GreenHunter Wind Energy

Wind Energy Basics

Wind energy, the world’s fastest-growing energy source, is a clean and renewable source of energy that has been in use for centuries throughout Europe and, more recently, in the United States and other nations, becoming an increasingly popular choice for new electricity generation around the world. Wind turbines, both large and small, produce electricity for utilities and homeowners and remote towns.

North America is expected to continue as the second-largest regional market in terms of total installed capacity, with anticipated average annual growth of approximately 25 percent.

Current Wind Projects

We currently have three wind projects in development. These projects are located in Wyoming and Texas. Currently all our wind projects are in various stages of environmental impact studies, meteorological evaluations and various other regulatory approvals and processes.

Management intends to utilize its existing financing sources or access new capital available in the market to fund our wind projects. The business of producing electricity from wind energy is not a seasonal business. We may be required to enter into a power purchase agreement with a utility to purchase the electricity generated by our properties in order to be successful in developing our wind assets. We may also choose to sell our wind power in to the merchant market. We have budgeted $90 million to develop a 50MW wind farm. This capital is currently anticipated to be spent in the year 2008. In addition, beginning in 2009, we anticipate spending a minimum of $2 million per year developing our additional wind prospects.

Investment in MingYang

GreenHunter executed a Subscription and Equity Transfer Agreement whereby GreenHunter will acquire a 6.30 percent equity interest in MingYang Wind Power Technology Co., Ltd, (“MingYang”) based in Guang Dong Province, People’s Republic of China (“PRC”) for approximately $10 million USD. GreenHunter’s investment has been approved by the appropriate governmental authorities to allow for a foreign investment in the PRC. We have certain anti-dilution protective provisions and preemptive rights in connection with our investment.

MingYang is involved in the manufacturing of industrial-scale wind turbines in the PRC. MingYang anticipates that once it reaches full production capacity at its new manufacturing plants within the next couple of years, it will become one of the largest manufacturers of wind turbines in the PRC. MingYang has existing orders from companies for installation of wind turbines within the PRC that exceed 1,000 MW.

In addition, Wind Energy has executed a landmark master turbine supply agreement with MingYang. This agreement allows Wind Energy to potentially purchase more than 900 MW of new capacity for wind projects to be developed between 2008 and 2012 in North America.

Key components of this transaction are as follows:

In 2008 Wind Energy will have the option to purchase up to 108 MW of turbines (1.5 MW-sized machines) for new projects in the United States.
During 2009 through 2012, Wind Energy has the preferential right to purchase any turbines to be exported by MingYang to North America.
During 2008 through 2012, Wind Energy will have the right to purchase larger capacity turbines if MingYang manufactures such turbines.
MingYang will provide maintenance services through a services agreement between the two companies.

The following is a brief summary of each of our current wind projects:

Wyoming

Wheatland Wind Project, Platte County

Right-of-way application with Bureau od Land Management for approximately 22,000 acres.
Signed agreement with Wind Revolutions, a wind development company, to purchase up to 100%
of the project.
Will connect to proposed Wyoming-Colorado interconnection (WC1) line.
(2) 60 meter meteorological towers installed in Q3 2008.
Potential for 400 MW project.
1 Meteorological tower proposed for third quarter 2008.