Sewage Treatment Operations at Dalian Changxing Island Harbor Industrial Zone in China

-Participating in world’s first comprehensive “eco-island”-

April 28, 2010

ITOCHU Corporation (headquartered in Minato-ku, Tokyo; Masahiro Okafuji, President & CEO; hereinafter “ITOCHU”) and partner Suez Environnment S.A. (headquartered in Paris; hereinafter “Suez”) of France, one of the world’s largest water and waste management businesses, were consigned by the Changxing Island Harbor Industrial Zone Commission for operation and maintenance service (O&M Service) at the North-South Sewage Treatment Facility. The facility, located in the Dalian Changxing Island Harbor Industrial Zone (hereinafter “Changxing Island Harbor Industrial Zone”) in Liaoning Province, China, has a processing capacity of 40,000 tons/day. ITOCHU will drive the business by establishing a joint venture in the area with the Sino French Water Development Co., Ltd., an affiliate of Suez.

The Changxing Island Harbor Industrial Zone is located in the northwest of the city of Dalian, and the land area under development covers 502 square kilometers. Regional development began in late-2005 as the primary area for the Liaoning provincial government’s Northeastern China Industrial Promotion Measures. Focus has been placed on industries such as shipbuilding, petroleum-petrochemical, equipment manufacturing, biotechnology and pharmaceuticals, energy-conserving and environmentally friendly construction, and harbor logistics. It is regarded as a national project in the national strategy of the Chinese government’s Liaoning Province Coastal Economic Belt Development Plan announced in July 2009, and will be expected to be promoted with support from both the Japanese and Chinese governments. Adopting leading-edge environmental and energy conservation technologies, an “eco-island” will be built in the Dalian area, the gateway to three northeastern provinces that have witnessed rapid economic growth. Companies both within China and from abroad are invited to establish businesses on the island. For this purpose, infrastructure with the world’s highest standards of eco-friendliness, including energy, transportation and other segments, will be built.

ITOCHU regards energy-conservation and environmental businesses in China as a high-priority area. Particular attention has been paid to the Northeastern Regional Industrial Promotion Measures announced in 2003 by the Chinese government. ITOCHU has established bases in all three northeastern provinces and expanded its business activities. In 2009, ITOCHU carried out negotiations with the Liaoning Province government for developing the Changxing Island Harbor Development Zone as an environmentally friendly “eco-island” pursuing energy conservation and environmental protection. The Company has offered numerous proposals in areas such as water treatment, energy, transport and recycling. This is the first contract for ITOCHU in the Changxing Island Harbor Development Zone. It is also the first joint project in China with Suez, one of the world’s largest water and waste management businesses, which is among the priority areas for ITOCHU. We will continue working with Suez in the Chinese market in a wide range of areas.
For the Changxing Island Development Project, we are studying the construction of harbor facilities as they relate to natural resources. ITOCHU will continue to promote projects that contribute to further development of the region.