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Puda Coal, Inc. Announces Record Client Contract

New Contract for Delivery of Cleaned Coal Is 46% Larger Than Previous Largest Contract to Date

Puda Coal, Inc. ("Puda" or the "Company") (OTC BB: PUDC), a leading supplier of China's highest grade metallurgical coking coal -- which is used to make coke for the purposes of steel manufacturing -- announced today that it has formally signed a new one-year supply contract with existing customer Baotou Iron & Steel (Group) Company, Ltd. ("Baotou"), the 17th largest steel mill in China. Puda has begun providing Baotou with 58,000 metric tons (MT) per month, or 700,000 MT for the year. The contract calls for an annual delivery that is:

46% larger than the previous largest client contract to date, signed as recently as November 2005,

22,347 tons more than the 677,653 MT delivered across all clients in 2005 and

596,291 tons more than the 103,708 MT Puda delivered to Baotou in 2005 -- a 575% increase.

Puda's recent strategic decision to grow its coal cleaning capacity from 500,000 MT to 2.7 million MT by early 2006 was integral in securing supply contracts of this size, both from new customers and its existing customer base. "With our significantly expanded capacity, we can now market ourselves as a principal supplier to some of the largest steel manufacturers in the region, and indeed in all of China," said Puda Chairman and Chief Executive Officer Zhao Ming. "In addition, we can now become an even more important part of our existing customers' business, as we have recently with Baotou Iron & Steel."

About Puda Coal, Inc.

Puda Coal, through its affiliates and controlled entities, supplies premium grade coking coal to the steel making industry for use in making coke. The Company currently processes 1.5 million metric tons of coking coal annually, and management believes it is one of the largest coke coal cleaning companies in terms of capacity in Shanxi Province, China. Shanxi Province provides 20-25% of China's coal output and supplies nearly 50% of China's coke.

FORWARD-LOOKING STATEMENTS

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Distributed by Market Wire