GreenHunter BioFuels Executes Amendment to Credit Agreement on Biodiesel Refinery with Senior Secured Lender

GRAPEVINE, Texas--(BUSINESS WIRE)--GREENHUNTER BIOFUELS, INC., a refiner and producer of EN and ASTM quality biodiesel that is a wholly-owned subsidiary of GreenHunter Energy, Inc. (NYSE AMEX: GRH), announced today the execution of a definitive Amendment to its existing Credit Agreement with WestLB AG (the “Lender”) in the original principal amount of $38.5 million and $10 million, the Company’s term loan and working capital line of credit with the Lender, respectively. The loan facilities are secured predominantly by the Company’s existing biodiesel refinery assets located in Houston, Texas.

Pursuant to the terms and conditions of the Amendment to the Credit Agreement, the Lender has agreed to waive any claims of Event(s) of Default until November 15, 2009. Additionally, due to the anticipated settlement of certain business interruption and property damage insurance claims with various underwriters related to damages sustained at GreenHunter BioFuels from Hurricane Ike in September, 2008, the Lender will receive a significant paydown on its loans, and additionally will postpone the repayment of the balance of its term loan until November 15, 2009. All remaining funds due from insurance proceeds will be used at GreenHunter BioFuels to fund existing working capital requirements.

Additionally, GreenHunter BioFuels has retained an investment banking firm that will be seeking a potential buyer of the assets, possible domestic and/or international strategic partners, alternative financing possibilities of the existing assets, potential new equity capital, and working capital in a sufficient amount to possibly return the Houston biodiesel refinery to operational status.

Commenting on the definitive Amendment to the Company’s existing Credit Agreement with WestLB, Mr. Gary C. Evans, Chairman, President, and CEO of GreenHunter Energy, stated, “By amending our existing Credit Agreement with WestLB, we have positioned the Company in a manner that should allow us time to seek a number of solutions to our present financial situation. This is especially important now that credit markets have begun to improve and crude oil prices, which have a direct correlation to the price of biodiesel, have recently increased. We are also hopeful that the Federal Government will begin funding the many incentives that have been promised under the new Administration for our industry.”

Forward-Looking Statements

Any statements in this press release about future expectations and prospects for GreenHunter Energy and its business and other statements containing the words “believes,” “anticipates,” “plans,” “expects,” “will” and similar expressions constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including the substantial capital expenditures required to fund its operations, the ability of the Company to implement its business plan, government regulation and competition. GreenHunter Energy undertakes no obligation to update these forward-looking statements in the future.

GreenHunter Energy is focused on the renewable energy sectors of wind, hydro, geothermal, solar, biofuels, and biomass power plants. Our assets consist of leases of real property for future development of wind energy projects located in Montana, California, Texas, and Wyoming and The Peoples Republic of China, one of the nation’s largest biodiesel refinery located in Houston, Texas, a biomass-fired power plant located in Brawley, California, and an option to lease acreage associated with a terminaling facility in Port Sutton, Florida. Headquartered in Grapevine, Texas, GreenHunter Energy was formed to be the first publicly traded renewable energy company based in the U.S. that provides to investors a portfolio of diversified assets in the alternative energy sector. Additional information about GreenHunter Energy may be found at www.greenhunterenergy.com.