October 2, 2008: ShengdaTech Inc. , a manufacturer of nano precipitated calcium carbonate (NPCC) in the People’s Republic of China and a major manufacturer of coal-based chemical products in Tai’an City, says that its melamine products have no connection to the recent reports of dairy products contamination in China.

As a result of the recent incidents of melamine contaminated dairy products in China, the Health Department of Shandong Province conducted an inspection of the sales and distribution channels of many melamine producers, including ShengdaTech. The authorities were satisfied that the company does not sell melamine products to milk farmers or to the dairy industry in general. ShengdaTech’s production of melamine is sold directly to seven customers with chemical factories that use melamine to produce melamine resin, an environmentally friendly alternative to formaldehyde resin.

“We are pleased to report that we have not and do not sell melamine to dairy farmers or milk processors; to the best of our knowledge, our melamine products have not been sold to the dairy industry indirectly,” commented Xiangzhi Chen, president and CEO of ShengdaTech. “We want our shareholders and the investment community to know that there is clearly no link to our chemical products and the truly unfortunate events tied to melamine; therefore there will be no impact on our business. Our records show that our melamine products are sold to a small number of customers for use in the construction market.”