China Literature Limited — Proxy Solicitation & Information Statement 2012

Jul 31, 2012

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult a licensed securities dealer or registered institution in securities, a bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in China Gas Holdings Limited (the “ Company ”), you should at once hand this circular and the accompanying proxy form to the purchaser or the transferee or to the licensed securities dealer or registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Hong Kong Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

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CHINA GAS HOLDINGS LIMITED 中國燃氣控股有限公司 [*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 384)

DISCLOSEABLE TRANSACTION AND FRUSTRATING ACTION

ACQUISITION OF REMAINING 51% OF THE ISSUED SHARES IN PANVA GAS HOLDINGS LIMITED PURSUANT TO THE EXERCISE OF A CALL OPTION GRANTED UNDER THE SUPPLEMENTAL AGREEMENTS

AND

NOTICE OF SPECIAL GENERAL MEETING

A notice of the SGM to be held at Grand Hyatt Hong Kong, Drawing Room, Mezzanine Floor, 1 Harbour Road, Hong Kong on Thursday, 16 August 2012 at 11:00 a.m. or immediately after the conclusion of the annual general meeting of the Company which is scheduled to be held on the same date and at the same venue at 10:00 a.m. is set out on page 13 to page 14 of this circular. A form of proxy for use by the Shareholders at the meeting is enclosed with this circular. Whether or not you intend to attend and vote at the SGM in person, you are requested to complete the form of proxy enclosed with this circular in accordance with the instructions printed thereon and return it to the Company’s branch share registrar, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong as soon as practicable but in any event not later than 48 hours before the time appointed for holding the SGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the SGM should you so wish and in such event, the instrument appointing a proxy shall be deemed to be revoked.

31 July 2012

• For identification purposes only

CONTENTS

	Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
NOTICE OF SPECIAL GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13

• i -

DEFINITIONS

In this circular, the following words and expressions shall, unless the context otherwise requires, have the following respective meanings:

• “49% Agreement”

the equity transfer agreement dated 10 March 2011 entered into between the Purchaser and the Vendors, as supplemented by the Supplemental Agreements, in relation to the sale and purchase of 49% of the issued shares of the Target

• “51% Agreement” the agreement dated 27 July 2012 entered into between the Purchaser and the Vendors for the sale and purchase of the Sale Shares

• “51% Transaction” the acquisition of the Sale Shares under the 51% Agreement

• “Board” the board of Directors

• “Call Option” an option granted to the Purchaser to acquire the Sale Shares held by the Vendors pursuant to the Supplemental Agreements

• “Company” China Gas Holdings Limited, a company incorporated in Bermuda with limited liability and the issued shares of which are listed on the main board of The Stock Exchange of Hong Kong Limited (stock code: 384)

• “Completion” the completion of the 51% Transaction

• “Completion Date” a day falling within five business days after fulfilment of all Conditions Precedent, or such other day as agreed by the parties to the 51% Agreement

• “Conditions Precedent” the conditions precedent of the 51% Transaction which are set out in the paragraph headed “Letter from the Board – The 51% Agreement – Conditions Precedent” of this circular

• “Directors” the directors of the Company

• “Elite First” Elite First Ltd., a company incorporated in the British Virgin Islands

• “Executive” the Executive Director of the Corporate Finance Division of the Hong Kong Securities and Futures Commission or any delegate of the Executive Director

• “First Supplemental Agreement”

• the supplemental agreement to the 49% Agreement dated 4 June 2011 entered into between the Purchaser and the Vendors

• “Group”

the Company and its subsidiaries

• 1 -

DEFINITIONS

“Hong Kong”	The Hong Kong Special Administrative Region of the People’s
	Republic of China
“Joint Account”	the bank account to be opened by the Purchaser and the Vendors not
	less than five business days prior to the Completion Date, or such
	other time agreed by the Purchaser and the Vendors
“Latest Practicable Date”	27 July 2012, being the latest practicable date prior to the printing
	of this circular for ascertaining certain information contained herein
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock
	Exchange of Hong Kong Limited
“Long Stop Date”	31 December 2012
“LPG”	liquefied petroleum gas
“Magic Strength”	Magic Strength Holdings Ltd., a company incorporated in the
	British Virgin Islands
“Panva Industrial”	Panva Industrial Gas Investments Limited 百江工業氣體投資有限
	公司, a company incorporated in Hong Kong with limited liability,
	a wholly-owned subsidiary of the Target
“Panva Investment”	Panva Investment Limited, a company incorporated in Hong Kong
	with limited liability, a wholly-owned subsidiary of Panva LPG
“Panva LPG”	Panva LPG Investment Holdings Limited 百江液化氣投資有限公
	司, a company incorporated in the British Virgin Islands with
	limited liability, a wholly-owned subsidiary of the Target
“PRC”	The People’s Republic of China
“Purchaser”	Energy Link Investments Ltd., a company incorporated in Hong
	Kong and a wholly-owned subsidiary of the Company
“Sale Shares”	51% of the issued shares of the Target
“Second Supplemental Deed”	the supplemental deed to the 49% Agreement dated 29 May 2012
	entered into between the Purchaser and the Vendors
“SFO”	the Securities and Futures Ordinance (Chapter 571 of the Laws of
	Hong Kong)
“Share(s)”	the ordinary share(s) of HK$0.01 each in the share capital of the
	Company

• 2 -

DEFINITIONS

“Shareholder” the holders of the Shares “Special General Meeting” or the special general meeting of the Company to be held at Grand “SGM” Hyatt Hong Kong, Drawing Room, Mezzanine Floor, 1 Harbour Road, Hong Kong on Thursday, 16 August 2012 at 11:00 a.m. or immediately after the conclusion of the annual general meeting of the Company which is scheduled to be held on the same date and at the same venue at 10:00 a.m. or at any adjournment thereof “Stock Exchange” The Stock Exchange of Hong Kong Limited “Supplemental Agreements” the First Supplemental Agreement and the Second Supplemental Deed “Takeovers Code” Hong Kong Code on Takeovers and Mergers “Target” Panva Gas Holdings Limited 百江氣體控股有限公司, a company incorporated in the British Virgin Islands with limited liability “Vendors” Magic Strength, Wealth Elite and Elite First “Wealth Elite” Wealth Elite Holdings Ltd., a company incorporated in the British Virgin Islands

• 3 -

LETTER FROM THE BOARD

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CHINA GAS HOLDINGS LIMITED 中國燃氣控股有限公司 [*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 384)

Executive Directors:

Mr. LEUNG Wing Cheong, Eric (Joint Managing Director) Mr. PANG Yingxue (Joint Managing Director) Mr. ZHU Weiwei Mr. MA Jinlong

Registered Office: Clarendon House 2 Church Street Hamilton HM 11 Bermuda

Non-executive Directors: Mr. FENG Zhuozhi Mr. Jo YAMAGATA Mr. P K JAIN Mr. MOON Duk Kyu Mr. KIM Yong Joong (alternate to Mr. MOON Duk Kyu) Mr. Mulham AL-JARF

Head office and principal place of business in Hong Kong: 16th Floor AXA Centre 151 Gloucester Road Wanchai Hong Kong

Mr. Mark D. GELINAS (alternate to Mr. Mulham AL-JARF)

Independent non-executive Directors:

Mr. ZHAO Yuhua

Dr. MAO Erwan

Ms. WONG Sin Yue, Cynthia (Chairperson)

31 July 2012

To the Shareholders,

Dear Sir or Madam,

DISCLOSEABLE TRANSACTION AND FRUSTRATING ACTION

ACQUISITION OF REMAINING 51% OF THE ISSUED SHARES IN PANVA GAS HOLDINGS LIMITED PURSUANT TO THE EXERCISE OF A CALL OPTION GRANTED UNDER THE SUPPLEMENTAL AGREEMENTS

AND

NOTICE OF SPECIAL GENERAL MEETING

INTRODUCTION

The purpose of this circular is to give you information regarding the resolution relating to the 51% Agreement dated 27 July 2012 entered into between the Purchaser and the Vendors to be proposed at the SGM to enable the Shareholders to make an informed decision on whether to vote for or against the resolution.

• For identification purposes only

• 4 -

LETTER FROM THE BOARD

Reference is made to the announcements of the Company dated 10 March 2011 and 6 June 2011 in relation to the 49% Agreement, pursuant to which the Purchaser had acquired from the Vendors 49% of the issued shares of the Target for a total cash consideration of HK$259,700,000 and the Vendors granted the Call Option to the Purchaser. Reference is also made to the announcement of the Company dated 29 May 2012 in relation to the Second Supplemental Deed pursuant to which the exercise period of the Call Option has been extended to 30 September 2012.

THE 51% AGREEMENT

The Board is pleased to announce that on 27 July 2012, the Purchaser entered into the 51% Agreement with the Vendors pursuant to which the Purchaser has conditionally agreed to purchase and the Vendors have conditionally agreed to sell the remaining 51% of the issued share capital of the Target for a total cash consideration of HK$270,300,000. Upon completion of the 51% Transaction, the Target will become a wholly-owned subsidiary of the Company and its financial information will be consolidated into the Group’s.

Assets to be acquired

The Sale Shares, representing 51% of the issued shares of the Target as at the Latest Practicable Date, consist of 18,586 issued shares of the Target held by Magic Strength, 26,746 issued shares of the Target held by Wealth Elite and 11,333 issued shares of the Target held by Elite First. The Sale Shares and all the interests attached thereto will be transferred to the Purchaser upon Completion.

Upon Completion, the Target will become a wholly-owned subsidiary of the Company.

Consideration

The consideration for the Sale Shares is HK$270,300,000, which is payable by the Purchaser in cash on the Completion Date in the following manner:

• (a) HK$30,000,000 to be paid to the Joint Account; and

• (b) HK$240,300,000 to be paid to a bank account jointly designated by the Vendors.

The consideration will be paid by the Company by using internal resources. The consideration was agreed between the Purchaser and the Vendors after arm’s length negotiations taking into account net asset value of the Target and its affiliated companies when the Purchaser and the Vendors entered into the 49% Agreement. The Directors (including the independent non-executive Directors) consider that the terms and conditions of the 51% Agreement are fair and reasonable and are in the interests of the Company and the shareholders of the Company as a whole.

• 5 -

LETTER FROM THE BOARD

Conditions Precedent

Completion of the 51% Transaction is conditional upon, among others:

• (a) all parties having obtained all governmental approvals, consents, permits, registration and filing for records (including but not limited to anti-trust approval) which are necessary for the 51% Agreement and the transactions contemplated thereunder, and each such approval, consent, permit, registration and filing for records having remained in full force and effect;

• (b) there having been no material adverse change to the Target and its affiliated companies since the date of signing the 51% Agreement;

• (c) the representations and warranties provided by each Vendor in the 51% Agreement remaining true and accurate as at Completion;

• (d) there being no order issued by any competent court or regulatory authority which would restrict or prohibit any transaction contemplated under the 51% Agreement or render any such transaction void, and there being no promulgated or enacted law, rule, regulation or other requirement which would restrict or prohibit any transaction contemplated under the 51% Agreement or render any such transaction void;

• (e) there being no pending or threatened litigation or other proceedings which might prohibit or restrict the 51% Transaction or might render the 51% Transaction void or which is otherwise related to the 51% Transaction; and

• (f) the Shareholders at the SGM approving, among other things, the 51% Agreement and the transactions contemplated thereunder.

Completion

Completion will take place within five business days after fulfilment of all the Conditions Precedent. If any of the Conditions Precedent has not been satisfied or waived on or before the Long Stop Date, unless Completion is extended by agreement between the Purchaser and the Vendors in writing, the 51% Agreement shall terminate.

Profits sharing

The profits of the Target shall be shared by the Purchaser and the Vendors in the following manner:

• (a) the profits of the Target accrued for the 6 months ended 30 June 2011 (as audited by the auditors of the Target) shall be shared by the Vendors according to their proportion of shareholding interests in the Target before completion of the 49% Agreement;

• (b) the profits of the Target accrued from 1 July 2011 to the Completion Date (as audited by the auditors of the Target) shall be shared by the Purchaser and the Vendors according to their proportion of shareholding interests in the Target as at the date of the 51% Agreement; and

• 6 -

LETTER FROM THE BOARD

• (c) the profits of the Target accrued after Completion shall only be distributed to the Purchaser.

Undertaking by the Vendors

The Vendors have jointly and severally irrevocably undertaken to the Purchaser that the net profit (after deducting all taxation and extraordinary items and excluding any gain or loss from the valuation of assets of the Target and after discussion, adjustment and confirmation by the Purchaser and the Vendors) of the Target and its affiliated companies for the year ended 31 December 2012, as showed in the audited financial statements for the year ended 31 December 2012 prepared in accordance with the Hong Kong Financial Reporting Standards, shall not be less than HK$60,000,000.

If the actual profit of the Target and its affiliate companies is less than HK$60,000,000, the shortfall (the “ Shortfall ”) shall be compensated by the Vendors to the Purchaser, in the following manner:

• (a) the Vendors shall not receive their share of the profits of the Target and its affiliated companies accrued up to 31 December 2011 up to the amount of the Shortfall; and

• (b) if the Shortfall cannot be covered in full by the compensation made in accordance with (a) above, the difference shall be deducted from the amounts retained in the Joint Account.

The liabilities of the Vendors for the above undertaking shall be limited to the compensation made in the manner set out in (a) and (b) above.

• 7 -

LETTER FROM THE BOARD

SHAREHOLDING STRUCTURE OF THE TARGET

Set out below is the shareholding structure of the Target (a) as at the Latest Practicable Date; and (b) immediately following the Completion:

(a) Shareholding structure of the Target as at the Latest Practicable Date

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The Purchaser Magic Strength Wealth Elite Elite First
49% 16.73% 24.07% 10.20%
The Target
100% 100%
Panva LPG Panva Industrial
100%
Panva Investment
PRC subsidiaries and
affiliated companies
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(b) Shareholding structure of the Target immediately following Completion

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The Purchaser
100%
The Target
100% 100%
Panva LPG Panva Industrial
100%
Panva Investment
PRC subsidiaries and
affiliated companies
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• 8 -

LETTER FROM THE BOARD

FINANCIAL INFORMATION OF THE TARGET

A summary of the unaudited consolidated financial information of the Target prepared in accordance with the Hong Kong Financial Reporting Standards, as provided by the Vendors, is as follows:

			For the year	For the year
			ended 31	ended 31
			December 2010	December 2011
			HK$ million	HK$ million
Net	profit	before taxation	117.9	109.4
Net	profit	after taxation	87.9	78.3

According to the unaudited financial statements of the Target, the net assets value of the Target, on a consolidated basis, as at 31 December 2011 was approximately HK$461.8 million.

IMPLICATIONS UNDER THE LISTING RULES AND RULE 4 OF THE TAKEOVERS CODE

As the highest applicable percentage ratio (as defined in Rule 14.07 of the Listing Rules) in respect of the 51% Transaction pursuant to the 51% Agreement exceeds 5% but all the percentage ratios are less than 25%, the 51% Transaction constitutes a discloseable transaction for the Company under Chapter 14 of the Listing Rules.

The Company is currently the subject of an unsolicited pre-conditional voluntary cash offer by ENN Energy Holdings Limited and China Petroleum & Chemical Corporation. Under Rule 4 of the Takeovers Code, once a bona fide offer has been communicated to the board of an offeree company or the board of an offeree company has reason to believe that a bona fide offer may be imminent, no action which could effectively result in an offer being frustrated, or in the shareholders of the offeree company being denied an opportunity to decide on the merits of an offer, shall be taken by the board of the offeree company in relation to the affairs of the company without the approval of the shareholders in general meeting. The 51% Transaction comprises an acquisition of assets of a material amount and is therefore a frustrating action of the Company under Rule 4 of the Takeovers Code. The 51% Transaction is therefore subject to the shareholders’ approval requirements under Rule 4 of the Takeovers Code.

In the event that the Company is no longer subject to an offer from the date hereof to the date of the SGM for any reason, the 51% Transaction will cease to be a frustrating action under Rule 4 of the Takeovers Code. In that case, the Company will not convene the SGM to obtain the shareholders’ approval for the 51% Transaction. A further announcement will be made by the Company in this regard as appropriate.

• 9 -

LETTER FROM THE BOARD

REASONS FOR EXERCISING THE CALL OPTION AND ENTERING INTO THE 51% AGREEMENT

Since the Target and its affiliated companies are principally engaged in terminal retail business of LPG in the PRC and the Group is principally engaged in the wholesale of LPG, the Board considers that exercising the Call Option and the 51% Transaction would enable our consolidation of LPG market in the PRC and achieve economies of scale. Furthermore, the Board considers that such vertical integration of business would capture higher market coverage in the PRC.

The 51% Transaction would enable the Group to gain full control of the Target so as to integrate the Target operationally and financially into the Group’s management system, which would further enhance the profitability of the vertically consolidated LPG business of the Group.

In addition, the Board considers that the 51% Transaction could enhance the capital strength and brand value of the Group’s LPG business as the Target and its affiliated companies have good brand recognition in the downstream market while the Group’s LPG wholesale business has good strategic layout and growth potential. The 51% Transaction is expected to provide a strong support to the long-term development and lay down a solid foundation for the sustainable development of the Group’s LPG business.

INFORMATION OF THE GROUP, THE VENDORS AND THE TARGET

The Group

The Group is principally engaged in the investment in, and the operation and management of, gas pipleline infrastructure and the sale and distribution of gas in the PRC.

Magic Strength

Magic Strength is a company incorporated in the British Virgin Islands with limited liability and is principally engaged in investment holding. As at the Latest Practicable Date, the entire issued share capital of Magic Strength is held by Mr. Ou Yaping.

Wealth Elite

Wealth Elite is a company incorporated in the British Virgin Islands with limited liability and is principally engaged in investment holding. As at the Latest Practicable Date, the entire issued share capital of Wealth Elite is held as to 69.49% by Mr. Chen Wei, 8.47% by Mr. Tang Yui Man Francis, 8.47% by Mr. Shen Lianjin, 3.39% by Mr. Li Fujun, 3.39% by Mr. Zhang Keyu, 3.39% by Ms. Huang Jie and 3.39% by Mr. Li Feng.

Elite First

Elite First is a company incorporated in the British Virgin Islands with limited liability and is principally engaged in investment holding. As at the Latest Practicable Date, the entire issued share capital of Elite First is held as to 50% by Mr. Chen Wei and 50% by Mr. Shen Lianjin.

• 10 -

LETTER FROM THE BOARD

To the best of the Directors’ knowledge, information and belief having made all reasonable enquiry, save for the Vendors’ respective equity interests in the Target before completion of the 51% Transaction, the Vendors and their respective ultimate beneficial owners are third parties independent of the Company and its connected persons.

The Target

The Target is an investment holding company incorporated in the British Virgin Islands with limited liability and its entire issued share capital is currently owned by the Purchaser, Magic Strength, Wealth Elite and Elite First as to 49%, 16.73%, 24.07% and 10.20% respectively. For further details of the shareholding structure of the Target, please refer to the paragraph headed “Shareholding Structure of the Target” above.

The Target and its subsidiaries are principally engaged in terminal retail business of LPG in the PRC. Its major assets and businesses include a national customer service phone number of 95007, and approximately 450 self-owned retail stores and approximately 120 franchised outlets which are located in provinces such as Jiangsu, Hubei and Zhejiang.

SPECIAL GENERAL MEETING

A notice of the SGM is set out on pages 13 to 14 of this circular.

A form of proxy for use at the SGM is enclosed herewith. To be valid, the form of proxy must be completed in accordance with the instructions printed thereon and deposited, together with the power of attorney or other authority (if any) under which it is signed or a notarially certified copy of such power of attorney or authority at the Company’s branch share registrar in Hong Kong, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong not less than 48 hours before the time appointed for holding the SGM or any adjournment thereof. Completion and delivery of the form of proxy will not preclude you from attending and voting in person at the SGM should you so wish and in such event, the instrument appointing a proxy shall be deemed to be revoked.

VOTING BY WAY OF POLL

Pursuant to Rule 13.39(4) of the Listing Rules, all votes of Shareholders at the SGM will be taken by poll and the Company will announce the results of the poll in the manner prescribed under Rule 13.39(5) of the Listing Rules.

RECOMMENDATION

The Directors are of the opinion that the resolution to be proposed at the SGM as referred in this circular are in the best interests of the Company and the Shareholders as a whole and recommend you to vote in favour of the relevant ordinary resolution to be proposed at the SGM.

• 11 -

LETTER FROM THE BOARD

RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors jointly and severally accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in this circular have been arrived at after due and careful consideration and there are no other facts not contained in this circular, the omission of which would make any statement herein misleading.

Yours faithfully, On behalf of the Board CHINA GAS HOLDINGS LIMITED LEUNG Wing Cheong, Eric Joint Managing Director

• 12 -

NOTICE OF SPECIAL GENERAL MEETING

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CHINA GAS HOLDINGS LIMITED 中國燃氣控股有限公司 [*]

(Incorporated in Bermuda with limited liability)

(Stock Code: 384)

NOTICE OF SPECIAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that a special general meeting (the “ SGM ”) of China Gas Holdings Limited (the “ Company ”) will be held at Grand Hyatt Hong Kong, Drawing Room, Mezzanine Floor, 1 Harbour Road, Hong Kong on Thursday, 16 August 2012 at 11:00 a.m. or immediately after the conclusion of the annual general meeting of the Company which is scheduled to be held on the same date and at the same venue at 10:00 a.m. for purposes of considering and, if thought fit, passing the following resolution as ordinary resolution. Unless otherwise indicated, capitalized terms used in this notice and the following resolution shall have the same meanings as those defined in the circular of the Company dated 31 July 2012 (the “ Circular ”):

ORDINARY RESOLUTION

“ THAT

• (a) the 51% Agreement (a copy of which has been produced to the SGM marked “A” and signed by the chairman of the SGM for the purpose of identification) and the transactions contemplated thereunder, be and are hereby approved, confirmed and ratified; and

• (b) any one or more of the Directors be and is/are hereby authorised to do all such acts and things and execute all such documents which he/they consider necessary, desirable or expedient for the purpose of, or in connection with, the implementation of and giving effect to the 51% Agreement and the transactions contemplated thereunder.”

By Order of the Board of CHINA GAS HOLDINGS LIMITED LI Man Kit

Company Secretary

Hong Kong, 31 July 2012

* For identification purposes only

• 13 -

NOTICE OF SPECIAL GENERAL MEETING

Principal Place of Business in Hong Kong:

16th Floor AXA Centre 151 Gloucester Road Wan Chai Hong Kong

Registered office: Clarendon House 2 Church Street Hamilton HM11 Bermuda

Notes:

1. Any member entitled to attend and vote at the SGM is entitled to appoint one or, if he is a holder of more than one Share, more proxies to attend and vote instead of him. A proxy need not be a member of the Company.

2. A form of proxy for use in connection with the SGM is enclosed with the Circular. To be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed or a notarially certified copy of that power of attorney or authority must be deposited at the Company’s branch share registrar, Computershare Hong Kong Investor Services Limited, 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong not less than 48 hours before the time appointed for holding the meeting.

3. The register of members of the Company will be closed from 10 August 2012 (Friday) to 16 August 2012 (Thursday) (both days inclusive), during which period no transfer of shares in the Company will be registered, for the purpose of determining the identity of the shareholders entitled to attend and vote at the SGM. In order to qualify for attending and voting at the SGM to be held on 16 August 2012 (Thursday), all transfers of Shares accompanied by the relevant share certificates and transfer forms, must be lodged with the Company’s branch share registrar and transfer office of the Company in Hong Kong, Computershare Hong Kong Investor Services Limited at Shops 1712-16, 17 Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not later than 4:30 p.m. on 9 August 2012 (Thursday).

4. Where there are joint holders of any Shares, any one of such joint holders may vote at the meeting personally or by proxy in respect of such shares as if he was solely entitled thereto provided that if more than one of such joint holders be present at the meeting personally or by proxy, the person whose name stands first on the register of members of the Company in respect of such Shares shall alone be entitled to vote in respect thereof.

5. The Company is currently subject to an unsolicited pre-conditional voluntary cash offer by ENN Energy Holdings Limited and China Petroleum & Chemical Corporation.

6. As at the date of this notice, Mr. LEUNG Wing Cheong, Eric, Mr. PANG Yingxue, Mr. ZHU Weiwei and Mr. MA Jinlong are the executive Directors, Mr. FENG Zhuozhi, Mr. Jo YAMAGATA, Mr. P K JAIN, Mr. MOON Duk Kyu (his alternate is Mr. KIM Yong Joong) and Mr. Mulham AL-JARF (his alternate is Mr. Mark D. GELINAS) are the nonexecutive Directors and Mr. ZHAO Yuhua, Dr. MAO Erwan and Ms. WONG Sin Yue, Cynthia are the independent nonexecutive Directors.

7. 14 -