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A-Power Energy Generation Systems, Ltd.-Led Shenyang Power Group Signs MOU with Macau Natural Gas Co., Ltd. to Develop an Offshore LNG Project

Posted on: Friday, 10 July 2009, 08:24 CDT

SHENYANG, China, July 10 /PRNewswire-Asia-FirstCall/ -- A-Power Energy Generation Systems, Ltd. (Nasdaq: APWR) ("A-Power" or "the Company"), a leading provider of distributed power generation ("DG") systems in China and a fast-growing manufacturer of wind turbines, today announced that Shenyang Power Group Co., Ltd. ("Shenyang Power"), A-Power's majority-owned local DG industry alliance, has signed a Memorandum of Understanding (MOU) with Macau Natural Gas Co., Ltd. ("MNG") to construct an offshore liquefied natural gas ("LNG") complex to import, store and re-gasify LNG and to distribute natural gas to Macau and elsewhere.

Pursuant to the MOU, a project company will be set up to undertake the construction of the LNG terminals. An artificial island to be formed by land reclamation adjacent to Macau will be the site for the project, which involves a 49-foot water-depth shipment depot, the LNG receiving and re-gasification terminals, storage facilities and associated pipelines and facilities. The project will be an expansion of MNG's existing natural gas facilities and the total cost of the project is currently estimated to be $1.5 billion, according to the MOU.

Also pursuant to the MOU, after the construction of the LNG terminals, which is expected to take approximately 24 months, a 2,400MW natural gas power plant will be built at the same location. The details of the power plant are pending until further negotiation among the parties.

Lastly, pursuant to the MOU, subject to the finalization of the plan, the capacity of the LNG facilities is expected to be 3 million tons per year starting 2013 and 5 million tons per year in 2015.

The MOU is legally binding but may be terminated by mutual consent of all the parties.

"A-Power as the majority-owner of Shenyang Power is very pleased to be a participant in such a major clean energy project in Southern China," said Mr. Jinxiang Lu, A-Power's Chairman and CEO. "This offshore LNG complex has received avowed support from the government including the City of Shenyang and the Macau Special Administrative Region at the local level, as well as the National Development and Reform Commission in Beijing. Along with other members in the Shenyang Power alliance, we are excited to contribute our engineering expertise in cleantech to this very large-scale, and logistically complex project. With the government backing, we are hopeful that the final terms of the contract will be set out later this year and the construction phase could start sometime next year."

About A-Power

A-Power Energy Generation Systems, Ltd. ("A-Power"), through its China-based operating subsidiaries, is the largest provider of distributed power generation systems in China, focusing on energy-efficient and environmentally friendly projects of 25MW to 400MW. In 2008, A-Power entered the wind energy market and has built China's largest wind turbine manufacturing facility, located in Shenyang, Liaoning Province, with technologies licensed from German FUHRLANDER AG and Denmark-based Norwin, and a total annual production capacity of 1,125MW. In March 2009, A-Power entered into an agreement to establish a Joint Venture partnership with GE Drivetrain Technologies to produce wind turbine gearboxes in Shenyang. A-Power also has strategic relationships with Tsinghua University in Beijing and the China Academy of Sciences in Guangzhou to develop and commercialize other renewable energy technologies. For more information, please visit http://www.apowerenergy.com .

Safe Harbor Statement

This press release may contain forward-looking statements. Any such statement is made within the 'safe harbor' provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," and other similar statements. Statements that are not historical facts, including statements relating to anticipated future earnings, margins, and other operating results, future growth, construction plans and anticipated capacities, production schedules and entry into expanded markets are forward-looking statements. Such forward-looking statements, based upon the current beliefs and expectations of our management, are subject to risks and uncertainties, which could cause actual results to differ materially from the forward-looking statements, including but not limited to, the risks that: Our expansion of our business outside of China will subject us to risks inherent in conducting business internationally and may not be successful; increases in the price of raw materials and labor may increase our cost of sales and reduce our earnings; we may experience construction and development delays on our projects which could adversely affect our financial condition and operating results; if we do not manage our growth successfully, our growth and opportunity to maintain and increase profitability may be hindered or impeded, as well as other relevant risks detailed in our filings with the Securities and Exchange Commission, including those set forth in our annual report filed on Form 20-F for the fiscal year ended December 31, 2008. The information set forth herein should be read in light of such risks. We assume no obligation to update the information contained in this press release, except as required under applicable law.

SOURCE A-Power Energy Generation Systems, Ltd.

Source: PR Newswire

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