Shaanxi Province Doubled the Investment in Supporting Company's LNG Initiative with Funding for Electrical Station
NEW YORK, Aug. 17 /PRNewswire-Asia/ -- China Natural Gas, Inc. ("China Natural Gas" or the "Company") (Nasdaq: CHNG), a leading provider of compressed natural gas (CNG) for vehicular fuel and pipeline natural gas for industrial, commercial and residential use in Xi'an, China, today announced the updates for the power supply agreement with Yulin Municipal Government and Shaanxi Provincial Government.
As mentioned in the previous press release on March 25th, 2009, China Natural Gas has reached a power supply agreement with the municipal government of Yulin and Shaanxi Provincial Government. In this latest agreement, Yulin Electric Power Supply Bureau offers to invest RMB40 million (approximately US$5.9 million), which doubled the amount of its previously promised funding, to build an integrated 110KV transformer substation to ensure the supply of electricity for the Company's LNG plant. The commitment letter from Yulin Electric Power Supply Bureau states that because China Natural Gas's LNG initiatives are important at both provincial and municipal levels, the Bureau has made decision to add more investment in this built-out to guarantee to stability and capacity of the electricity demand for this key project.
Mr. Qinan Ji, Chairman and CEO of China Natural Gas commented, "We are very glad to be informed this news by the Yulin government, and very delighted to share with our investors with this update. This doubled investment from the local government to build power facilitates for China Natural Gas demonstrates the government's continued support in implementing our LNG project. Having established a long-trusted safety record, with dominant market leading position, strong brand and broad market coverage, China Natural Gas has been recognized by the local government as a key player in the development of local economy too. More importantly, this RMB 40 million investment will further save our cost in building such transformer substation, which provides us with more financial flexibility in the future."
Mr. Ji continued, "We have received much positive news from the government in supporting the natural gas industry. Currently, the pricing mechanism of natural gas in China is influenced more by government policies than market forces. In early August, research from the State Information Center indicated that natural gas prices would soon be raised. And, because the price of natural gas in China is currently much lower than that of the international market, it is reasonable to estimate that the Chinese government is preparing to raise natural gas prices closer in line with global prices. We are confident that with the strong support from the government, we will continue our commitment to grow our business toward our goal of becoming the leader in China's fast growing natural gas market and we are excited about our ability to deliver sustained, strong financial results and to ultimately reward our supportive shareholders with greater share value."
About China Natural Gas, Inc.
The Company transports, distributes and sells natural gas to commercial, industrial and residential customers through its natural gas pipeline networks in China's Xi'an area, including Lantian County and the districts of Lintong and Baqiao, in Shaanxi Province. The Company owns approximately 120 km of high pressure pipelines in Xi'an, Shaanxi Province and, as of March 31, 2009, operates 23 CNG fuelling stations in Shaanxi Province and 12 CNG fuelling stations in Henan Province.
The Company's four primary business lines include: (1) the distribution and sale of CNG through Company-owned/leased CNG fuelling stations for hybrid (natural gas/gasoline) powered vehicles; (2) the installation, distribution and sale of piped natural gas to residential, commercial and industrial customers through Company-owned pipelines; (3) the distribution and sale of gasoline through Company-owned/leased CNG fuelling stations for hybrid (natural gas/gasoline) powered vehicles; and (4) the conversion of gasoline-fuelled vehicles to hybrid (natural gas/gasoline) powered vehicles through its auto conversion division.
SAFE HARBOR: FORWARD-LOOKING STATEMENTS
This press release includes statements that may constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. For example, statements about the future plans and goals of the JV with CNPC and its prospects are forward looking and subject to risks. China Natural Gas, Inc. may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission on forms 10-K, 10-Q and 8-K, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, risks outlined in the Company's filings with the U.S. Securities and Exchange Commission, including its registration statements on Forms S-1 and S-3, in each case as amended. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
This release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. Any public offering of securities to be made in the United States will be made by means of a prospectus that may be obtained from the issuer or selling security holder and that will contain detailed information about the company and management, as well as financial statements.
For more information, please contact:
China Natural Gas Inc.
Jacky Shi
IR Director
Tel: +86-29-8832-3325 x922
Cell: +86 139-9287-9998
Email: yjshi@naturalgaschina.com
ICR, Inc.
Michael Tieu
Tel: +86-10-6599-7960
Email: Michael.Tieu@icrinc.com
