Hanwei Energy Services Corp.
TSX : HE

Hanwei Energy Services Corp.

December 15, 2014 07:00 ET

Hanwei Energy Confirms New 10KM Canadian Line Pipe Order Including First Canadian Polymer Flood Application

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec. 15, 2014) - Hanwei Energy Services Corp. (TSX:HE) ("Hanwei" or the "Company") today announced that it has been awarded a new 10 kilometer line pipe order for the supply of the Company's 3" and 4" diameter high pressure, glass reinforced epoxy ("GRE") pipes and fittings.

This order, valued at approximately $0.4 million will be immediately produced and shipped during December 2014. The order includes applications for polymer injection, saltwater injection, and oil transmission line pipe within existing, producing fields in Alberta.

The polymer injection piping is for an initial, pilot order by the customer that is the first phase of a potential four phase, $2 million pipe installation that forms part of a new $180 million, third stage recovery facility recently opened. The facility is now completing its support infrastructure that includes the GRE piping installations.

Primary recovery of oil occurs as a result of oil naturally flowing to surface through a wellbore due to pressure with secondary recovery involving the localized injection of water or gas; these recovery techniques usually only recover a small fraction of the original oil-in-place. Third stage recovery, through such methods as polymer injection is increasingly used in oil field operations to enhance or maintain production and increase recovery.

This is the first use of Hanwei GRE pipe in a Canadian polymer flood application. Market assessment undertaken by a customer of Hanwei indicates a potential market of $15 million to $20 million per annum for GRE pipe products utilized for polymer floods in Canada. Hanwei's GRE pipe products have been extensively used in China for polymer floods as part of third stage, enhanced oil recovery projects due to the pipes' stable performance to operate at very high temperatures up to 93 degrees C and in highly corrosive, high pressure environments.

Separately from this new line pipe order, the Company has also produced and shipped to Canada the first of three delivery phases for its $4.1 million order that was previously announced on October 29, 2014. This first delivery was valued at approximately $1.2 million. The remaining two delivery phases are expected to be shipped within the Company's current fiscal year ending March 31, 2015.

About Hanwei Energy Services Corp.

Hanwei Energy Services Corp.'s principal business operations are in two complementary key segments of the oil and gas industry as both an equipment supplier to the industry (as a leading manufacturer of high pressure, fiberglass reinforced plastic ("FRP") pipe products and associated technologies serving major energy customers in the global energy market) and as an operator of its producing oil and gas mineral rights at its Leduc Lands in Alberta. www.hanweienergy.com

Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.

FORWARD-LOOKING INFORMATION AND NON-GAAP MEASURES

Certain information in this press release is forward-looking within the meaning of certain securities laws, and is subject to important risks, uncertainties and assumptions a description of which is set out in the risk factors section of the Company's Annual Information Form dated June 20, 2014 and Management Discussion and Analysis for the year ended March 31, 2014 both of which are filed with Canadian securities regulators and available on SEDAR at www.sedar.com. The forward-looking information in this press release describes the Company's expectations as of the date of this press release.

THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS PRESS RELEASE PRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS PRESS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, THE COMPANY DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME, EXCEPT AS REQUIRED BY APPLICABLE SECURITIES LEGISLATION.

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