The Board is pleased to announce that, on 17 August 2010, the Company entered into a joint venture agreement (the “Joint Venture Agreement”) with Tianjin Gas Group, pursuant to which the parties agreed to establish a Sino-foreign co-operative joint venture in the PRC, which shall be named PetroChina Tianjin Natural Gas Pipeline Company Limited (the “JV Company”) .
The JV Company will principally engage in gas pipeline construction and operation; coordination in gas supply to Tianjin; natural gas processing, storage, transmission and related operations; supply and sale of natural gas, compressed natural gas (CNG) and liquefied natural gas (LNG) and related operations; and leasing of gas facilities and equipment.
The establishment of the JV Company is subject to the approval of the relevant PRC regulatory authorities.
Pursuant to the Joint Venture Agreement, the expected total investment amount of the JV Company is RMB1,500.00 million (equivalent to approximately HK$1,702.42 million).
The total registered capital of the JV Company is RMB500.00 million (equivalent to approximately HK$567.47 million).
The Company and Tianjin Gas Group have agreed to inject 51% and 49% of the total registered capital into the JV Company respectively.
The total amount for the initial capital injection by both parties is RMB100.00 million (equivalent to approximately HK$113.49 million) payable in cash.
For the initial capital injection, the Company is responsible for RMB51.00 million (equivalent to approximately HK$57.88 million) whereas Tianjin Gas Group is responsible for RMB49.00 million (equivalent to approximately HK$55.61 million).
Within two years from the date of the issue of the business licence of the JV Company, each of the Company and Tianjin Gas Group shall contribute, by way of tangible assets or cash, the remaining registered capital in the proportion of 51% and 49% respectively.
SCOPE OF COOPERATION
Through the construction of pipeline network, introducing natural gas sources from two high-pressure pipelines in Caofeidian Tang Shan (LNG) and Yong Tang Qin, at the northern part and connect to Dagang Oilfield and gas storages at the southern part; constructing and operating five high-pressure natural gas pipelines, the pipeline at State Highway 112 (east section), Bao Jing Pipeline, high-pressure ground connection pipeline, Huanggang High Pressure Pipeline (south section) and Gang-Huang High Pressure Pipeline (Tianjin Section); forming a network of upstream gas resources and distribution network; building underground gas storage ancillaries; developing, establishing and operating the natural gas market in Dagang area (including Nangang Industrial Zone).
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Source: Kunlun Energy, August 18, 2010;