2010, the Ministry of Finance of the People's Republic of China (PRC) and the State Administration of Taxation of the PRC announced an elimination of the consumption tax on vegetable oil and animal fat-based biodiesel. This tax exemption retroactively applies to any purchases made after January 1, 2009 and the Chinese Government will issue refunds for taxes already paid. According to the Finance Ministry, the goals of the initiative are, "boosting the renewable resources sector, easing demand for petroleum and protecting the ecological environment." Chinese biodiesel companies, like China-Bio Energy, stand to benefit considerably from the Chinese government's support.

China Bio-Energy's competitive advantage lies in part in the Company's special refining technique (patent pending) that can process multiple types of raw materials—including refined animal fats and both crude and refined vegetable oils—to produce their biodiesel. Refining multiple raw materials through a single process allows China Bio-Energy to reduce operational costs and maintain access to multiple supply sources from which the Company can select the most productive and cost-efficient raw material.

Sanfu Huang, the Chief Executive Officer of China Bio-Energy, stated, "Since most biodiesel raw material is indirectly derived from edible crops, prices are highly volatile, and their use for fuel production is at times a divisive political issue. The Chinese government has triggered a series of policy shifts in the industrial use of grain and this has resulted in intense pressure for biodiesel companies to find alternative raw materials. Due to the resulting bottleneck of raw materials for biodiesel, many small or less efficient producers have been driven out of business. It is vital for companies in this industry to have access to long-term raw material supplies, preferably by owning supply sources. China Bio Energy significantly improved its position in the marketplace and reduced its risk by diversifying its sources of raw materials via long-term contracts with suppliers and a steady internal supply of oils from our Sapindus plantation."

In an effort to position itself for long-term success, the Company made a strategic decision to obtain its own supply source. China Bio-Energy acquired the land use rights of an approximately 165 acre Sapindus tree plantation located in Zhejiang Province in 2010. The core of the Sapindus tree can be used as a raw material for producing biodiesel. China Bio-Energy considers the seeds of its 50,000 Sapindus "mother trees" found on the plantation to be the best Sapindus seeds available. The Company expects to use the plantation as the foundation for its intended expansion to an approximately 165,000 acre Sapindus forest in the next 3-5 years, which, if successful, is expected to provide one-third of the total raw materials required for its biodiesel production beginning in 2013.

China Bio-Energy believes it is the only biodiesel producer in China that uses Sapindus as a raw material base to refine its fuel. China Bio-Energy believes its investment in the Sapindus plantation and the research it will be conducting on Sapindus tree breeding techniques constitute considerable barriers to use of Sapindus by any competitor.

In regard to ethanol as a biofuel competitor of biodiesel, Mr. Huang commented, "Since the Chinese Government has placed a high priority on independence in food supply, and ethanol competes with food supply for raw materials, the expansion of ethanol plants has been restricted. Biodiesel, however, has more raw material options that do not compete with the food supply and is often made from food refuse. Based on those characteristics, we believe biodiesel is expected to enjoy a larger market share in the Chinese biofuel market in the near future. We at China Bio-Energy anticipate that we will soon become an eminent name in China's biodiesel market. We look forward to being one of China's primary providers of biodiesel for years to come."

About China Bio-Energy Corp.

China Bio-Energy is engaged in the production, refinement and distribution of biodiesel fuel. The Company employs 81 full-time employees. China Bio-Energy is incorporated in Delaware and has its headquarters in Zhangzhou, Fujian Province, China, where it operates a biodiesel manufacturing facility capable of producing approximately 40,000 tons of biodiesel fuel annually. The raw materials used in China Bio-Energy Corp.'s production of biodiesel are refined animal fats and crude and refined vegetable oils. The Company has developed [patented and patent pending] technology relating to the production of biodiesel fuel which enables it to utilize a variety of different raw materials, giving China Bio-Energy more flexibility in selecting raw materials based on productivity, availability and price. China Bio-Energy's products are currently sold primarily to various oil companies located in Fujian Province, China.

Safe Harbor Statement

As a cautionary note to investors, certain matters discussed in this press release may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions. Such forward-looking statements involve known and unknown risks and uncertainties that may cause actual results to be materially different from those described herein as anticipated, believed, estimated or expected, including the following: changes in economic conditions; general competitive factors; acceptance of the Company's products in the market; the Company's success in technology and product development; the Company's ability to execute its business model and strategic plans; and all the risks and related information described from time to time in the Company's SEC filings, including the financial statements and related information contained in the Company's SEC filings. China Bio-Energy assumes no obligation to update the information in this release.

CONTACT: Investor Contact:
         Mr. Kevin Fickle
         NUWA Group, LLC
         Tel: +1-925-330-8315
         Email: Kevin@nuwagroup.com
         
         
         Company Contact:
         Ms. Jingmei Weng
         China Bio-Energy Corp.
         Tel: +1-646-512-5861
         Email: ir@chinabio-energy.com

© Copyright 2012, GlobeNewswire, Inc. All Rights Reserved

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