Although Methanol Expansion is Approximately 80% Complete, 
            Company has Moved Estimated Start-up to Mid-Summer 
                             At The Earliest

       While Anticipating Margin Improvement and Sales Increase in 
              Fertilizer, Company Sees Full Year Results Down

       Earnings Call To Be Held Tomorrow -- Tuesday, February 24 at 
                              8:00 a.m. EST

NEW YORK, Feb. 23, 2009 (GLOBE NEWSWIRE) -- New Oriental Energy & Chemical Corp. (Nasdaq:NOEC), a specialty chemical and emerging coal-based alternative fuel manufacturer in The People's Republic of China (the "PRC"), said today that continuing shifts during the third quarter in raw material and specialty chemical prices produced negative margins in most of its products which resulted in a substantial loss in the period. This necessitated significant changes in its production levels and sales mix which also reduced third quarter revenues.

Revenues Down Sharply

The Company reported that decreased production of urea -- the Company's most significant "traditional" product -- combined with lower selling prices, lowered the revenue contribution of this product 20.51% to $6.25 million in the third quarter compared with $7.87 million in the same quarter last year. It explained that while sales volume of urea in the quarter of 26,261 tons was slightly higher than in the second quarter this year, it was significantly lower than the 33,478 tons sold in the third quarter last year. Additionally, the average selling price of $238.22 per ton in the third quarter was 30% lower than the $343.17 average selling price in this year's second quarter.

The Company noted that it has been pleased to see a continuing decline in the price of coal, the key raw material in its urea and methanol production. However, while it fell from its peak in October 2008 of $158 per ton to a current (February 2009) price of approximately $108 per ton, this is still about 70% higher than the average price of coal in the third quarter last year. Further, the price in the quarter only declined to $130 per ton by the end of December 2008, which was roughly one month after the price drop that occurred in urea.

With respect to the Company's main alternative fuel products, methanol and dimethyl ether (or DME, which is principally derived from methanol) the third quarter price drop for DME compared to the second quarter this year was about 30% to $435 per ton. For methanol the decline was about 40% to an average price of about $231 per ton during the quarter. As was the case with urea, the decline in the cost of coal trailed the decline in the price of these products. Under these circumstances, production was adjusted substantially downward, with the most significant decline occurring in DME sales from 18,033 tons in the third quarter last year, to only 5179 tons in this year's third quarter.

Third Quarter and Nine Months Results

Reduced prices and production led to a 78.97% decline in DME revenues to $2.25 million in this year's third quarter, compared to the same period last year, while revenues were down 43.6% for methanol in the quarter to $199,899. Combined with the described decrease in the contribution from urea sales, overall revenues in this year's third quarter decreased 47.37% to approximately $10.6 million. For the nine month period, the Company reported that revenues declined nearly 24% to about $40.5 million compared to the same period last year.

The resulting net loss in the third quarter ended December 31, 2008 was ($2,130,827) or ($0.17) per share, compared with net income in last year's third quarter of $2,183,010 or $0.17 per share. For the nine months ended December 31, 2008, the net loss was ($1,858,266), or ($0.15) per share as compared with net income of $4,072,986, or $0.32 per share in the nine months ended December 31, 2007.

Update on Methanol Expansion

The Company said that during the quarter it continued to make progress on the construction of a new methanol plant, which is now 80% complete. Upon completion -- and under more normalized economic conditions -- the new plant is expected to significantly reduce the Company's cost of methanol production. With the Company's total production capacity increased to 200,000 tons, it also will eliminate the need to utilize purchased methanol to produce DME. Further, it will potentially make the Company one of the largest methanol producers in China.

Thus far, the Company has utilized its cash flow and limited borrowings to finance the plant, but said it is seeking additional capital from local sources to complete the project. Despite the current economic environment, the Company is very confident that with the Chinese government strongly encouraging banking support of local companies and flexible financing strategies, it will obtain the necessary capital. Nevertheless, with an expectation that reduced demand for methanol and DME will continue to prevail at least in the near term, the Company says it is stretching the target completion of the expansion to about mid-summer at the earliest.

Going Forward -- Anticipated Positive Margin For Urea

Mr. Chen Si Qiang, CEO and Chairman of the Company, commented, "In this extremely difficult environment we have been doing our very best to deal with the unanticipated situation with respect to raw material cost and product pricing facing everyone in the industry. We also are maintaining confidence in our ability to improve our near term performance as the cost of coal continues to moderate, as we believe is the case. Further, we believe that upon completion of the new methanol plant, we will be well positioned to achieve very substantial gains from DME and methanol when the environment improves."

"In the case of urea," he continued, "we believe the pressing agricultural need for this product, particularly in the April-May season, will translate to improved selling prices, and note that the government has now lifted the upper cap on fertilizer prices. If as anticipated, we see a further decline in the price of coal, possibly to levels seen in 2007, we should soon be able to generate higher revenues and a positive margin for urea."

"With respect to our alternative energy product portfolio," Mr. Chen said, "we see a longer time horizon for a return to profitability, mainly due to lower energy prices. We remain convinced, however, that given China's continuing near total dependence on foreign oil, the government will continue to strongly encourage alternative fuel production. As such, with an increase in the price of oil to even one third or so of its most recent peak prices, we see the demand for methanol and DME increasing dramatically. In this regard, we continue to see an intermediate term possibility of increased demand for methanol if legislation to increase the methanol/gasoline mix is passed. Short term, we are not planning for increased production volume in either DME or methanol and expect urea to become a bigger part of our product mix. And, even if we begin to see profits in urea in the fourth quarter, we anticipate the Company's full year results will be lower than last year. Previously, we have said they likely would be flat to down."

Conference Call Invitation

The Company will host a conference call to discuss its third quarter results for the period ended December 31, 2008 on February 24, 2009 at 8:00 a.m. ET.

Interested participants should call 1-800-762-8779 when calling within the United States or 1-480-248-5081 when calling internationally. Please ask for the New Oriental Chemical & Energy Corp. Third Quarter Earnings Conference Call, Pass Code 4002465. There will be a playback available until 03/03/2009. To listen to the playback, please call 1-800-406-7325 when calling within the United States or 1-303-590-3030 when calling internationally. Use the Pass Code 4002465 for the replay.

This call is being webcast by ViaVid Broadcasting and can be accessed by clicking on this link, http://viavid.net/dce.aspx?sid=00005E8F, or at ViaVid's website at www.viavid.net. The webcast can be accessed through 2/24/10.

About New Oriental Energy & Chemical Corp.

New Oriental Energy & Chemical Corp., listed on the NASDAQ Global Market (Nasdaq:NOEC), is an emerging coal-based alternative fuels and specialty chemical manufacturer based in Henan Province, in the PRC. The Company's core products are Urea and other coal-based chemicals primarily utilized as fertilizers. Future growth is anticipated from its focus on expanding production of coal-based alternative fuels, in particular, methanol, as an additive to gasoline and dimethyl ether (DME), which has been a cheaper, more environmentally friendly alternative to LPG for home heating and cooking, and diesel fuel for cars and buses. All of the Company's sales are made through a network of distribution partners in the PRC. Additional information on the Company is available on its website at www.neworientalenergy.com.

Safe Harbor Statement

This press release may contain forward-looking statements concerning New Oriental Energy & Chemical Corp. The actual results may differ materially depending on a number of risk factors including, but not limited to, the following: general economic and business conditions, development, shipment, market acceptance, additional competition from existing and new competitors, changes in technology or product techniques, and various other factors beyond its control. All forward-looking statements are expressly qualified in their entirety by this Cautionary Statement and the risk factors detailed in the Company's reports filed with the Securities and Exchange Commission. New Oriental Energy & Chemical Corp. undertakes no duty to revise or update any forward-looking statements to reflect events or circumstances after the date of this release.

  NEW ORIENTAL ENERGY & CHEMICAL CORP. CONDENSED CONSOLIDATED
  STATEMENTS OF (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME
  (UNAUDITED)

                   Three Months Ended           Nine Months Ended
                       December 31,                December 31,
                -------------------------   -------------------------
                   2008          2007          2008          2007
                -----------   -----------   -----------   -----------
 REVENUES       $10,614,418   $20,168,977   $40,533,491   $53,222,726

 COST OF GOODS
  SOLD          (11,971,384)  (15,760,191)  (40,097,429)  (44,366,458)
                -----------   -----------   -----------   -----------

 GROSS (LOSS)
  PROFIT         (1,356,966)    4,408,786       436,062     8,856,268

 General and
  administrative    546,822       780,861     1,996,928     1,793,510

 Selling and
  distribution      367,424       277,661       928,534       927,376

 Research and
  development        14,292            --       123,392            --
                -----------   -----------   -----------   -----------

 (LOSS) INCOME
  FROM
  OPERATIONS     (2,285,504)    3,350,264    (2,612,792)    6,135,382

 OTHER INCOME
  (EXPENSES)

 Interest
  expense, net     (485,891)      (92,231)     (897,869)     (355,489)

 Government
  grants            501,622         1,350     1,490,489        81,123

 Other
  (expenses)
  income, net            --        35,398       (33,418)       43,332
                -----------   -----------   -----------   -----------

 (LOSS) INCOME
  FROM OPERATIONS
  BEFORE INCOME
  TAXES          (2,269,773)    3,294,781    (2,053,590)    5,904,348

 INCOME TAX
  BENEFIT
  (EXPENSE)         138,946    (1,111,771)      195,324    (1,853,053)
                -----------   -----------   -----------   -----------

 (LOSS) INCOME
  FROM CONTINUING
  OPERATIONS     (2,130,827)    2,183,010    (1,858,266)    4,051,295

 DISCONTINUED
  OPERATION

 Gain from
  discontinued
  operation (net
  of income tax
  of $396)               --            --            --         1,761

 Gain from
  disposition of
  discontinued
  operation              --            --            --        19,930
                -----------   -----------   -----------   -----------

 NET (LOSS)
  INCOME         (2,130,827)    2,183,010    (1,858,266)    4,072,986
                -----------   -----------   -----------   -----------

 OTHER
  COMPREHENSIVE
  INCOME

 Foreign
  currency
  translation
  gain               73,288       559,942       478,332     1,097,290
                -----------   -----------   -----------   -----------

 OTHER
  COMPREHENSIVE
  INCOME BEFORE
  TAX                73,288       559,942       478,332     1,097,290

 INCOME TAX
  EXPENSE
  RELATED TO
  OTHER
  COMPREHENSIVE
  INCOME                 --       184,781            --       362,105
                -----------   -----------   -----------   -----------

 OTHER
  COMPREHENSIVE
  INCOME, NET        73,288       375,161       478,332       735,185

 COMPREHENSIVE
  (LOSS)
  INCOME        $(2,057,539)  $ 2,558,171   $(1,379,934)  $ 4,808,171
                ===========   ===========   ===========   ===========

 WEIGHTED
  AVERAGE SHARES
  OUTSTANDING,
  BASIC AND
  DILUTED        12,640,000    12,640,000    12,640,000    12,640,000
                ===========   ===========   ===========   ===========

 (LOSS) INCOME
  FROM CONTINUING
  OPERATIONS PER
  SHARE, BASIC
  AND DILUTED   $     (0.17)  $      0.17   $     (0.15)  $      0.32
                ===========   ===========   ===========   ===========
 INCOME FROM
  DISCONTINUED
  OPERATION PER
  SHARE, BASIC
  AND DILUTED   $        --   $        --   $        --   $      0.00
                ===========   ===========   ===========   ===========
 NET (LOSS)
  INCOME PER
  SHARE, BASIC
  AND DILUTED   $     (0.17)  $      0.17   $     (0.15)  $      0.32
                ===========   ===========   ===========   ===========

                 NEW ORIENTAL ENERGY & CHEMICAL CORP.
                CONDENSED CONSOLIDATED BALANCE SHEETS

                                ASSETS
                                ------
                                            December 31,   March 31,
                                               2008          2008
                                            -----------   -----------
                                            (Unaudited)
 CURRENT ASSETS
   Cash and cash equivalents                $   446,028   $ 7,487,808
   Restricted cash                            4,389,430     5,438,809
   Notes receivable, net of reserve of
    $146,314 and $135,563 at December 31,
    2008 and March 31, 2008, respectively       596,963       647,908
   Inventories, net                           4,117,065     2,171,040
   Prepayments for goods                        257,658     1,196,831
   Due from employees                            27,784        13,213
   Other assets                                  48,803       134,993
   Due from related parties                     254,317            --
                                            -----------   -----------
     Total current assets                    10,138,048    17,090,602
                                            -----------   -----------

   Long-term investment                         469,669            --
   Plant and equipment, net                  19,386,472    20,102,938
   Land use rights, net                       1,646,648     1,629,633
   Construction in progress                  24,333,197     9,740,638
   Deposits                                   2,075,125     1,978,389
   Deferred taxes                               185,928       179,541
   Other long-term assets                        11,747        32,574
                                            -----------   -----------
     Total long-term assets                  48,108,786    33,663,713
                                            -----------   -----------

   TOTAL ASSETS                             $58,246,834   $50,754,315
                                            ===========   ===========

                 LIABILITIES AND SHAREHOLDERS' EQUITY
 CURRENT LIABILITIES
   Accounts payable                         $ 6,938,489   $ 1,656,883
   Other payables and accrued liabilities       648,318       545,090
   Short-term debt                           15,746,349    17,954,837
   Customer deposits                          6,865,774     4,220,527
   Payable to contractors                     1,726,398       506,364
   Due to related parties                     8,259,884     5,708,995
   Taxes payable                                634,625     1,424,992
                                            -----------   -----------
     Total current liabilities               40,819,837    32,017,688
                                            -----------   -----------

 LONG-TERM LIABILITIES
   Long-term notes payable                      531,121       517,168
   Deferred taxes                               826,016       773,449
   Due to employees                             160,301       156,517
                                            -----------   -----------
     Total long-term liabilities              1,517,438     1,447,134
                                            -----------   -----------

 TOTAL LIABILITIES                          $42,337,275   $33,464,822
                                            ===========   ===========

 SHAREHOLDERS' EQUITY
   Common stock, par value $0.001 per
    share; 30,000,000 shares authorized,
    12,640,000 shares issued and
    outstanding as of December 31, 2008
    and March 31, 2008, respectively             12,640        12,640
   Additional paid-in capital                 4,573,205     4,573,205
   Retained earnings (restricted portion
    was $950,327 as of December 31, 2008
    and March 31, 2008, respectively)         8,768,233    10,626,499
   Accumulated other comprehensive income     2,555,481     2,077,149
                                            -----------   -----------
 TOTAL SHAREHOLDERS' EQUITY                  15,909,559    17,289,493
                                            -----------   -----------

 TOTAL LIABILITIES AND SHAREHOLDERS'
  EQUITY                                    $58,246,834   $50,754,315
                                            ===========   ===========

CONTACT:  New Oriental Energy & Chemical Corp.
          Mr. Li Donglai, Chief Financial Officer
          (011-86) 139-3764-6299
          Xicheng Industrial Zone of Luoshan, Xinyang
          Henan Province, The People's Republic of China
     
          East West Network Group 
          Investors:
          Mark Miller
          (770) 436-7429
          mmeastwest@hotmail.com
     
          DGI Investor Relations 
          Press:
          Ken Donenfeld
          (212) 425-5700
          Fax: (212) 425-6951
          donfgroup@aol.com
          kdonenfeld@dgiir.com