Tiger Ethanol International Inc.
OTC Bulletin Board : TGEI

Tiger Ethanol International Inc.

January 23, 2007 17:00 ET

Tiger Ethanol Chosen by Xinjiang Province for its First Ethanol Plant in Hami

MONTREAL, QUEBEC--(CCNMatthews - Jan. 23, 2007) - Tiger Ethanol International TGEI (OTCBB:TGEI) is proud to report that it will benefit greatly from the choice of Hami, Xinjiang Province in far western China for its first ethanol plant. The Hami site has obtained full support from all levels of government. The site has an abundant supply of raw materials and also has available an extensive area of high quality farmland for future expansion of the agricultural raw materials resource base. The availability of skilled manpower for running and servicing the plant is also an asset of the Hami site.

It is also important to emphasize that the site choice resulted in Tiger's success in forming a joint venture with local partners experienced and familiar with both the industry and the region. Mr. Lou Qi Shou, a 5% joint venture partner operates a successful distillation plant producing potable alcohol in Hami. Mr. Lou held various management positions with local producers, since 1999 is chairman of the Xinjiang Wang Yi Brewing Company in Hami. Mr. Lou's experience and expertise will bring significant value to the plant's planning and construction phases. He will also serve as a consultant to the joint venture after start-up and normal operation of the plant. Mr. Qiu Zhiming, another 5% partner, an engineer, since 1998 a shareholder and executive of the Guangzhou China Triumphant Investment Company, operating in real estate development on a national scale.

The company has received all necessary operating licenses and permits to build and operate an ethanol plant and Xinjiang Province has granted the Venture a long term Deed of Use for 150 acres of industrial land to be used as the site of Tiger's ethanol plant. In further support of Tiger's Venture, the plant site will be furnished to the Venture with all necessary services in place including roads, electricity, water, communications and railroad sidings.

In summary, through various agreements the Company has obtained a logistically efficient manufacturing site and availability of raw material in the Province of Xinjiang, far removed from the established fuel ethanol production base in Eastern China.

The Tiger's Joint Venture (Xinjiang Yajia Distillery Co. Ltd.) has received an official commitment from the Hami District as the following extract shows:

Hami District Development Planning Commission official letter translation:

"Approval to the submission concerning the Project of Xinjiang Yajia Distillery Co. Ltd., the said Project is in accordance with stipulations of China's related laws, regulations and both "Catalogue for the Guidance of Foreign Investment Industries & "Advantageous Industries for Foreign Investment" in the central and western regions Catalogue. Through examination the Commission hereby approved as follows:

I. Dimension and detail: Annual yield of 20 thousand ton of ethanol and, as byproduct,18.5 thousand ton of albumen fodder, 18.5 thousand ton of carbon dioxide and 20 thousand ton of condensable dried fodder stuff (DDGS)."

Official seal and Date: 2006-06-07


Xinjiang province has implemented broad policies to attract foreign investment to develop its central and western regions in accordance with China's national policies. According to the policy, the staff at the Provincial planning department were directly influenced by negotiations regarding China's accession to the World Trade Organization and the measures to be adopted by the government of the region after China's entry into the WTO. As a result, the Provincial Development Policies have been designed in a manner that should provide a comparatively stable business environment for ventures such as Tiger.

Among the recently adopted preferential policies for foreign investment were those targets at 'new-type' industries that are intended to serve the National interest such as those involved in the development of energy-saving technologies, technologies for resource regeneration and comprehensive utilization (renewable fuels), and environmental pollution control projects and control technologies. As a result of these preferential policies, the Company received a tax exemption incentive from the Hami government (the level at which income taxes are accessed in China). This exemption provides the Company's Joint Venture with full relief from income tax for five years commencing when the Company first earns a profit. From the sixth to eighth year thereafter, the income tax will be 33% of the then prevailing rate, after which the corporate tax will be accessed at the full rate that now equals to 33% of net earnings.

The Company broke ground for its Hami, Xinjiang Province plant on November 29, 2006. The ground breaking ceremonies were attended by the political leadership of both Hami and Xinjiang Province. The ground breaking ceremonies were widely covered by local and national Chinese electronic and print media reflecting the importance of the project to the region's economy.

According to James Leung, President and CEO of Tiger: "We are gratified to see that the last year of preparation by our staff both in Canada and China is paying off in that we are now ready for the next step of implementation of our project, the construction of the factory. In anticipation, we have had a major engineering design firm prepare preliminary plans for the factory, orders for equipment are being readied and we are confident that we will remain on schedule for the construction and completion of our first plant."

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