omniture

Sino Gas International Holdings, Inc. Establishes New Subsidiary in Northeastern China

BEIJING, July 24 /Xinhua-PRNewswire-FirstCall/ -- Sino Gas International Holdings, Inc. (OTC Bulletin Board: SGAS.OB) ("Sino Gas", the "Company") and its subsidiary Beijing Zhong Ran Wei Ye Gas Co., Ltd. ("Beijing Gas") announced the establishment of Baishan Zhong Ran We Ye Gas Co., Ltd. ("Baishan Gas") and the acquisition of all of the operating assets of Baishan Gas Co., Ltd. ("Baishan"), a privately held natural gas distribution business, in Jilin Province of China on July 9, 2007 for approximately $5.0 million in cash and assumed debt.

Sino Gas, through Beijing Gas, signed an agreement with Baishan municipal government in Jilin Province to form the new subsidiary company, effective July 12, 2007. The new company was granted a 30-year exclusive gas operation license by the Baishan municipal government. With registered capital at $2.0 million, the new company used $921,000 to purchase all the operating assets of Baishan. Beijing Gas is also responsible for paying the outstanding debts of Baishan, which total $4.0 million. In total, Beijing Gas acquired the operations of Baishan for a purchase price of approximately $5.0 million, which will be paid in cash installments beginning in 2007, the majority of which is due in December 2030.

Baishan Gas will be a regional natural gas distributor and a developer of gas distribution networks in Jilin Province. The new company's current distribution network includes 8,000 connected households and one gas station. The Company estimates a total of 30,000 households will be connected in the next three years, with 6,000 households connected in 2007, 10,000 households in 2008 and 14,000 households in 2009. In terms of revenues, the Company expects to generate $9.0 million from connection fees and $5.0 million from recurring gas sales over the three-year period.

"We are extremely happy to announce this new addition to our growing portfolio of subsidiary companies," commented Mr. Yu-chuan Liu, Chairman, CEO and President of Sino Gas. "The size of Baishan Gas will greatly boost our revenues and net income. In particular, this acquisition signifies the expansion of our distribution network in the Northeastern region of China, which reinforces our capabilities as we strive to become a leading distributor of natural gas in China."

About Sino Gas International Holdings, Inc.

The Company, through its indirectly wholly-owned subsidiary, Beijing Zhong Ran Wei Ye Gas Co., Ltd. ("Beijing Gas"), and the subsidiaries of Beijing Gas, is a leading developer of natural gas distribution systems in small- and medium-sized cities in China, as well as a distributor of natural gas to residential, commercial and industrial customers in China. The company owns and operates 25 natural gas distribution systems serving approximately 75,000 residential and six commercial and industrial customers. Facilities include over 700 kilometers ("km") of pipeline and delivery networks with a daily capacity of approximately 70,000 cubic meters of natural gas. The company is currently constructing four additional natural gas distribution systems, and it has two more in the planning stages. Beijing Gas owns and operates natural gas distribution systems primarily in Hebei, Jiangsu, Anhui and Shandong Provinces. For further information, visit the Company's website at http://www.sino-gas.com .

Safe Harbor Statement

This announcement contains "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact in this announcement are forward-looking statements, including but not limited to, the Company's ability to raise additional capital to finance the Company's activities; the effectiveness, profitability, and the marketability of its products; legal and regulatory risks associated with the Share Exchange; the future trading of the common stock of the Company; the ability of the Company to operate as a public company; the period of time for which its current liquidity will enable the Company to fund its operations; general economic and business conditions; the volatility of the Company's operating results and financial condition; and other risks detailed in the company's filings with the Securities and Exchange Commission. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the companies and the industry. Although the company believes that the expectations expressed in these forward looking statements are reasonable, they cannot assure you that their expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results.

All information in this release is as of July 24, 2007. The Company undertakes no duty to update any forward-looking statements to conform the release to actual results or changes in its circumstances or expectations after the date of this release.

For more information, please contact:

Sino Gas International Holdings, Inc.

Ms. Fang Chen, Chief Financial Officer

Tel: +86-10-8260-0527

Email: chenfang@sino-gas.com

CCG Elite Investor Relations

Crocker Coulson, President

Tel: +1-646-213-1915/1914 (New York)

Email: crocker.coulson@ccgir.com

Source: Sino Gas International Holdings, Inc.
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Keywords: Oil/Energy
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