Mr. Huajun Lin reports

CHANGFENG ANNOUNCES HONG KONG IPO UPDATE AND DECLARATION OF SEMI-ANNUAL AND SPECIAL DIVIDENDS

Changfeng Energy Inc. has provided the following update.

Hong Kong initial public offering

As previously announced, the company has been pursuing an initial public offering of its common shares on the Stock Exchange of Hong Kong Ltd. However, the company has been advised by its financial adviser that the volatile prevailing stock market conditions in Hong Kong have been negative, and are expected to affect the sentiment and appetite of investors in the Hong Kong IPO market. Having considered such market conditions, as well as the expected contribution of the company's new projects as previously announced, which are still either in their development or early operational stages, the board of directors of the company has decided to defer its HK IPO plan until such time as market conditions improve and the board considers it advisable to pursue such plan. Changfeng will continue to review and monitor global stock market conditions, including, in particular, the Hong Kong IPO market, and update shareholders of the company of any change in its plans as and when appropriate.

Annual dividend and special dividend

Pursuant to Changfeng's dividend policy, the company is pleased to announce that the board has approved the total payout for a dividend in respect of the second half of the 2018 financial year of approximately 3.5 million renminbi (approximately $690,996 based on the prevailing exchange rate between the Canadian dollar and the renminbi at the date of this press release), an equivalent of approximately 1.06 cents (2017: 0.94 cent) per common share based on the total common shares outstanding at the date of this press release.

In addition to the second instalment dividend, the board has also approved the declaration of a one-time total payout for a special dividend of approximately 12.9 million renminbi (approximately $2,546,815 based on the prevailing exchange rate between the Canadian dollar and the renminbi at the date of this press release) in recognition of the continuing support of the shareholders of the company. The special dividend will be paid out in two instalments, the first instalment of approximately 6.45 million renminbi (approximately $1,273,408 based on the prevailing exchange rate between the Canadian dollar and the renminbi at the date of this press release), an equivalent of approximately 1.95 cents per common share based on the total common shares outstanding at the date of this press release, will be paid out concurrently with the second instalment dividend.

The board has also approved the first instalment dividend in respect of the 2019 financial year to the amount of approximately 3.5 million renminbi (approximately $690,996 based on the prevailing exchange rate between the Canadian dollar and the renminbi at the date of this press release) with the payment date to be determined.

Both the second instalment dividend and the first instalment of the special dividend are payable on Feb. 26, 2019, to shareholders of record as of the close of business on Feb. 12, 2019. Trading in the common shares of Changfeng will begin on an ex dividend basis at the opening of trading on Feb. 11, 2019.

The second instalment dividend, both instalments of the special dividend and the 2019 first instalment dividend will be designated as an "eligible dividend" for Canadian income tax purposes pursuant to Subsection 89(14) of the Income Tax Act (Canada). Future dividends, to be approved by the board, will be designated as an eligible dividend for Canadian income tax purposes unless otherwise indicated by Changfeng.

The aggregate amount of dividends to be distributed in 2019, including the second instalment dividend, both instalments of the special dividend and the 2019 first instalment dividend, aggregate to 19.9 million renminbi (approximately $3,928,808 based on the prevailing exchange rate between the Canadian dollar and the renminbi at the date of this press release), an equivalent of approximately 6.02 cents per common share based on the total common shares outstanding at the date of this press release.

"In appreciation of the continuing support of our investors, we have raised our semi-annual dividend for the 2018 year and declared a special dividend. I would also like to thank our shareholders for bearing with our decision to defer the HK IPO plan. It is unfortunate that market conditions are not conducive to pursuing such plan at this time," said Huajun Lin, president, chief executive officer and chairman of the company.

About Changfeng Energy Inc.

Changfeng Energy is a Canadian public company currently traded on the TSX Venture Exchange under the stock symbol CFY. It is an integrated energy provider and natural gas distribution company (or natural gas utility) in the People's Republic of China. Changfeng strives to combine leading clean energy technology with natural gas usage to provide sustainable energy to its customer base in the PRC.

We seek Safe Harbor.