BEIJING, November 20, 2014 /PRNewswire/ -- Recon Technology, Ltd. (Nasdaq: RCON), a leading independent oilfield services provider operating primarily in China, today said it is providing services on oilfield service contracts valued at RMB6.4 million, or over $1 million, to provide automation solutions for Chinese oil companies' domestic and overseas projects.
The first contract, signed with Tangshan Jidong Petroleum Mechanic Co. Ltd. in September 2014, calls for Recon to examine and repair Tangshan Jidong's oilfield automation systems located at a wellsite in Caofeidian, Tangshan City, Hebei province of China. This will include replacing defective hardware, performing software data backup and program optimization, and ensuring that the internal alarm system operates efficiently. Recon will receive a total of approximately RMB1.3 million for these services.
The second contract with Tangshan Jidong entered in March and August of 2014 involves Recon providing various oil and gas surface gathering and transportation systems at CNPC's Jidong Oilfield at the same wellsite in Tangshan City. This contract is worth approximately RMB3.6 million to Recon.
Recon also is serving a series of contracts with China National Petroleum Corporation's Sichuan Petroleum Administration Bureau, which were entered into earlier this year. These agreements, worth nearly RMB1 million, call for Recon to provide Sichuan Petroleum with automation systems hardware and various maintenance services for that company's pipeline systems at its South Yolotan Gas Field Project in Turkmenistan.
Recon also had ancillary contracts valued at RMB 0.6 million with Sinopec Southwest Company to continue maintain service for prior projects located in Sichuan Province.
Management believes a substantial portion of the revenue from the above contracts will be recognized in the quarter ended December 31, 2014.
Recon chairman and CEO Mr. Shenping Yin said the these contracts represented evidence that our company's business for the quarter ending December 31, 2014 will be better than the quarter ending September 30, 2014.
"These agreements, with some of the largest oil and gas entities in China, once again demonstrate that Recon is regarded as possessing highly advanced technological expertise in improving the efficiency, safety and profitability of oilfield production.
Recon's automation systems, said the CEO, provide oil and gas production companies with many key benefits, including reducing the number of workers on-site, increasing workplace safety, generating production reports automatically and reducing or eliminating human error in the preparation of these reports.
These benefits, he said, can increase an oilfield producer's productivity and can even save up to 50% of their onsite labor costs.
"We are one of the few China oilfield services companies which can consistently provide our customers with such a significant reduction on their production costs," added Mr. Yin. "This ability, we believe, will help ensure that Recon will continue to grow its top and bottom lines going forward."
Recon Technology, Ltd. is China's first independent oil and gas field service company listed on NASDAQ (RCON). Closely working with leading global partners, Recon has achieved rapid growth supplying China's largest oil and gas exploration companies, including Sinopec and China National Petroleum Corporation, with advanced automated technologies, efficient gathering and transportation equipment and reservoir stimulation measures. The solutions Recon provides are aimed at increasing gas and petroleum extraction levels, reducing impurities and improving safety and lowering production costs. For additional information, please visit www.recon.cn.
Cautionary Statements
Statements made in this release with respect to Recon's current plans, estimates, strategies and beliefs and other statements that are not historical facts are forward-looking statements about the future performance of Recon. Forward-looking statements include, but are not limited to, those statements using words such as "believe," "expect," "plans," "strategy," "prospects," "forecast," "estimate," "project," "anticipate," "aim," "intend," "seek," "may," "might," "could" or "should," and words of similar meaning in connection with a discussion of future operations, financial performance, events or conditions. These statements are based on management's assumptions, judgments and beliefs in light of the information currently available to it. Recon cautions investors that a number of important risks and uncertainties could cause actual results to differ materially from those discussed in the forward-looking statements, including but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, timing of revenue recognition and other risks contained in reports filed by the company with the Securities and Exchange Commission. Therefore investors should not place undue reliance on such forward-looking statements. Actual results may differ significantly from those set forth in the forward-looking statements.
All such forward-looking statements are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.
Investor Relations Contact:
Jimmy Caplan, Asia IR-PR jimmy@asia-irpr.com (512) 329-9505
Ken Donenfeld, DGI Investor Relations, kdonenfeld@dgiir.com (212) 425-5700
Media Relations Contact:
Rick Eisenberg, Asia IR-PR rick@asia-irpr.com (917) 691-8934
