RED.L Regulatory News (RED)

13 August 2012

Camco International Limited

("Camco" or the "Company")

Camco South East Asia to develop 2 megawatt biogas project in Malaysia

Camco International Limited (AIM: CAO), a global developer of clean energy projects and solutions to reduce greenhouse gas emissions, is pleased to announce the first biogas clean energy project for Camco Southeast Asia ("Camco SEA").

The 2MW biogas project, based at a leading palm oil mill in Palong, Pahang state, Malaysia, will use anaerobic digestion to recover biogas containing methane from palm oil mill effluent ("POME"). The project will be amongst the largest of its type to date to generate electricity for supply to the Malaysian national grid.

Camco SEA has acquired the rights to develop the project through the acquisition of Biopower Climate Care Holding SDN Bhd a fully owned subsidiary of Rhodia Energy GHG (France). Camco SEA will continue the construction of the project, with completion of the plant expected in early 2013. Total costs anticipated to be incurred by Camco SEA in developing the project to completion, including the above acquisition, are anticipated to be approximately US$4 million.

Waste, including POME, from the region's 1,000 plus Palm oil plantations is a significant issue for plantation owners, local communities and the region in general and contributes significantly to total emissions. As a result, the Malaysian government recently introduced a renewable energy feed-in tariff to incentivise the conversion of waste into power and it is expected over the coming years that Palm oil producers will come under increasing pressure to reduce waste from their production processes.

The project is being developed under a 13 year build-own-operate-transfer ("BOOT") agreement with the mill owner commencing upon the plant's completion. Under this agreement, the mill owner will provide sufficient POME feedstock free of charge covering the full contract period. Once operational, the plant will generate revenue from the sale of electricity to the grid and from the sale of carbon credits generated under the UN clean development mechanism. The mill owner will receive a portion of the power and carbon sales under a revenue share agreement.

The electricity will be sold to the grid through a renewable energy power purchase agreement ("RE PPA") to be entered into with one of the Malaysia utilities, under the renewable energy feed-in tariff which sets a guaranteed off-take price for the duration of the project (see www.seda.gov.my for further details).

The Palong project is an important milestone for Camco SEA and represents a significant step towards its goal of developing and owning a portfolio of emissions to energy projects across Southeast Asia. With a strong pipeline of future projects and significant project development expertise and local knowledge, Camco SEA is well positioned to deliver on its strategy and become the leading player in the emissions to energy market in the region. The project will be funded directly from existing cash resources within Camco SEA.

Kent Carter, Managing Director of Camco Southeast Asia said:

"I am very pleased with our acquisition of the Palong biogas project, as it strengthens Camco SEA's market position in the biogas development business, one of the fastest growing areas of renewable energy development in the region."

Scott McGregor, CEO of Camco said:

"I am excited to see our strategy of developing and owning clean energy assets extending to South East Asia. Strategically the biogas industry in South East Asia is a key sector to reduce emissions across the region and with our experience and resources available globally we are well positioned to lead this sector."

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Notes to editors:

About Camco:

Camco International Limited (Camco, AIM: CAO) is a global developer of clean energy projects and solutions to reduce greenhouse gas emissions with operations in the US, the UK, China, Africa, Russia and SEA.

Camco has a 20-year track record in project development, technical delivery and policy development, working with local industry, multinational companies, governments and regulatory bodies.

The Carbon Project Development business has created one of the largest emission reductions portfolios and has structured ground breaking and innovative arrangements for the sale and delivery of emission reductions to compliance and voluntary buyers.

Camco's Clean Energy Project Development teams collaborate with industry, project developers, equipment providers and investor groups to create emissions-to-energy projects and maximise sustainable energy production across a range of industries; including agricultural methane, industrial energy efficiency, coal mine methane, municipal solid waste, biomass and landfill gas.

The Energy and Carbon Advisory teams provide strategic, commercial and technical expertise accrued over two decades to deliver low carbon energy and sustainable development solutions.

www.camcoglobal.com

About palm oil biogas in Malaysia:

Malaysia is the world's largest exporter of palm oil products. Malaysia has approximately 4 million hectares of land under oil palm plantation. Over 75% of total area planted is located in just four states, Sabah, Johor, Pahang and Sarawak, each of which has over half a million hectares under cultivation. The palm oil industry is one of Malaysia's important industries and is the fourth largest contributor to the national economy. It currently accounts for RM53 billion in Gross National Income (GNI).

The milling process creates a number of by-products in the forms of Empty Fruit Bunches (EFBs), mesocarp fibers, shells, Palm Oil Mill Effluent (POME) and boiler ash. The most voluminous and ecologically unfriendly of these is POME, with around 58 million tons of POME produced in Malaysia annually. The conventional open pond and digester systems releases large amount of methane and significantly contributes to the green house gas emissions.

Replacing the current standard method of open lagoons, with an anaerobic digester utilises POME as a powerful source of biogas. Malaysia's current POME production has the potential to produce an estimated 15 billion m3 of biogas each year.

Given the abundant availability of palm oil by-products, the industry's economic importance and the growing energy needs of the country, the Malaysian government has responded by making the creation of palm oil biogas digesters an Entry Point Project (EPP) under the National Key Economic Area (NKEA) of Palm oil, making various incentives available for players involved in renewable energy projects utilising palm oil by-products.