Gushan opens Beijing biodiesel plant

Fuzhou City, China-based Gushan Environmental Energy (NYSE: GU) said today its Beijing biodiesel plant has started production, adding 50,000 tons of annual capacity to the company.

The facility's opening comes just over a month after the company started trading on the New York Stock Exchange (see Gushan sets price for biodiesel IPO).

Gushan, China's largest producer of biodiesel, has been trading below its initial offering price of $9.60 per share, closed at $8.13 yesterday.

"Construction of this plant was completed ahead of our original schedule and within our prior estimated budget," said Jianqiu Yu, chairman of Gushan.

"We believe this milestone is a testament to our ability to efficiently expand our production lines and execute our growth strategy."

The company said annual capacity of the Beijing plant is expected to increase to 100,000 tons in the fourth quarter of this year when additional expansion is completed.

In addition to the Beijing plant, Gushan plans to open a biodiesel plant with a capacity of 50,000 tons per year in Shanghai in the second quarter of this year, followed by plants in Chongqing and Hunan, each with initial capacities of 30,000 tons per year, in the fourth quarter.

The company, with a current annual production capacity of 240,000 tons, said it expects to increase its annual production to 400,000 tons by the end of 2008.

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