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| A Strategic Move to Diversify Income Streams |
HONG KONG, Oct 29, 2014 - (ACN Newswire) - Phoenitron Holdings Limited ("Phoenitron Holdings" or together with its subsidiaries, "the Group") (Stock Code: 8066) through its indirect non-wholly-owned subsidiary, Shanghai Phoenitron Petroleum & Chemical Company Limited ("Shanghai Phoenitron"), has signed a non-legally binding Letter of Intent with Jiangsu Huagang Gas Company Limited ("Jiangsu Huagang"), a company indirectly controlled by Kunlun Energy Company Limited ("Kunlun Energy") (stock code: 00135) for collaboration in certain areas in the Yangtze River Delta economic zone in the PRC. The cooperation may involve, including but not limited to those areas such as the supply of liquefied natural gas ("LNG"), capital, professional techniques and the promotion of relations with local governments and customers.
The Letter of Intent is to be valid for a term of three years and renewable upon expiry by mutual agreement of Shanghai Phoenitron and Jiangsu Huagang. According to the Letter of Intent, it has been agreed, among other things, that:
1. Jiangsu Huagang is to leverage its advantages over its stable source of LNG from PetroChina Company Limited, as well as its own capital resources and technical expertise. Shanghai Phoenitron for its part is to utilise its established network with local governmental authorities and major customers. Both parties are to co-operate in the development and the establishment of LNG gas stations and the direct supply of LNG to industrial users in the Yangtze River Delta economic zone in the PRC.
2. Jiangsu Huagang is to ensure a stable supply of LNG to Shanghai Phoenitron's development projects, and Shanghai Phoenitron is to be responsible for the local LNG market development and project management and operation;
3. The sourcing of LNG supply for the projects conducted by Shanghai Phoenitron is to be coordinated by Jiangsu Huagang. Individual supply contracts (which cover terms including price, manner of settlement, logistics arrangements and other issues related to co-operation, etc.) and other relevant contracts are to be entered into between Jiangsu Huagang and Shanghai Phoenitron for each development project of Shanghai Phoenitron; and
4. Jiangsu Huagang can provide gas station facilities and technical staff, and is to offer LNG at a discounted price to Shanghai Phoenitron.
Ms. Lily Wu, Chairman and CEO of Phoenitron Holdings, said, "The combined expertise and advantages of the Group and Jiangsu Huagang create a mutually beneficial situation for both parties. The strategic alliance can also make a significant contribution to the promotion of steady and sustainable provision of clean energy in the Yangtze River Delta economic zone, as well as the development of green energy in China. The Group has continued to explore business opportunities. In addition to diversifying its business, it is also striving to develop new markets with strong potential with a focus on China's new energy sector. Therefore, we will advance towards our strategic goal, i.e., for Shanghai Phoenitron to develop more than 50 LNG projects in the Yangtze River Delta economic zone in China by 2019. Along with the expansion of the natural gas business, this partnership is expected to generate additional income for the Group, consolidate its income base and generate more stable returns for our shareholders."
Media Enquiries:
Strategic Financial Relations Limited
Heidi So Tel: 852-2864 4826 Email: heidi.so@sprg.com.hk
Brenda Chan Tel: 852-2864 4833 Email: brenda.chan@sprg.com.hk
Stephanie Liu Tel: 852-2864 4852 Email: stephanie.liu@sprg.com.hk
Fax: 852-2527 1196
Topic: Press release summary
Source: Phoenitron Holdings Limited
Sectors: Daily Finance, Daily News
http://www.acnnewswire.com
From the Asia Corporate News Network
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