On February 7, 2018, China Tian Lun Gas Holdings Limited (Stock Code: 1600.HK, “Tian Lun Gas”), China's leading city gas operator, announced that Henan Tian Lun Gas Group Limited (an indirect wholly owned subsidiary of Tian Lun Gas) has acquired 100% equity interest in Mizhi County Changxing Natural Gas Company Limited (“Mizhi Changxing”) and 100% equity interest in Wubu County Changxing Natural Gas Company Limited (“Wubu Changxing”), which are two city gas companies in Yulin, Shaanxi Province. The total consideration for above two acquisitions is RMB177,000,000 (consideration may be adjusted according to asset verification). At present, the transfer of the equity interests and operating rights of the target companies has been completed.

Mizhi Changxing and Wubu Changxing respectively owns the exclusive city gas concession rights in Mizhi County and Wubu County, Yulin, Shaanxi Province in the PRC to provide natural gas to residential, industrial and commercial users in the regions. They in total own 19 kilometers of high-pressure pipelines, 73 kilometers of medium-pressure pipelines and a compressed natural gas refilling station, with a total gas sales volume of approximately 28.73 million cubic meters in 2016.

Shaanxi Province has abundant natural gas resources and is one of the major regions with rich natural gas reserves in the PRC. These acquisitions will bring important strategic values and influence on Tian Lun Gas’s future business expansion in Shaanxi Province, increase of gas sales dollar margin, and further increase in the market share in Northwestern China.

Mizhi Changxing and Wubu Changxing will adopt Tian Lun Gas’s management, procurement, sales, cost control and information technology systems, in order to further enhance their operating efficiency and profitability.