SOURCE: ECO2 Forests Inc.

ECO2 Forests Inc.

February 16, 2010 07:00 ET

ECO2 Forests Expands Kiri Tree Variants -- Planting in US Expected in Q3 2010

SACRAMENTO, CA--(Marketwire - February 16, 2010) - ECO2 Forests Inc. (PINKSHEETS: ECOF) is pleased to announce that it has expanded tree production stock to six (6) variants of the Kiri Tree and expects planting to begin on US soil in Q3 2010.

The Kiri Tree is the selected primary species for the ECO2 Forests Global Forestry Plan that addresses deforestation, increasing atmospheric carbon dioxide levels and the increasing demand for sustainable lumber by developing large scale reforestation projects with a positive environmental and economic impact.

The development, use and know how in creating and selecting specific Kiri Trees for each project is central to the successful implementation of the ECO2 Forests Global Forestry Plan projects around the world, including planned projects under negotiation in the United States of America and the recently announced Malakula Reforestation Project in the South Pacific.

"Ongoing research and development of four new Kiri Tree variants at the company's Research and Development Centre in Queensland, Australia, is intended to ensure the company maintains a forefront position in international renewable forests and carbon sequestration," said Martin Tindall, ECO2 President.

Two Kiri sub species, Fortunei and Elongata, have been mass planted already and are complemented by four variants currently being planted and tested for future projects. These four additional species; Taiwaniana, Australis, Fagesii and Kawakamii may expand the options and viability of ECO2 Forests Global Forestry Plan projects in greater geographic and climatic conditions.

"Each project has its own unique climatic and soil conditions. What will be required here in the US later this year in the third quarter will be different to projects in Australia or the South Pacific," ECO2 Forests Chief Executive Officer Collie Christensen said.

"Using linear selection from derivatives of the species we are able to grow the Kiri Tree variant best suited to those conditions and project. The high quality end product lumber is virtually indistinguishable between variants but the ability to select the ideal variant ensures the tree maximises its carbon sequestration and growth rate. Matching variants to local conditions also aids the longevity of the project over multiple growth and harvest cycles," added Christensen.

The Kiri Tree's superior ability to sequester carbon dioxide (CO2) from the atmosphere positions ECO2 Forests to generate carbon credits rapidly and achieve a positive environmental outcome in a much shorter time frame than other tree species. Over a harvest period of seven years, historic research shows that a single Kiri Tree would typically sequester up to 2.5 tons of CO2 thereby generating up to 2.5 carbon credits for ECO2 Forests. This level of carbon sequestration potentially places the Kiri Tree among the highest sequestering trees currently being grown around the world.

Further to the CO2 sequestering abilities of ECO2's Kiri Trees, is its ability to grow 20 feet (6 meters) in its first season and a height of 80 feet (25m) and diameter of 20-inches (50 centimeters) in as little as seven years. The natural fast growth capability of the Kiri Tree is aided by the linear selection techniques and the employment of ECO2 planting and growing methodologies under the Global Forestry Plan. The combination of all this makes the Kiri Tree, after seven years, ready for harvest; a fraction of the time compared to many of its competitors.

Lumber from the seven year sustainable harvest cycle contains minimal defects and is used across a wide range of industries; from fine furniture manufacturers, interior decorations and trimming, courtesy of its natural beauty and workability through to the boating industry for framing due to the high strength to weight ratio.

Lumber quantity, through the fast growth and high density planting methodologies, from one thousand acres of Kiri Tree grown under the Global Forestry Plan is projected to yield over 40 million board feet of lumber (95,000m3) every seven year sustainable harvest. Current lumber prices for Kiri range from USD$2.00 to $4.00 per board foot, depending on quality.

Approximately 3 million trees are intended to be planted over a seven year cycle in the planned Malakula Reforestation Project. ECO2 projects that under the sustainable Global Forestry Plan that the Kiri Tree may yield 100 million board feet (237,000m3) annually after just seven years, with annual revenue forecast in excess of US $260 million.

A natural ability of the Kiri Tree to regenerate from the stump after harvest provides the final and sustainable factor in determining the Kiri Tree as the ideal species for the Global Forestry Plan. Post harvest, the Kiri Tree grows a new stem from the stump which, in another seven years, will again be ready for harvest and generate up to 2.5 carbon credits for ECO2 Forests. This regenerative cycle allows the Global Forestry Plan to yield up to 10 cycles from a single plantation before the need for replanting.

Sustainability is central to the economic and environmental appeal of the Kiri Tree's use within the Global Forestry Plan.

About ECO2 Forests Inc.
ECO2 Forests is a progressive international forestation company focused on reforestation of previously damaged and deforested land and the saving of existing threatened forests through sustainable reforestation, afforestation and avoided deforestation projects for the generation and sale of carbon credits and sustainable timber to global markets.

ECO2 Forests has the ability to remove significant amounts of CO2 from the atmosphere through projects operated under the Global Forestry Plan and use of the unique and sustainable Kiri Tree, a high CO2 sequestering tree that generates carbon credits. ECO2 Forests produces revenue by selling those carbon credits to a third party or through a carbon market. Additional revenue is created through the sale of the sustainable lumber from the Kiri Tree every 7-year harvest. The Kiri Tree then naturally re-grows after each harvest.

Headquartered in Sacramento, California, the Company has adopted an 'E4 Philosophy' to achieve positive Environmental, Economic, Employment and Educational outcomes through its reforestation projects.

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