Over the past year, public debate about energy policy, energy security and climate change has intensified against rising energy demand. As the global economy changes gears, the energy sector is now feeling the grind. This coupled with diminishing oil reserves where our environment is suffering from unprecedented growth in population. Rapid population and industrial growth in developing countries such as China and India continues to place enormous pressure on energy consumption and our environment.

In these times, branding green investing as a luxury the world cannot afford where enormous investment in the world's energy infrastructure is required in order to address the twin threats of energy insecurity and climate change. The pressing need for energy and environmental sustainability are not only a problem, but an opportunity for investors when measured on a risk-adjusted and total return basis. Large segments of the industry will remain strong in the face of uncertainty and continue to deliver absolute return to investors.

Within the energy sector, the evolving regulatory environment will have clear financial impacts on business models with high carbon exposure. More institutional investors are now deciding that it is prudent to consider the potential impact of their investments on climate change and energy as these two issues will last our life time.

In recent years, we have been actively promoting different measures to reduce harmful emissions, placing particular emphasis towards reducing CO2 emissions. As a green energy pioneer, Enviro Energy has a responsible management team that places tireless effort towards promoting different energy projects that can help ease global warming via our access to technologies such as CCS.  We aim to play an active role in achieving energy efficiency and sustainable development in China.

While the prospect of adapting Asia's energy system is daunting, addressing climate change presents significant business opportunities. Clean energy technologies such as enhanced coalbed methane ("ECBM") and carbon capture and storage ("CCS") will be part of the solution. The IEA recently noted that governments must take the lead by providing direct financing or financial incentives for CCS demonstration projects. G8 countries have announced that 20 large-scale CCS projects must be committed by 2010 at a cost of US$30 to US$50 billion.

With strong demand growth, large investments requirements over the coming years and supportive regulators should enable energy companies to create value for shareholders. Enviro Energy believes changes in market structure and regulations which have recently taken place, are planned or have been proposed, notably in China and the United States will have far reaching consequences for the industry and will create opportunities for sophisticated investors. Long-term strategies for lower-carbon product lines may establish market leadership positions for the company.

Confident in the direction we have charted ahead, we draw guidance from the leadership of a world-class management team consisting of the finest energy experts from around the world to make our vision a profitable reality for our shareholder.

Chairman and CEO