ENM Holdings Limited — Proxy Solicitation & Information Statement 2007

May 11, 2007

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 stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in South Sea Petroleum Holdings Limited or both, you should at once hand this circular together with the enclosed form of proxy (for Shareholders only) to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

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

SOUTH SEA PETROLEUM HOLDINGS LIMITED

(Incorporated in Hong Kong with limited liability)

(Stock Code: 076)

DISCLOSEABLE TRANSACTION

Establishment of a Joint Venture

8 May 2007

CONTENTS

		Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		1
Letter from the Board
1.	Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2
2.	The JV Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2
3.	Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
4.	The JVC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
5.	Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
6.	Reasons for the JV Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
7.	Funding of the JVC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
8.	Information of the Group. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Appendix – General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		5

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DEFINITIONS

“Company”	South Sea Petroleum Holdings Limited, a company	South Sea Petroleum Holdings Limited, a company
	incorporated in	Hong Kong with limited liability and the
	securities of which are listed on the Stock Exchange
“Directors”	the board of directors of the Company
“Global Select”	Global Select Limited, a wholly owned subsidiary of the
	Company
“Group”	the Company and its subsidiaries
“JV Agreement”	a joint venture	agreement of 16 April 2007 entered into
	between Global	Select and the Partner
“JVC”	a joint venture	company to be established by Global
	Select and the Partner
“Land”	the piece of land located at Szechuan, PRC (
		), consisting of 2.89 km2
“Latest Practicable Date”	7 May 2007
“Listing Rules”	Rules Governing the Listing of Securities on the Stock
	Exchange
“Partner”	New Fortress Capital Limited, a company incorporated in
	the British Virgin Islands, and Hara Intelligence Systems
	Co. Limited, a company incorporated in Samoa
“PRC Company”	Chengdu An Xiao Mining Company Limited ( ), a company incorporated in the
	People’s Republic of China
“RMB”	Renminbi (	), the legal currency of the PRC
“Shareholder(s)”	holder(s) of the existing shares of the Company
“Stock Exchange”	the Stock Exchange of Hong Kong Limited

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LETTER FROM THE BOARD

SOUTH SEA PETROLEUM HOLDINGS LIMITED

(Incorporated in Hong Kong with limited liability)

(Stock Code: 076)

Executive Directors: Mr. Zhou Ling (Chairman) Ms. Lee Sin Pyung (Managing Director) Ms. Sit Mei

Registered Office: Unit 6605, 66/F., The Center 99 Queen’s Road Central Hong Kong

Independent Non-Executive Directors:

Mr. Lu Ren Jie Mr. Chai Woon Chew Mr. Ho Choi Chiu

8 May 2007

To the Shareholders

Dear Sir or Madam,

1. INTRODUCTION

On 17 April 2007, the Directors announced that Global Select, a wholly owned subsidiary of the Company, had entered into a JV Agreement with the Partner to set up a joint venture company in Hong Kong. The purpose of this document is to give you information relating to the JV Agreement.

2. THE JV AGREEMENT

Date: 16 April 2007

Parties: Global Select and the Partner (together, the “Parties”)

• (a) Global Select, a wholly owned subsidiary of the Company.

• (b) The Partner, with major business in investing in mining industry.

The Company confirms that, to the best of the Directors’ knowledge, information and belief having made all reasonable enquiries, the Partner and its ultimate beneficial owner(s) are third parties independent of the Company and its subsidiaries and connected person (as defined under the Listing Rules) of the Company.

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LETTER FROM THE BOARD

3. BACKGROUND

The PRC Company (the PRC Company and its ultimate beneficial owner(s) are third parties independent of the Company and its subsidiaries and connected person (as defined under the Listing Rules) of the Company) is a company established in the People’s Republic of China to conduct the exploration, mining and exploitation of minerals on or under the Land located at Szechuan, the PRC ( ), consisting of 2.89km[2] , wherein mines of multi-minerals, such as graphite, copper, zinc, are found.

The purpose of setting up the JVC is for acquiring 100% the registered capital, equity and rights of the PRC Company at a purchase price not exceeding HK$100 million, provided that the exploration and mining rights in respect of the Land vested in the PRC Company has a valuation of no less than RMB5 billion. The total capital contribution of HK$100 million is determined by Global Select and the Partner with reference to the maximum expected purchase price of the PRC Company.

The formation of the JVC is conditional on completion of the acquisition of the PRC Company. There is not any legally binding agreement or arrangement has been entered into in respect of the acquisition of the interest in the PRC Company by the JVC. The Company will comply with all the relevant requirements upon entering into any such legally binding agreement or arrangement.

4. THE JVC

The new JVC to be established in Hong Kong with Global Select holding 70% and the Partner holding 30% of its share capital. The JVC will be consolidated into the Company’s financial statements as a subsidiary. In this stage, the Directors do not see any material adverse effect on the earning, assets and liabilities on the Group due to the formation of the JVC.

5. CONDITIONS PRECEDENT

• (a) Completion of the due diligence review and Global Select being reasonably satisfied with the results thereof;

• (b) approval from the relevant PRC authorities being obtained for conversion the JVC into a wholly-foreign-owned PRC enterprise;

• (c) approval from the relevant PRC authority to the PRC Company being the grantee of the Land Use Permit Contract being obtained;

• (d) the obtaining of all consents from other third parties which are necessary or desirable in connection with the execution and performance of the JV Agreement and any of the transactions contemplated under the JV Agreement;

• (e) Global Select having obtained a legal opinion issued by a PRC law firm in respect of the legality and validity of the land use rights being transferred to the PRC Company, in such form and substance to the satisfaction of Global Select;

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LETTER FROM THE BOARD

• (f) the Partner, at its own expense, having obtained a valuation report from an internationally recognized reputable appraiser on the value of the mineral contents thereunder the Land at a value of no less than RMB 5 billion.

As at the Latest Practicable Date, the foregoing conditions precedent are in progress and will be expected to be completed before the end of August of 2007. On 30 September 2007 or such other date as the Parties may agree in writing being the long stop date to the JV Agreement.

6. REASONS FOR THE JV AGREEMENT

As a consequence of the worldwide industrialization, long term demand growth for natural minerals will remain strong, especially in PRC and in other developing countries. Since the Partner is familiar with the local government and polices, and the geology department in the mining area, and if a valuation report from an internationally recognized reputable appraiser on the value of the mineral contents under the Land at a value of no less than RMB5 billion, the entering into the JV Agreement will be beneficial to the Company and its Shareholders as a whole.

The Directors (including independent non-executive directors) consider the terms of the Agreement are fair and reasonable and are on normal commercial terms, which are in the interests of the Company and its Shareholders as a whole.

7. FUNDING OF THE JVC

The Company, through Global Select, will contribute HK$70,000,000 to the JVC from its cash reserve. The Parties will contribute for their respective interest in the JVC after the completion of the due diligence before the long stop date.

In the meantime, the Company and the Partner has not any other capital commitment (whether equity, loan or otherwise) including any contractual commitment to subscribe capital in respect of the formation of the JVC and the acquisition of the PRC Company, apart from their contribution of HK$70 million and HK$30 million for their respective interest in the JVC.

8. INFORMATION OF THE GROUP

The principal activities of the Company are investment holding, and through its subsidiaries, the Company develops, explores and produces crude oil in Indonesia and Philippines, and provides electronics manufacturing services in the United Kingdom.

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GENERAL INFORMATION

APPENDIX

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 collectively and individually 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 and belief there are no other facts the omission of which would make any statement contained herein misleading.

DISCLOSURE OF INTERESTS

(a) Disclosure of interests by the Directors

• (i) As at the Latest Practicable Date, the interests of each of the Directors and chief executive of the Company in the shares, underlying shares and debentures of the Company or any of its associated corporation (within the meaning of Part XV of the SFO) which (a) were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which they are taken or deemed to have under such provisions of the SFO), or (b) which were required pursuant to Section 352 of the SFO to be entered in the register maintained by the Company referred to therein, or (c) which were required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Companies were as follows:

Directors’ long positions in the Shares:

				Approximate
				percentage to
	Number of Shares beneficially held			the issued share
	and nature of interest			capital of the
	Directly	Through		Company as at
	beneficially	controlled	Total	the Latest
Name of Director	owned	corporation	shareholding	Practicable Date
Mr. Zhou Ling	–	32,000,000	32,000,000	0.82%

Note: 32,000,000 Shares in the Company are held by Palmsville Equity, Inc, a company solely and beneficially owned by Mr. Zhou Ling, the Chairman of the Company.

• (ii) save as disclosed herein, as at the Latest Practicable Date none of the Directors and the chief executive of the Company had any interest or short positions in the shares or underlying shares or interest in debentures of the Company or its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which they are taken or deemed to have under such provisions of the SFO) or which were required, pursuant

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GENERAL INFORMATION

APPENDIX

to section 352 of the SFO, to be entered in the register referred to therein, or which were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Companies, to be notified to the Company and the Stock Exchange;

• (iii) as at the Latest Practicable Date, none of the Directors had any interest or short positions in the shares or underlying shares which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 2 and 3 of Part XV of the SFO;

• (iv) as at the Latest Practicable Date, none of the Directors is materially interested in any contract or arrangement subsisting which is significant in relation to the business of the Group; and

• (v) as at the Latest Practicable Date, none of the Directors had entered, or proposed to enter into a service contract with any member of the Group which is not determinable by the Group within one year without payment of compensation, other than statutory compensation.

(b) Disclosure of interests by the Substantial Shareholders

• (i) So far as known to the Directors and the chief executive of the Company, as at the Latest Practicable Date, the persons (other than the Directors of chief executive of the Company) having interests or short positions in the Shares and underlying Shares which were notified to the Company and the Stock Exchange pursuant to Divisions 2 and 3 of Part XV of the SFO were as follows:

Shareholders’ long positions in the Shares:

					Approximate
					percentage to
	**Number **	**of Shares beneficially **		held	the issued share
	and nature of interest				capital of the
	Directly	Through			Company as at
	beneficially	controlled		Total	the Latest
Name of Shareholder	owned	corporation	shareholding		Practicable Date
Palmsville Equity, Inc.	–	32,000,000	32,000,000		0.82%

Note: Save as Mr. Zhou Ling, the chairman of the Company, none of the directors of the Company are a director/employee of Palmsville Equity, Inc.

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GENERAL INFORMATION

APPENDIX

• (ii) Save as disclosed above, there was no person known to the Directors or the chief executive of the Company, other than the Directors or the chief executive of the Company, who, as at the Latest Practicable Date was, directly or indirectly, had an interest or a short position in the Shares and underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.

• (iii) As at the Latest Practicable Date, there was no person known to the Directors or the chief executive of the Company, other than the Directors or the chief executive of the Company, who was, directly or indirectly, interested in 10% or more of the nominal value of the issued share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group, or any options in respect of such capital.

DIRECTORS’ INTERESTS IN COMPETING BUSINESS

As at the Latest Practicable Date, none of the directors of the Company (including their respective associates) are considered to have interests in businesses which compete or are likely to compete, either directly or indirectly, with the businesses of the Group pursuant to the Listing Rules.

LITIGATION

Neither the Company nor any of its subsidiaries is engaged in any litigation or arbitration of material importance and, so far as the Directors are aware, no litigation or arbitration of material importance is pending or threatened against the Company or any of its subsidiaries.

GENERAL

• (a) The registered office of the Company is Unit 6605, 66/F., The Center, 99 Queen’s Road Central, Hong Kong

• (b) The secretary of the Company is Ms. Lam Lee Yu, an associate member of The Hong Kong Institute of Chartered Secretaries and The Institute of Chartered Secretaries and Administrators.

• (c) The qualified accountant of the Company is Mr. William Ho, a fellow of Hong Kong Institute of Certified Public Accountants.

• (d) The share registrar and transfer office of the Company is Computershare Hong Kong Investor Services Limited located at 46/F., Hopewell Centre, 183 Queen’s Road East, Hong Kong.

• (e) The English text of this circular shall prevail over the Chinese text.

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