Clarifies Mistaken Change to Trading Symbol
BEIJING, Nov. 26 /Xinhua-PRNewswire-FirstCall/ -- Sinoenergy Corporation (OTC Bulletin Board: SNEN), a manufacturer of compressed natural gas (CNG) vehicle and gas station equipment and a designer, developer and operator of CNG filling stations in China, has announced that the Company expects to benefit from the recent increase in natural gas retail prices for vehicle users.
On November 8, 2007, the National Development and Reform Commission in China raised ex-factory natural gas prices for industrial users. However, this price increase does not apply to the wholesale price for CNG for vehicles use, fertilizer manufacture use or residential use. Moreover, the NDRC reiterated that since CNG-powered vehicles have a positive impact on the urban environment, they should have priority in using natural gas.
To encourage the use of CNG-powered vehicles, the National Development and Reform Commission in China recently requested that provincial municipalities increased local CNG retail prices so that they fall between 60% and 75% of the local price for 90 octane gasoline. The adjusted price shall not less than 75% of the price movement of 90 octane gasoline finally. Sinoenergy believes that this policy will improve the profitability for CNG filling station operators and therefore encourage greater investment in the sector.
As a result of the new policies, Hubei province’s municipal government recently raised the retail price for CNG to vehicle users from 40 cents to 45 cents per cubic meter in Hubei province, while at the same time allowing major cities the flexibility to adjust the retail price of CNG used for vehicles in order to promote CNG supply and encourage the use of CNG-powered vehicles in local markets. Wuhan, the capital of Hubei province, where Sinoenergy has two CNG filling stations in operation, implemented this policy on November 19th. The two stations now are selling CNG to vehicles at 45 cent per cubic meter. Sinoenergy’s management estimates that the increase in the retail price could increase the annualized net income of CNG filling stations. To a CNG filling station selling 10,000 cubic meters of CNG per day, it is expected to add net income of $73,000 per year.
“We are pleased to see the Chinese government’s strong support for CNG vehicles. As a result of these policies, our purchase price for CNG currently remains unchanged, while we have benefited from increasing retail prices at which we sell CNG to vehicle users,” said Mr. Bo Huang, CEO of Sinoenergy Corporation. “We believe the raising retail price for vehicles will aid in encouraging the development of a CNG filling station network throughout mainland China. And we remain confident that our business model will support improving revenues and profitability as Sinoenergy’s new stations comes on line.”
The price at which Sinoenergy purchases and sells CNG are both subject to price controls.
Trading Symbol Corrected
The Company also reported that its trading symbol had been mistakenly changed from SNEN to SNENE for two days this week due to a clerical error by NASDAQ. As previously reported and disclosed in an 8-K filing, Sinoenergy changed its fiscal year to end on Sept 30th and therefore is required to report its audited financial results for the period ended September 30th, 2007 by December 31, 2007. The Company was not delinquent in its filing obligations and NASDAQ has subsequently corrected its error in changing the trading symbol.
About Sinoenergy
Sinoenergy is a manufacturer of compressed natural gas (CNG) vehicle and gas station equipment as well as an operator of CNG stations in China. In addition to its CNG related products, the Company also manufactures a wide variety of pressure containers for use in different industries, including the design and manufacture of various types of pressure containers in the petroleum and chemical industries, the metallurgy and electricity generation industries and the food and brewery industries.
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, future changes in the wholesale and retail price for CNG for vehicles in China; changes in policy by the national, provincial and municipal government of the PRC regarding CNG prices, the CNG vehicle industry, and related issues; the Company’s ability to raise additional capital to finance the Company’s activities; the effectiveness, profitability, and the marketability of its products; 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; the Company’s ability to protect its proprietary information; general economic and business conditions; the volatility of the Company’s operating results and financial condition; the Company’s ability to attract or retain qualified senior management personnel and research and development staff; 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. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or to changes in its expectations, except as may be required by law. 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.
For more information, please contact:
Sinoenergy Corporation
Ms. Laby Wu, CFO
Tel: +86-10-8492-8149
Email: labywu@sinoenergycorporation.com
CCG Elite Investor Relations Inc.
Mr. Crocker Coulson, President
Tel: +1-646-213-1915 (New York)
Email: crocker.coulson@ccgir.com
