Investee company update

RNS Number : 3455Z
London Asia Chinese Private Equity
18 July 2008

London Asia Chinese Private Equity Fund Limited
("LACPEF")

Investee company signs major new Coal Methane Project

LACPEF (AIM: LCP.L), the China focused investment company, announces that its investee company, Asia Clean Energy Co. Ltd. ("ACE") has
entered into a joint venture with USA-based Caterpillar, China's State Power International Finance & Trade Corporation Ltd. and Shanxi Xinhe
Energy Co. Ltd. ("the consortium") to develop one of the largest Clean Development Mechanism ("CDM") projects in China. The consortium will
develop a 300MW Coal Mine Methane ("CMM") power generation project in China's Shanxi Province. ACE will own 49% of the joint venture
company.

CMM or Coal Bed Methane ("CBM") is a hazardous gas that can cause major explosions and accidents if not processed properly. CMM is
widely used as an alternative energy source in many parts of the world. China is estimated to have the world's third largest reserve of CMM
and plans to increase the amount it uses in the coming years. The Chinese government actively encourages the use of CMM as an alternative
energy source and has outlined this in its recently published national 11-5 development plan.

The first phase of the Shanxi project will be the development of an 84MW CMM power generation unit, which is expected to be completed in
October 2008. The total investment for phase one will be US$100 million, consisting of US$33 million in equity and US$66 million of debt.

ACE has made an initial investment of $4.29 million. Once this initial pilot scheme is satisfactorily completed, the consortium will
proceed to set up a 300 MW CMM power generation station, with a projected annual coal methane usage of 1.2 billion cubic meters. The methane
will be provided by joint venture partner Shanxi Xinhe Energy Co. Ltd., the largest coal mine company in Jing Cheng, Shanxi province. This
project is estimated to be the largest CMM power generation project in China. Phase II and Phase III of the project are expected to be
completed in 2011 and 2012.

Mr. Zhang Kang Zhu, CEO of ACE, said: "We are very excited to launch this consortium with world class partner companies, to develop what
will be one of the largest CDM power generation projects to date in China. This project is in line with China's commitment to reduce carbon
emissions and develop alternative energy sources, as well as to improve safety at China's mines."

Roy Leighton, Chairman of LACPEF, said: "The returns likely to be generated from this project should have a significant impact on the
value of our holding in ACE once the project is fully operational. ACE's ability to win such a prestigious and strategically important
project for China, with partners of such calibre, demonstrates further the quality of the management team and underlines the opportunities
open to it in the region."

For further information please visit www.lacpefund.com, or contact:

John West/Andrew Dunn Cecilia Wong Helen Goldsmith
Tavistock London Asia Collins Stewart
Communications Ltd. Europe Ltd
Tel: 020 7920 3150 Tel: +852 2251 Tel: 020 7523
8373 8350
cecilia.wong@
londonasia.com

About Asia Clean Energy.
ACE's primary focus is investing in Coal Mine Methane power generating projects, together with other clean renewal energy sources such
as wind power and other related technologies.

This information is provided by RNS
The company news service from the London Stock Exchange

END

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