SinoCoking Enters Into Three-Party Venture for the Annual Purchase, Financing and Sale of 300,000 Tons of Coking Coal

PINGDINGSHAN, China, Jan. 12, 2015 (GLOBE NEWSWIRE) -- SinoCoking Coal and Coke Chemical Industries, Inc. SCOK, a vertically integrated producer of clean energy products located in Henan Province, today announced it had entered into a three-party venture with Fangda Special Steel Technology Co. Ltd, China's largest automotive steel spring manufacturer, and with Henan Shenhuo Group, one of the six largest state-owned coal mining companies in Henan Province, whereby Fangda will provide SCOK with Letters of Guarantee on a monthly basis, issued to Henan Shenhuo, to guarantee payment for a minimum of 300,000 tons of coking coal in 2015.

Under terms of the multi-party agreement, SinoCoking will purchase clean, high-quality coking coal from Shenhuo at prices six percent below market. By providing the Letters of Guarantee, Fangda secures through SinoCoking its current supply needs for coking products, with SinoCoking expecting Fangda's supply requirements to increase up to 6 million tons over the next three years. Fangda will purchase a minimum of 240,000 of finished coke in 2015.

"We are delighted by this significant business development by which we and our primary coke supplier and major coke customer all benefit," said SinoCoking Chairman and CEO, Mr. Jianhua Lv. "These agreements will insure an uninterrupted supply of coking coal from Shenhuo Group and guaranteed sales to Fangda. At the same time it provides a mechanism that reduces SCOK's cash needs for purchasing raw materials and frees up more of our working capital and credit to invest in the build-out and expansion of our syngas production facilities."

Mr. Lv also noted that Shenhuo's production facility is located only 65 km from the company's Baofeng factory, and he expects this close proximity - relative to the locations of current suppliers - will generate additional savings due to lower transportation costs. "Combining better pricing on coal with this transportation benefit, we expect the cost of sales in our coking division to decrease by about 10 percent."

"Our three party cooperation with Shenhuo and SinoCoking," added Chen Wen, Purchasing Director of Fangda Group, "will provide us with high quality coke products on a consistent basis. It will ensure that Fangda's steel products continuously meet their production targets and quality standards, and at the same time will improve each partner's overall competitiveness."

For additional information on SinoCoking, please go to http://scokchina.com or refer to the company's periodic reports filed with the Securities and Exchange Commission (http://www.scokchina.com/sec-filings.html). Investors wishing to receive SinoCoking's corporate communications as they become available may go to the company's Investor Relations site (http://www.scokchina.com/corporate-overview.html) and register under Email Alerts.

Also, investors may submit questions directly to Mr. Lv and his staff to receive non-confidential information about the company's operations and products at the company's "Ask Management" blog (http://www.scokchina.com/ask-management.html).

About SinoCoking

SinoCoking Coal and Coke Chemical Industries, Inc. (www.scokchina.com), a Florida corporation, is an emerging producer of clean energy products located in Pingdingshan, Henan Province, China. The company has historically been a vertically-integrated coal and coke processor of basic and value-added coal products for steel manufacturers, power generators, and various industrial users. SinoCoking has been producing metallurgical coke since 2002, and acts as a key supplier to regional steel producers in central China. SinoCoking also produces and supplies thermal coal to its customers in central China. SinoCoking currently owns its assets and conducts its operations through its subsidiaries, Top Favour Limited and Pingdingshan Hongyuan Energy Science and Technology Development Co., Ltd., and its affiliated companies, Henan Province Pingdingshan Hongli Coal & Coke Co., Ltd., Baofeng Coking Factory, Baofeng Hongchang Coal Co., Ltd., Baofeng Hongguang Environment Protection Electricity Generating Co., Ltd., Zhonghong Energy Investment Company, Henan Hongyuan Coal Seam Gas Engineering Technology Co., Ltd., Baofeng Shuangri Coal Mining Co., Ltd., and Baofeng Xingsheng Coal Mining Co., Ltd.

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