Cathay Forest Products Corp.
TSX VENTURE : CFZ

Cathay Forest Products Corp.

May 09, 2008 08:30 ET

Cathay Forest's Russian Timber Partner Receives Favourable Status

TORONTO, ONTARIO--(Marketwire - May 9, 2008) - Cathay Forest Products Corp. (TSX VENTURE:CFZ), is pleased to announce that the Ministry of Industry and Power Engineering of the Russian Federation has included Cathay's Russian joint venture timber project in the list of Priority Investment Projects. This policy is referred to as the Priority Investment Program ("PIP"), which governs tariff exemptions.

As detailed in Decree #419 of the Government of the Russian Federation favourable treatment has been awarded to Cathay's subsidiary, DalEuroLes for future timberland development projects. Favourable treatments include obtaining more harvesting concessions and export tax exemption for downstream processed wood products. Subject to further approvals by the Federal Government, DalEuroLes could enjoy tax exemption on the export of roundwood.

DalEuroLes is also being included in the list of companies qualified to apply for a refund of between 50 percent to all of the costs of constructing the infrastructure at its existing and future timber properties such as bridges, roads and landing sites.

The Company has also engaged forestry consultant firm, Indufor to prepare a study on the current and future development of the Russian timber property. Indufor is an independent Finnish consulting company established in 1980. Indufor provides worldwide consulting and advisory services in areas of forest resource management, nature conservation, and environmental management. Support services to institutional and public sector clients are provided, in the realms of project planning, implementation and evaluation. Indufor's focus is on sustainable development - economic, social and environmental.

About Cathay Forest Products

Cathay Forest is a forest products company manages approximately 300,000 hectares of standing timber properties and fast-growth, high-yield poplar plantations in China and Russia. Cathay Forest is building a world-class forest products company through a customer base that includes the domestic Chinese pulp and paper industry as well as a variety of other wood products industries.

Forward-Looking Statements

All statements, other than statements of historical fact, in this news release are forward-looking statements that involve various risks and uncertainties, including, without limitation, statements regarding the future plans and objectives of the Company. Actual results and future events could differ materially from those anticipated in such statements. The Company assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy of this release.

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