ShengdaTech Adds 40,000 Metric Tons Capacity to Nano Precipitated Calcium Carbonate Production Lines

ShengdaTech added two new lines, each with 20,000 metric tons of annual capacity, to its factory at Shengda Industrial Park. The new lines utilize the Company's advanced cost-efficient membrane diffusion technology which lowers production costs of NPCC particles by 5-7% compared to the traditional ultra-gravity method. The membrane diffusion method also provides better quality NPCC particles, providing a broader range of market applications. ShengdaTech is currently developing a number of new NPCC applications in various plastics.

ShengdaTech invested approximately $10 million for the equipment, which increases annual capacity at the factory to 100,000 metric tons and total annual capacity to 130,000 metric tons. The Company expects the new lines to operate at full capacity by November 2007. Assuming full utilization and using current prices after value added tax for NPCC products, the additional 40,000 metric tons of production capacity is equivalent to approximately $15 million in potential additional revenues to ShengdaTech.

"We are very pleased with our progress to date in expanding our capacity. We opened our new factory at Shengda Industrial Park with 60,000 metric tons of capacity in the fall of 2006 and quickly ramped up to full capacity by December 2006.," commented Mr. Xiangzhi Chen, CEO of ShengdaTech. "We develop new applications and our plans call for another expansion of NPCC capacity as early as December of this year."