Liaoning Port Co., Ltd. — Proxy Solicitation & Information Statement 2008

Jan 29, 2008

IMPORTANT

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

If you have sold or transferred all your shares in Dalian Port (PDA) Company Limited, you should at once hand this circular together with the accompanying form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale 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 its 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.

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Dalian Port (PDA) Company Limited __ 大連港股份有限公司*

(a sino-foreign joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 2880)

CONTINUING CONNECTED TRANSACTIONS AND

NOTICE OF THE FIRST EXTRAORDINARY GENERAL MEETING IN 2008

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

A letter from the Independent Board Committee to the Independent Shareholders is set out on pages 10 to 11 of this circular.

A letter from Access Capital Limited, the Independent Financial Adviser, containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 12 to 22 of this circular.

A notice convening the extraordinary general meeting of the shareholders of Dalian Port (PDA) Company Limited to be held at Room 602, PDA Group Building, No. 1 Gangwan Street, Zhongshan District, Dalian City, Liaoning Province, PRC at 10:00 a.m. on 20 March 2008 is set out in Appendix 2 of this circular.

A form of proxy and a reply slip for use in connection with the extraordinary general meeting are enclosed herewith and published on the website of the Stock Exchange (www.hkex.com.hk). Whether or not you are able to attend the meeting, you are requested to complete and return the reply slip and the form of proxy in accordance with the instructions printed thereon as soon as practicable and in any event not later than 20 days and 24 hours, respectively, before the time designated for holding the meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting or any adjourned meeting should you so wish.

• The Company is registered as an oversea company under Part XI of the Companies Ordinance (Chapter 32 of the Laws of Hong Kong) under the English name “Dalian Port (PDA) company Limited”.

30 January 2008

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Letter from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
Letter from the Independent Financial Adviser. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
Appendix 1 – General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	23
Appendix 2 – Notice of Extraordinary General Meeting. . . . . . . . . . . . . . . . . . . . . . . .	29

DEFINITIONS

In this circular, the following expressions have the following meanings unless the context requires otherwise:

“associate(s)”	has the meaning ascribed to it under the Listing Rules;
“Board”	the board of Directors;
“Company”	大連港股份有限公司(Dalian Port (PDA) Company
	Limited), a sino-foreign joint stock limited company
	incorporated in the PRC with its H shares listed and
	traded on the main board of the Stock Exchange;
“connected person”	has the meaning ascribed to it under the Listing Rules;
“Continuing Connected	the transactions contemplated under the Terminal
Transactions”	Facilities Design and Construction Services Agreement
	and the Comprehensive Services Agreement;
“Continuing Connected	the Terminal Facilities Design and Construction
Transactions Agreements”	Services Agreement and the Comprehensive Services
	Agreement;
“controlling shareholder”	has the meaning ascribed to it under the Listing Rules;
“Directors”	the directors of the Company;
“EGM”	the extraordinary general meeting of the Company to
	be held at Room 602, PDA Group Building, No. 1
	Gangwan Street, Zhongshan District, Dalian City,
	Liaoning Province, the PRC at 10:00 a.m. on 20 March
	2008, the notice of which is set out in Appendix 2 of
	this circular;
“Group”	the Company and its subsidiaries;
“H shares”	foreign shares in the share capital of the Company,
	with Renminbi-denominated par value of RMB1.00
	each which are listed and traded on the Stock
	Exchange;
“HK$”	Hong Kong dollars, the lawful currency of the Hong
	Kong Special Administrative Region;
“Independent Board Committee”	the independent board committee of the Company
	comprising the independent non-executive Directors,
	namely, Mr. Yang Zan, Mr. Zhang Xianzhi and Mr.
	Ng Ming Wah, Charles;

– 1 –

DEFINITIONS

“Independent Financial Adviser”	Access Capital Limited, a licensed corporation under
	the SFO which engages in Type 1 (dealing in
	securities), Type 4 (advising on securities), Type 6
	(advising on corporate finance) and Type 9 (asset
	management) regulated activities and the independent
	financial adviser to the Independent Board Committee
	and the Independent Shareholders in respect of the
	Continuing Connected Transactions;
“Independent Shareholders”	Shareholders other than PDA and its associates;
“Latest Practicable Date”	25 January 2008, being the latest practicable date prior
	to the printing of this circular for ascertaining certain
	information contained in this circular;
“Listing Rules”	the Rules Governing the Listing of Securities on The
	Stock Exchange of Hong Kong Limited;
“PDA”	大連港集團有限公司(Dalian Port Corporation
	Limited), the controlling shareholder of the Company
	and a limited liability company established in the PRC
	and wholly-owned by Dalian Municipal Government;
“PRC”	the People’s Republic of China (for the purpose of
	this circular, excluding Hong Kong Special
	Administrative Region, Macau Special Administrative
	Region and Taiwan);
“Prospectus”	the prospectus dated 18 April 2006 and published by
	the Company, in accordance with the Listing Rules in
	the connection with its initial public offering and
	listing on the main board of the Stock Exchange;
“RMB” or “Renminbi”	renminbi, the lawful currency of the PRC;
“SFO”	Securities and Futures Ordinance (Chapter 571 of the
	Laws of Hong Kong;
“Shareholders”	the shareholders of the Company;
“Stock Exchange”	The Stock Exchange of Hong Kong Limited;
“subsidiary”	has the meaning ascribed to it under the Listing Rules;
	and
“%”	percentage

– 2 –

LETTER FROM THE BOARD

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Dalian Port (PDA) Company Limited __ 大連港股份有限公司*

(a sino-foreign joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 2880)

Directors: Executive Directors: Sun Hong Zhang Fengge Jiang Luning Su Chunhua

Registered Office:

Xingang Commercial Building Dayao Bay Dalian Free Trade Zone PRC

Place of Business in PRC:

Non-executive Directors: Lu Jianmin

Independent Non-executive Directors: Yang Zan Zhang Xianzhi Ng Ming Wah, Charles

No. 1 Gangwan Street Zhongshan District Dalian, Liaoning PRC

30 January 2008

To the Shareholders,

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTIONS AND NOTICE OF THE FIRST EXTRAORDINARY GENERAL MEETING IN 2008

1. INTRODUCTION

Reference is made to the announcement dated 10 January 2008 regarding the proposed revised caps for the Continuing Connected Transactions. The purpose of this circular is to (i) set out the detailed information regarding the Continuing Connected Transactions contemplated under Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement; (ii) to give you the notice of the EGM to consider and approve the proposed ordinary resolutions.

• The Company is registered as an oversea company under Part XI of the Companies Ordinance (Chapter 32 of the Laws of Hong Kong) under the English name “Dalian Port (PDA) company Limited”.

– 3 –

LETTER FROM THE BOARD

2. REVISION OF ANNUAL CAPS FOR THE CONTINUING CONNECTED TRANSACTIONS

As disclosed in the Prospectus, the Group is party to a number of existing continuing connected transactions. In this connection, the Company was granted waivers by the Stock Exchange from strict compliance with the relevant requirements in Chapter 14A of the Listing Rules for a period of three years from 1 January 2006 to 31 December 2008 at the time of listing of the H Shares of the Company on the Stock Exchange on 28 April 2006. The waivers granted by the Stock Exchange are subject to annual caps. In accordance with Rule 14A.36 of the Listing Rules, if an annual cap in respect of a given transaction is exceeded or when there is a material change to the terms of the relevant agreement, the Company must re-comply with Rules 14A.35(3) and (4) of Chapter 14A of the Listing Rules in relation to such connected transactions.

A. Terminal Facilities Design and Construction Services

• (a) Revised cap for the terminal facilities design and construction services

As disclosed in the Prospectus, PDA owns the terminal facilities construction asset and business and has, for itself and/or its relevant associates, entered into the Terminal Facilities Design and Construction Services Agreement with the Company (for itself and/or on behalf of its relevant subsidiaries) on 23 March 2006, to provide terminal facilities design and construction services including land filling, dredging, caisson precasting and construction of electricity facilities and other supporting facilities.

The Stock Exchange has granted a waiver in respect of the transaction under the Terminal Facilities Design and Construction Services Agreement when the Company was listed on the main board of the Stock Exchange on 28 April 2006. The existing caps set for the terminal facilities design and construction services for the year ended 31 December 2006 and the years ending 31 December 2007 and 31 December 2008 are RMB265,000,000, RMB223,000,000 and RMB25,000,000, respectively.

With commencement of construction of new projects (mainly including projects of construction of crude oil tanks at Sha Tuo Zi, construction of Dayaowan Phase-II container terminal and expansion of No. 18 to No. 21 oil terminals) and delay in completion of certain projects, the total amount payable for the terminal facilities design and construction services for the year 2008 will greatly exceed the existing cap set for such services for such year. Therefore, the Company proposes that the annual cap for such transactions for the year 2008 should be raised to RMB299,740,000.

– 4 –

LETTER FROM THE BOARD

• (b) Pricing

Under the Terminal Facilities Design and Construction Services Agreement, the price in respect of services provided by PDA and/or its relevant associates shall be determined in accordance with the following pricing principles:

• the price determined with reference to the relevant pricing policy prescribed by the relevant governmental authority (State price);

• where there is no State price, then according to the price at which the same or comparable types of services are provided from independent third parties in the ordinary course of business (market price); and

• where the project is subject to public bidding, the pricing principle established during the open bidding.

• (c) Cap

		Actual value		Proposed
	Original cap	for the year	Original cap	revised cap
	for the year	2007	for the year	for the year
	2007	(unaudited)	2008	2008
	(RMB)	(RMB)	(RMB)	(RMB)
Terminal Facilities Design
and Construction Services	223,000,000	155,663,000	25,000,000	299,740,000

For the year ended 31 December 2007, the aggregate value of the terminal facilities design and construction services provided by PDA and/or its relevant associates to the Group was approximately RMB155,663,000 which did not exceed the 2007 cap being RMB223,000,000.

B. Comprehensive Services

• (a) Revised cap for the comprehensive services

As disclosed in the Prospectus, PDA has retained certain assets and businesses, which are not considered as the core businesses of the Group. Such businesses include the provision of certain utilities and ancillary services such as supply of electricity and water and provision of landscaping services, conference services and fire station services. In this connection, the Company (for itself and on behalf of its subsidiaries) and PDA (for itself and on behalf of its relevant associates) have entered into the Comprehensive Services Agreement on 23 March 2006.

– 5 –

LETTER FROM THE BOARD

The caps set for the comprehensive services for the year ended 31 December 2006 and the years ending 31 December 2007 and 2008 are RMB22,500,000, RMB24,900,000 and RMB27,500,000 as the time of listing of the Company. With the continuing development of the business the Group (including the expansion of tugging business in particular) and commencement of operation of new terminal facilities at Xin Gang, the Company anticipated that the total value of such services for the year 2007 would exceed the cap for 2007 of RMB24,900,000, and therefore revised and made an announcement on 24 August 2007 about the annual cap for the year 2007 for such transaction to RMB29,750,000. At the time of making such announcement, the Company also considered that the cap for 2008 might need to be revised. However, due to the relevant estimate having not been finalized, the cap for such transaction for 2008 remained unchanged at the time of making the announcement about the revised annual cap for such transactions for the year 2007. With the relevant estimate having been determined, the Company proposes the annual cap for the year 2008 be revised to RMB41,750,000.

(b) Pricing

Under the Comprehensive Services Agreement, the price in respect of services provided by PDA and/or its relevant associates shall be determined in accordance with the following pricing principles:

• State price;

• where there is no State price, then according to the relevant market price; and

• where there is no relevant market price, then according to the contract price.

For the purpose of the Comprehensive Services Agreement:

• ’’State price’’ means the price set by or with reference to the relevant laws, regulations, determinations, orders and policies issued by the relevant departments of the PRC government or the price set by or with reference to the relevant laws, regulations, determinations, orders and policies issued by the relevant departments of the PRC government plus the actual cost incurred in providing such services;

• ’’market price’’ means the price at which the same or comparable types of services are provided from independent third parties in the ordinary course of business; and

• ’’contract price’’ means the actual cost incurred in providing such services.

– 6 –

LETTER FROM THE BOARD

(c) Cap

		Actual value		Proposed
	Original cap	for the year	Original cap	revised cap
	for the year	2007	for the year	for the year
	2007	(unaudited)	2008	2008
	(RMB)	(RMB)	(RMB)	(RMB)
Comprehensive Services	29,750,000	24,468,000	27,500,000	41,750,000

For the year ended 31 December 2007, the aggregate value of the comprehensive services provided by PDA and/or its relevant associates to the Group was approximately RMB24,468,000 which did not exceed the 2007 cap being RMB29,750,000.

The annual amount of the comprehensive services in 2008 to be provided by PDA to the Group is expected to exceed the cap originally set for 2008 primarily due to the same reason for revising the cap for 2007, which is the increase in demand for electricity and water supply as a result of the expansion of tugging business of the Group and commencement of operation of new terminal facilities, and also due to the increase in demand for supply of electricity, heat, water, telephone services and transportation services resulting from increase of use of offices owned by PDA and/or its relevant associates and labor services to be provided in connection with the operation of oil terminals of the Company. Based on the historical figure of 2007 and taking into account of the above mentioned reasons, the Company proposes the annual cap for 2008 in relation to the comprehensive services be revised to RMB41,750,000.

C. Reasons for entering into the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement

PDA has been carrying out terminal operations and ancillary terminal operations for many years and has the terminal related experiences and expertise. Before the reorganization for the listing of the Company on the Main Board of the Stock Exchange, the business and assets of the Group has been operated by PDA as an integrated organization. Due to the proximity and familiarity with the Group, the Directors, from economic and operational perspectives, consider that PDA and its associates are the most suitable (but not only) provider of the services mentioned above to the Group. Besides, all of such transactions have been entered into on no less favourable to the Group than terms available from independent third parties. Therefore, the Directors are of the view that it is in the interests of the Company and the shareholder as a whole to source such services from PDA and its relevant associates in stead of independent third parties.

– 7 –

LETTER FROM THE BOARD

3. LISTING RULES IMPLICATIONS

PDA, being the controlling shareholder of the Company, is a connected person of the Company as defined under Rule 14A.11(1) of the Listing Rules. As such, the transactions under the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement constitute continuing connected transactions as defined under Rule 14A.13 of the Listing Rules.

With respect to the proposed revised caps for the transactions under the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement for the year 2008, each of the applicable percentage ratios is more than 2.5% and the proposed annual caps for such transactions are more than HK$10,000,000, such transactions will be subject to the reporting, announcement and independent shareholders’ approval (by way of a poll) requirements under Chapter 14A of the Listing Rules. For the purpose of obtaining the independent shareholders’ approval on such transactions and their respective cap for the year 2008, the Company will convene an EGM pursuant to the Listing Rules.

4. INFORMATION OF THE GROUP AND PDA

The principal activities of the Group are: (i) the provision of terminal and logistics services for oil products and liquefied chemicals; (ii) the provision of terminal and logistics services for containers, including container sea-to-sea transshipment services; (iii) the provision of port value-added services including tugging, pilotage, tallying and IT services; and (iv) the provision of automobile terminal and logistics services.

PDA is principally engaged in dry bulk and general cargo terminal operations, passenger and roll-on and roll-off cargo terminal operations and ancillary terminal operations and is the controlling shareholder of the Company holding approximately 62.09% of the total issued share capital of the Company as at the Latest Practicable Date.

5. GENERAL

The Independent Board Committee comprising all of the independent non-executive Directors of the Company, namely Mr. Yang Zan, Mr. Zhang Xianzhi and Mr. Ng Ming Wah, Charles, has been formed to advise the Independent Shareholders in relation to the Continuing Connected Transactions.

The Independent Financial Adviser has been appointed to advise the Independent Board Committee and the Independent Shareholders as to whether the terms of the Continuing Connected Transactions and the proposed annual caps in relation thereto for the year 2008 are fair and reasonable.

The Independent Financial Adviser considers the Continuing Connected Transactions are in normal commercial terms and in ordinary course of business. The Independent Financial Adviser also considers the terms of the Continuing Connected Transactions are fair and reasonable and in the interests of the Company and the Shareholders as a whole. The letter from the Independent Financial Adviser is set out on pages 12 to 22 of this circular.

– 8 –

LETTER FROM THE BOARD

6. EXTRAORDINARY GENERAL MEETING

Pursuant to Rule 14A.54 of the Listing Rules, any connected person and any shareholder and their associates with a material interest in the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement are required to abstain from voting on the relevant resolution at the EGM. Therefore, PDA and its associates are required to abstain from voting on the resolutions in respect of such agreement and the transactions contemplated thereunder at the EGM.

The EGM is proposed to be held at Room 602, PDA Group Building, No. 1 Gangwan Street, Zhongshan District, Dalian City, Liaoning Province, PRC at 10 a.m. on 20 March 2008, at which resolutions to approve: (1) the revised annual cap for the year 2008 for the continuing connected transactions (as defined in Listing Rules) contemplated under the Terminal Facilities Design and Construction Services Agreement dated 23 March 2006 and entered into between the Company and PDA; and (2) the revised annual cap for the year 2008 for the continuing connected transactions (as defined in Listing Rules) contemplated under the Comprehensive Services Agreement dated 23 March 2006 and entered into between the Company and PDA.

7. RECOMMENDATION

The Directors consider the transactions contemplated under the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement are carried out in the ordinary and usual course of business of the Group and on terms no less favourable to the Group than terms available from independent third parties which are fair and reasonable and in the best interests of the Company and its Shareholders as a whole. The Directors also consider the proposed caps for 2008 for such transactions are fair and reasonable.

The Independent Board Committee, having taken into account, among other things, the advice of the Independent Financial Adviser, consider that the terms of the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement and the proposed annual caps in relation thereto for the year 2008, are fair and reasonable, on terms no less favourable to the Group than terms available from independent third parties and in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors and the Independent Board Committee recommend that the Independent Shareholders should vote in favor of the ordinary resolutions set out in the notice of EGM contained in this circular.

Yours faithfully, SUN Hong Chairman

– 9 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

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Dalian Port (PDA) Company Limited __ 大連港股份有限公司*

(a sino-foreign joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 2880)

30 January 2008

Independent Board Committee: Mr. Yang Zan Mr. Zhang Xianzhi Mr. Ng Ming Wah, Charles

To the Independent Shareholders

Dear Sir or Madam,

CONTINUING CONNECTED TRANSACTIONS

We refer to the circular dated 30 January 2008 of the Company (the “Circular”) of which this letter forms part. Terms defined in the Circular have the same meanings herein unless the context otherwise requires.

We have been appointed as members of the Independent Board Committee to consider the terms of the Continuing Connected Transactions and to advise the Independent Shareholders whether, in our opinion, the terms of the Continuing Connected Transactions are fair and reasonable so far as the Independent Shareholders are concerned and are in the interest of the Company and the Shareholders as a whole. Access Capital Limited has been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the terms of the Continuing Connected Transactions.

Your attention is drawn to the “Letter from the Board” set out on pages 3 to 9 of the Circular which contains, inter alia , information about the Continuing Connected Transactions, and the “Letter from the Independent Financial Adviser” set out on pages 12 to 22 of the Circular which contains its advice in respect of the terms of the Continuing Connected Transactions.

• The Company is registered as an oversea company under Part XI of the Companies Ordinance (Chapter 32 of the Laws of Hong Kong) under the English name “Dalian Port (PDA) company Limited”.

– 10 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

As your Independent Board Committee, we have discussed with the management of the Company the reasons for entering into the Continuing Connected Transaction Agreements and the basis upon which their terms have been determined. We have also considered the key factors taken into account by the Independent Financial Adviser in arriving at its opinion regarding the terms of the said agreements as set out in the letter from the Independent Financial Adviser contained in the Circular, which we urge you to read carefully.

Having considered the advice given by the Independent Financial Adviser in arriving at its advice, we consider that the terms of the Continuing Connected Transactions are fair and reasonable so far as the Independent Shareholders are concerned and the Continuing Connected Transactions are in the interests of the Company and the Shareholders as a whole. We also consider the transactions contemplated under the relevant agreement to be in the usual and ordinary course of business and on terms no less favourable to the Group than terms available from independent third parties and the respective annual caps for the Continuing Connected Transactions to be fair and reasonable. We, therefore, recommend the Independent Shareholders to vote in favour of the relevant ordinary resolutions in respect of the Continuing Connected Transactions to be proposed at the EGM.

Yours faithfully, Independent Board Committee Yang Zan Zhang Xianzhi Ng Ming Wah, Charles Independent Independent Independent non-executive director non-executive director non-executive director

– 11 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the text of the letter of advice from Access Capital to the Independent Board Committee and the Independent Shareholders in relation to the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement and the proposed caps prepared for the purpose of incorporation in this circular.

Suite 606, 6th Floor Bank of America Tower 12 Harcourt Road Central Hong Kong

30 January 2008

To: The Independent Board Committee

and the Independent Shareholders of Dalian Port (PDA) Company Limited

Dear Sirs,

CONTINUING CONNECTED TRANSACTIONS

I. INTRODUCTION

We refer to our appointment as independent financial adviser to advise the Independent Board Committee and the Independent Shareholders with regard to the continuing connected transactions in relation to the terminal facilities design and construction services and the comprehensive services (together the “Continuing Connected Transactions”). Details of the proposed revised caps for the transactions under the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement for the year 2008 are contained in the “Letter from the Board” of the circular to the Shareholders dated 30 January 2008 (the “Circular”), of which this letter forms part. Terms used in this letter shall have the same meanings as those defined in the Circular unless the context otherwise specifies.

Reference is also made to the Prospectus and the announcement of the Company dated 10 January 2008 (the “Announcement”) in relation to the Continuing Connected Transactions.

As disclosed in the Prospectus, the Group is party to a number of existing continuing connected transactions, including the terminal facilities design and construction services, the comprehensive services, the construction management services, the properties leasing and the maintenance services. In this connection, the Company was granted waivers by the Stock Exchange from strict compliance with the relevant requirements of Chapter 14A

– 12 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

of the Listing Rules for a period of three years from 1 January 2006 to 31 December 2008 at the time of listing of H Shares of the Company on the Stock Exchange in April 2006. The waivers granted by the Stock Exchange are subject to annual caps. In accordance with Rule 14A.36 of the Listing Rules, if an annual cap in respect of a given transaction is exceeded or when there is a material change to the terms of the relevant agreement, the Company must re-comply with Rules 14A.35(3) and (4) of Chapter 14A of the Listing Rules in relation to such connected transaction.

With respect to the proposed revised caps for the transactions under the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement for the year 2008, each of the applicable percentage ratios is on an annual basis more than 2.5% and the proposed annual caps for such transactions are more than HK$10,000,000, such transactions are subject to the reporting, announcement and independent shareholders’ approval requirements under Chapter 14A of the Listing Rules.

As at the Latest Practicable Date, PDA beneficially owned approximately 62.09% of the issued share capital of the Company, will abstain from voting in the EGM to be convened for the approval of the proposed revised caps for the Continuing Connected Transactions for the year 2008.

II. THE INDEPENDENT BOARD COMMITTEE

The Board currently consists of four executive directors, namely Mr. Sun Hong, Mr. Zhang Fengge, Mr. Jiang Luning and Ms. Su Chunhua, one non-executive director, Mr. Lu Jianmin and three independent non-executive directors, namely Mr. Yang Zan, Mr. Zhang Xianzhi and Mr. Ng Ming Wah, Charles.

The Independent Board Committee comprising the independent non-executive directors, namely Mr. Yang Zan, Mr. Zhang Xianzhi and Mr. Ng Ming Wah, Charles, has been established to consider the terms of the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement and the proposed annual caps of such transactions for the year 2008.

We have been appointed to advise the Independent Board Committee and the Independent Shareholders as to whether the terms of the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement were agreed on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned and in the interests of the Company and the Shareholders as a whole and to give our opinion in relation to the the proposed revised caps for the Continuing Connected Transactions for the year 2008 for their consideration when making their recommendation to the Independent Shareholders.

– 13 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

III. BASIS AND ASSUMPTIONS OF THE ADVICE

In formulating our advice, we have relied solely on the statements, information, opinions and representations for matters relating to the Group contained in the Circular and the information and representations provided to us by the Group and/or its senior management staff and/or the Directors. We have assumed that all such statements, information, opinions and representations for matters relating to the Group contained or referred to in the Circular or otherwise provided or made or given by the Group and/or its senior management staff and/or the Directors and for which it is/they are solely responsible were true and accurate and valid at the time they were made and given and continue to be true and valid as at the date of the Circular. We have assumed that all the opinions and representations for matters relating to the Group made or provided by the Directors and/or the senior management staff of the Group contained in the Circular have been reasonably made after due and careful enquiry. We have also sought and obtained confirmation from the Group and/or its senior management staff and/or the Directors that no material facts have been omitted from the information provided and referred to in the Circular.

We consider that we have reviewed all currently available information and documents which are available to enable us to reach an informed view and to justify our reliance on the information provided so as to provide a reasonable basis for our opinions. We have no reason to doubt the truth, accuracy and completeness of the statements, information, opinions and representations provided to us by the Group and/or its senior management staff and/or the Directors and their respective advisers or to believe that material information has been withheld or omitted from the information provided to us or referred to in the aforesaid documents. We have not, however, carried out an independent verification of the information provided, nor have we conducted an independent investigation into the business and affairs of the Group or any of its subsidiaries.

IV. PRINCIPAL FACTORS AND REASONS CONSIDERED

In formulating our recommendation, we have taken into consideration the following principal factors and reasons:

1. Terminal Facilities Design and Construction Services

• 1.1 Background to and reasons for the terminal facilities design and construction services

As disclosed in the Prospectus, PDA owns the terminal facilities construction asset and business and has, for itself and/or its relevant associates, entered into the Terminal Facilities Design and Construction Services Agreement with the Company (for itself and/or on behalf of its relevant subsidiaries) on 23 March 2006, to provide terminal facilities design and construction services including land filling, dredging, caisson precasting and construction of electricity facilities and other supporting facilities.

– 14 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The existing caps set for the terminal facilities design and construction services for the year ended 31 December 2006 and the years ending 31 December 2007 and 31 December 2008 are RMB265,000,000, RMB223,000,000 and RMB25,000,000, respectively. The Stock Exchange has granted a waiver in respect of the transaction under the Terminal Facilities Design and Construction Services Agreement when the Company was listed on the main board of the Stock Exchange on 28 April 2006.

Revision of the original construction work schedule

With commencement of construction of new projects (mainly including projects of construction of crude oil tanks at Sha Tuo Zi, construction of Dayaowan Phase-II container terminal and expansion of No. 18 to No. 21 oil terminals), the total amount payable for the terminal facilities design and construction services for the year 2008 will exceed the existing cap set for such services for such year. Therefore, the Company proposes the annual cap for such transactions for the year 2008 be revised to RMB299,740,000.

• 1.2 Basis for determining the price under the Terminal Facilities Design and Construction Services Agreement

Under the Terminal Facilities Design and Construction Services Agreement, the price in respect of services provided by PDA and/or its relevant associates shall be made in accordance with the following pricing principles:

• the price determined with reference to the relevant pricing policy prescribed by the relevant governmental authority (“State price”);

• where there is no State price, then according to the price at which the same or comparable types of services are provided from independent third parties in the ordinary course of business (“Market price”); and

• where the project is subject to public bidding, the pricing principle established during the open bidding.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

• 1.3 Basis for determining the proposed cap amounts of the the terminal facilities design and construction services in 2008

		Actual
	Original cap	value for	Original cap	Proposed
	for the year	year 2007	for the year	revised cap for
	2007	(unaudited)	2008	the year 2008
	(RMB)	(RMB)	(RMB)	(RMB)
Terminal Facilities
Design and Construction
Services	223,000,000	155,663,000	25,000,000	299,740,000

As stated in the “Letter from the Board” for the year ended 31 December 2007, the aggregate value of the terminal facilities design and construction services provided by PDA and/or its relevant associates to the Group was approximately RMB155,663,000 which did not exceed the original cap amount of RMB223,000,000 for the year ended 31 December 2007.

We noted from the Announcement that the actual value for 11 months ended 30 November 2007 as a percentage of original cap for the year 2007 representing only approximately 50.9%. In this regard, we have obtained from the management the unaudited amount of the actual value for the month ended 31 December 2007 which amounted to approximately RMB42.2 million. Accordingly, the actual value of work carried out in December 2007, together with the actual value of work performed in the first 11 months in 2007, would bring the total actual value for the year to RMB155.7 million, representing approximately 69.8 % of the original cap amount of RMB223 million.

We further understand from the management of the Company that during the course of 2007, certain projects planned to be constructed in 2007 was postponed to 2008 (the “Rescheduled Construction Work”) and therefore, the latest estimate of the usage of the terminal facilities design and construction services will correspondendly be increased as the Rescheduled Construction Work is due to take place in 2008, reflecting the latest cost esimate of these postponed projects.

In addition, we have reviewed the original planned schedule of construction work to be carried out in 2008 and noted that, the Company has, in arriving the proposed revised cap for 2008, also taken into account of certain new projects which are scheduled to take place in 2008 but was previously not planned for at the time of the listing of the Company.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

In setting the amount of the revised annual cap for 2008, the Company has also take into account of the growth trend of traffic throughput of the Group in recent years, as illustrated in the following table:

Increase trend of volume of business handled in recent years

The following table sets out the throughput of crude oil, liquefied chemicals and container handled by the Group from year 2004 to 2007.

The oil/liquefied chemicals throghput handled by the Group

	2004	2005	2006	2007
Crude Oil (’000 tonnes)	18,272	18,259	20,890	22,880
Refined Oil (’000 tonnes)	11,652	13,187	10,968	10,345
Liquefied chemicals
(’000 tonnes)	448	524	879	1,175
Total (’000 tonnes)	30,372	31,970	32,737	34,400
Growth rate (%)	N/A	5.26%	2.4%	5.08%
The container throughput		handled by	the Group
	2004	2005	2006	2007
Foreign Trade (’000 TEU)	1,999	2,382	2,818	3,328
Domestic Trade (’000 TEU)	173	216	328	396
Total (’000 TEU)	2,172	2,598	3,146	3,724
Growth rate (%)	N/A	19.61%	21.09%	18.37%

Sources: The Company’s prospectus dated 18 April 2006, annual reports and the announcement of the Company dated 8 January 2008.

For the first half of 2007, China’s Gross Domestic Product (“GDP”) and foreign trade value increased by 11.5% and 23.3%, respectively, as compared to the same period in 2006. In addition, according to the Government Work Reports issued by the Provinces of Heilongjiang, Jilin and Liaoning (being the three provinces in northeastern China) respectively, the growth targets of GDP for these three provinces in 2007 would be 11%, 15% and 11% respectively. Capitalising on the sound marco-economic environment, especially the sound economic development in the three provinces in northeastern China, the Group achieved a satisfactory performance in its business.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As indicated above, the total oil/chemicals throughput handled by the Group increased from approximately 30.4 million tonnes in 2004 to approximately 34.40 million tonnes in 2007, representing a compound growth rate of approximately 4.24%. In addition, the container throughput handled by the Group was also growing satisfactory over the years, from a total of approximately 2.2 million TEUs in 2004 to approximately 3.7 million TEUs in 2007, representing a compound annual growth rate of approximately 19.69%.

In assessing the fairness of the proposed annual cap for year 2008, we have reviewed the information and materials supplied by the management of the Company and noted that the proposed revised annual cap for 2008 is arrived at with reference to (i) the internal schedule of construction work, in particular, the number of new construction works which had not been included in the calculation of the existing annual cap for 2008 at the time of listing of the Company; (ii) the delay in completion of the Rescheduled Construction Work to be carried out in 2008; and (iii) pricing policy as stated above. We noted that the amount revised annual cap for 2008 was arrived at after taking into account of the above-mentioned factors, based on the above-mentioned pricing principals.

Taking into account (i) the variation in work schedules of 2007 and 2008 as described above; (ii) the basis upon which the revised annual cap of 2008 was arrived at as described above and (iii) the favorable market environment in northeastern China, we are of the view that the proposed revised annual cap for 2008 of RMB299,740,000 under the Terminal Facilities Design and Construction Services Agreement is fair and reasonable.

2. Comprehensive Services

2.1 Background to and reasons for the comprehensive services

As disclosed in the Prospectus, PDA has retained certain assets and businesses, which are not related to the core business of the Group. Such businesses include the provision of certain utilities and ancillary services such as supply of electricity and water and provision of landscaping services, conference services and fire station services. In this connection, the Company (for itself and on behalf of its subsidiaries) and PDA (for itself and on behalf of its relevant associates) have entered into the Comprehensive Services Agreement on 23 March 2006.

At the time of listing of the Company in 2006, the respective cap limit set for the comprehensive services for the year ended 31 December 2006, 2007 and the year ending 31 December 2008 are RMB22,500,000, RMB24,900,000 and RMB27,500,000. With the continuing development of the business of the

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Group (including the expansion of tugging business in particular) and commencement of operation of new terminal facilities at Xin Gang, the Company predicted that the total value of such services for the year 2007 would exceed the cap for 2007 of RMB24,900,000, and therefore revised and made an announcement on 24 August 2007 increase the annual cap for the year 2007 for such transaction to RMB29,750,000. At the time of making such announcement, the Company also considered that the cap for 2008 might also need to be revised. However, as the relevant cost estimate was not available at the time, the Company was not in a position to assess the requirement in 2008 and consequently did not seek to change the 2008 annual cap. With the relevant estimate having been determined, the Company proposes the annual cap for the year 2008 be revised to RMB41,750,000.

• 2.2 Basis for determining the price under the Comprehensive Services Agreement

Under the Comprehensive Services Agreement, the price in respect of services provided by PDA and/or its relevant associates shall be made in accordance with the following pricing principles:

• State price;

• where there is no State price, then according to relevant market price; and

• where there is no relevant market price, then according to the contract price.

For the purpose of the Comprehensive Services Agreement:

’’State price’’ means the price set by or with reference to the relevant laws, regulations, determinations, orders and policies issued by the relevant departments of the PRC government or the price set by or with reference to the relevant laws, regulations, determinations, orders and policies issued by the relevant departments of the PRC government plus the actual cost incurred in providing such services;

• ’’market price’ means the price at which the same or comparable types of services are provided from independent third parties in the ordinary course of business; and

• ’’contract price’’ means the actual cost incurred in providing such services.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

2.3 Basis for determining the proposed cap amounts of the comprehensive services in 2008

	Original cap	Actual value	Original cap	Proposed
	for the year	for the year	for the year	revised cap for
	2007	2007	2008	the year 2008
		(unaudited)
	(RMB)	(RMB)	(RMB)	(RMB)
Comprehensive Services	29,750,000	24,468,000	27,500,000	41,750,000

For the year ended 31 December2007, the aggregate value of the comprehensive services provided by PDA and/or its relevant associates to the Group was approximately RMB24,468,000, representing approximately 82.2% of the original cap amount of RMB29,750,000.

Based on information provided by the Company, set out below the breakdown of the comprehensive services comprising the original cap and the proposed revised cap, respectively, for the year ending 31 December 2008:

Provision of utilities/ Original cap for ancillary services the year 2008 (RMB’000) Electricity/water 18,700 Telephone 1,200 Heating/transportation 3,000 Landscaping 1,300 Fire station 2,800 Labour 0 Others 500 Total 27,500	Proposed revised cap for the year 2008 (RMB’000) 26,780 1,510 3,310 2,130 0 3,500 4,520
	41,750

The annual amount of the comprehensive services in 2008 to be provided by PDA and/or its relevant associates to the Group is expected to exceed the cap originally set for 2008. The expected excess is primarily due to the similar reasons as those required for revising the cap for 2007, and is the result of increase of the demand for electricity and water supply brought by the expansion of tugging business of the Group, the commencement of operation of new terminal facilities, and also due to the increase of demand for supply of electricity, heat, water, telephone services and transportation services resulting from increase of use of offices owned by PDA and/or its relevant associates and labor services to be provided in connection with the operation of oil terminals of the Company. Based on the historical figure of 2007 and taking into account of the above mentioned reasons, the Company proposes the annual cap for 2008 in relation to the comprehensive services be revised to RMB41,750,000.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

For the year ended 31 December 2006, the aggregate tugging hours of the Group was 50,168, an increase of approximately 5.35% over 2005. The main driver of the growth of tugging business was the steady growth of throughput of Dalian port, the business expansion of peripheral shipyards and the expansion of markets outside Dalian port. For the first six month in 2007, the aggregate number of tugging hours of the Group was 28,075, an increase of approximately 18% over the same period in 2006.

In assessing the fairness of the proposed annual cap for year 2008, we have reviewed the materials supplied by the management of the Company and noted that the proposed cap is estimated with reference to (i) the internal estimation; (ii) the continuing development of the business of the Group; (iii) the commencement of operation of new terminal facilities at Xin Gang; and (iv) pricing policy as stated above.

Taking into account (i) the basis for the proposed annual cap for year 2008; (ii) the favorable market environment mentioned above coupled with the increasing throughput volume of Dalian port and the expansion of tugging business; (iii) the commencement of operation of new terminal facilities, we are of the view that the proposed annual cap under the Comprehensive Services Agreement are justifiable and fair and reasonable.

3. Reasons for entering into the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement

PDA has been carrying out terminal operations and ancillary terminal operations for many years and has the terminal related experiences and expertise. Before the reorganization for the listing of the Company on the Main Board of the Stock Exchange, the business and assets of the Group has been operated by PDA as an integrated organization. Due to the proximity and familiarity with the Group, the Directors, from economic and operational perspectives, consider that PDA and its associates are the most suitable (but not only) provider of the services mentioned above to the Group. Besides, all of such transactions have been entered into on no less favourable to the Group than terms available from independent third parties. Therefore, the Directors are of the view that it is in the interests of the Company and the shareholder as a whole to source such services from PDA and its relevant associates in stead of independent third parties.

Given (i) the services under the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement are normal and basic infrastructural support to the Group’s business and in the ordinary and usual course of business of the Group; and (ii) the prices under the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement are determined under the relevant pricing policies, accordingly, we concur with the view of the Directors that the services provided under the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement are in the ordinary and usual course of business of the Group and on normal commercial terms and is in the interests of the Company and the Shareholders as a whole.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

V. RECOMMENDATION

After having considered the above principal factors, namely (i) the background and reasons for the Continuing Connected Transactions for the year 2008; and (ii) the proposed cap amounts for the Continuing Connected Transactions for the year 2008, we are of the view that the terms of the Terminal Facilities Design and Construction Services Agreement and the Comprehensive Services Agreement (together with the respective caps amount) are on normal commercial terms, in the ordinary and usual course of business of the Group and are fair and reasonable so far as the Shareholders are concerned and are in the interests of the Group and the Independent Shareholders as a whole. Accordingly, we advise the Independent Board Committee to recommend to the Independent Shareholders to vote in favour of the ordinary resolution(s) in relation to the proposed revised caps for the Continuing Connected Transactions for the year 2008 at the EGM.

Yours faithfully For and on behalf of Access Capital Limited Jimmy Chung Executive Director

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APPENDIX 1

GENERAL INFORMATION

RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Group. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiry, that to the best of their knowledge and belief, there are no other facts, the omission of which would make any statement herein misleading.

DISCLOSURE OF INTERESTS

1. Directors, supervisors or chief executive’s interests in securities

As at the Latest Practicable Date, as far as the Company was aware, none of the Directors or chief executive or supervisors of the Company had any interest or short position in the shares, underlying shares or debentures of the Company or any associated corporation (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 and short positions which they were taken or deemed to have under such provisions of the SFO); or which were required, pursuant 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.

2. Substantial shareholders’ and other persons’ interests in securities

As at the Latest Practicable Date, so far as was known to any Director or the chief executive of the Company, the persons, other than a Director or chief executive or a supervisor of the Company, who had an interest or a short position in the shares or the underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO or who were directly or indirectly, interested in 10% or more of the nominal value of any class of share capital

– 23 –

APPENDIX 1

GENERAL INFORMATION

(including any options in respect of such capital) carrying rights to vote in all circumstances at general meetings of any other member of the Group were as follows:

		Number		As a % of
		of shares/		relevant	As a % of
Name of	Class of	underlying		classof share	total share
Shareholder	shares	shares held	Capacity	capital1	capital2
Dalian Port	Domestic	1,816,815,000	Beneficial owner	97.5%	62.09%
Corporation	shares	(long position)
Limited
Fidelity	H Shares	115,831,000	Beneficial owner	10.90%	3.96%
International		(long position)
Limited
N.Y.K. Line Group	H shares	114,800,000	Interest of	10.80%	3.92%
(Hong Kong)		(long position)	controlled
Limited			corporation
N.Y.K. Line	H shares	114,800,000	Beneficial owner	10.80%	3.92%
(Hong Kong)		(long position)
Limited
Nippon Yusen	H shares	114,800,000	Interest of	10.80%	3.92%
Kabushiki		(long position)	controlled
Kaisha			corporation
The National	H shares	82,426,000	Beneficial owner	7.76%	2.82%
Social Security		(long position)
Fund Council
of the PRC
China Shipping	H shares	73,610,000	Interest of	6.92%	2.52%
(Group) Co., Ltd.		(long position)	controlled
			corporation
China Shipping	H shares	73,610,000	Interest of	6.92%	2.52%
(Hong Kong)		(long position)	controlled
Holdings Co,			corporation
Limited

– 24 –

APPENDIX 1

GENERAL INFORMATION

		Number			As a % of
		of shares/			relevant	As a % of
Name of	Class of	underlying		class of share		total share
Shareholder	shares	shares held	Capacity		capital1	capital2
China Shipping	H shares	73,610,000	Beneficial owner		6.92%	2.52%
Terminal		(long position)
Development
(Hong Kong)
Company
Limited
Citigroup Inc.	H shares	65,648,800	Beneficial owner		6.18%	2.24%
		(long position)		(long position)		(long position)
		54,172,800			5.10%	1.85%
		(short position)		(short position)		(short position)
		11,440,000			1.08%	0.39%
		(lending pool)		(lending pool)		(lending pool)
Indus Capital	H shares	64,341,200	Interest of		6.06%	2.20%
Partners, LLC		(long position)	controlled
			corporation
Kasowitz Sheldon	H shares	64,341,200	Interest of		6.06%	2.20%
Fenton		(long position)	controlled
			corporation
Kowitz David	H shares	64,341,200	Beneficial owner		6.06%	2.20%
Nathan		(long position)

Notes:

1. The relevant class of share capital: Domestic shares – 1,863,400,000 shares, H shares – 1,062,600,000 shares.

2. Total share capital: 2,926,000,000 shares.

Save as disclosed herein, so far as is known to any of the Directors or chief executive, as at the Latest Practicable Date, no other person (not being a Director or chief executive or a supervisor of the Company) had an interest or a short position in the shares or the underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO or which were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital (including any options in respect of such capital) carrying rights to vote in all circumstances at general meetings of any other member of the Group.

– 25 –

APPENDIX 1

GENERAL INFORMATION

SERVICE CONTRACT

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with the Company or any member of the Group other than contracts expiring or determinable by the relevant employer within one year without payment of compensation (other than statutory compensation).

COMPETING INTEREST

As at the Latest Practicable Date, none of the Directors and their respective associates had any interest in a business which competes or is likely to compete directly or indirectly with any business of the Group.

DIRECTORS’ INTERESTS IN THE GROUP’S ASSETS OR CONTRACTS

As at the Latest Practicable Date, none of the Directors, supervisors, proposed directors or proposed supervisors of the Company had any interest in any assets which have been since 31 December 2006 (being the date to which the latest published audited accounts of the Company were made up) acquired or disposed of by or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group. As at the Latest Practicable Date, none of the Directors or supervisors is materially interested in any contract or arrangement subsisting at the Latest Practicable Date which is significant in relation to the business of the Group.

LITIGATION

As at the Latest Practicable Date, neither the Company nor any other members of the Group was engaged in any litigation or arbitration of material importance and, as far as the Directors were aware, no litigation or claim of material importance was pending or threatened against the Company or any other members of the Group.

PROCEDURES FOR DEMANDING A POLL BY SHAREHOLDERS

Pursuant to the articles of association of the Company, a voting shall be made at the shareholders meeting by a show of unless a poll is demanded before or after any vote on a show of hands. A poll may be demanded by (i) the chairman of the meeting, (ii) at least two shareholders or proxies of such shareholders with voting rights, and (iii) one or more shareholders including proxy or proxies of such shareholders accounting individually or jointly 10% or more of the Company shares with voting right(s), shall have the right to request for a voting by poll before or after a voting by show of hands. Issues to vote by poll concerning election of the chairman or suspension of a meeting shall be taken forthwith. Other issues, the chairman shall determine the time for taking such poll and the meeting can go on with discussion of other matters. The result of such voting shall also be regarded as the resolution adopted at the meeting. A person who has made a request for voting by poll can withdraw it.

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APPENDIX 1

GENERAL INFORMATION

MATERIAL ADVERSE CHANGE

The Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 December 2006, being the date of the latest published audited financial statements of the Company.

CONSENT

As at the Latest Practicable Date, Access Capital Limited has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter and reference to its name in the form and context in which it appears.

As at the Latest Practicable Date, Access Capital Limited did not have any shareholding in any member of the Group or the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

QUALIFICATION OF EXPERTS

The following are the qualifications of the professional adviser who have given opinion or advice contained in this circular:

Name Qualification

Access Capital Limited A licensed corporation under the SFO which engages in Type 1 (dealing in securities), Type 4 (advising on securities), Type 6 (advising on corporate finance) and Type 9 (asset management) regulated activities.

MISCELLANEOUS

• (a) The joint company secretaries of the Company are Ms. Ma Jinru and Mr. Lee Kin Yu, Arthur. Mr. Lee is a member of the American Institute of Certified Public Accountants and the Hong Kong Institute of Certified Public Accountants.

• (b) The registered office of the Company is at Xingang Commercial Building, Dayao Bay, Dalian Free Trade Zone, the PRC. The place of business of the Company is No.1, Gangwan Street, Zhongshan District, Dalian, Liaoning, the PRC, Postal Code: 116001. The branch share registrar of the Company in Hong Kong is Computershare Hong Kong Investor Services Limited at Rooms 1712-16 Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong.

• (c) The English text of this document shall prevail over the Chinese text in the case of inconsistency.

– 27 –

APPENDIX 1

GENERAL INFORMATION

DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection at the offices of Morrison & Foerster at Edinburgh Tower, 41/F, The Landmark, 15 Queen’s Road Central, Hong Kong during normal business hours on any business day from the date of this circular until 15 February 2008:

• (a) the Continuing Connected Transactions Agreements;

• (b) the letter from the Independent Board Committee dated 30 January 2008, the text of which is set out on pages 10 to 11 of this circular;

• (c) the letter from Access Capital Limited dated 30 January 2008, the text of which is set out on pages 12 to 22

• of this circular;

• (d) the consent letter from Access Capital Limited referred to in the paragraph headed “Consent” in this Appendix; and

• (e) a copy of this circular.

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APPENDIX 2

NOTICE OF EXTRAORDINARY GENERAL MEETING

==> picture [71 x 32] intentionally omitted <==

==> picture [84 x 21] intentionally omitted <==

Dalian Port (PDA) Company Limited __ 大連港股份有限公司*

(a sino-foreign joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 2880)

NOTICE OF THE FIRST EXTRAORDINARY GENERAL MEETING IN 2008

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (“EGM”) of Dalian Port (PDA) Company Limited (the “Company”) will be held at 602, PDA Group Building, No. 1 Gangwan Street, Zhongshan District, Dalian City, Liaoning Province, PRC at 10:00 a.m. on 20 March 2008, for the purposes of considering and, if thought fit, approving and ratifying the following matters:

ORDINARY RESOLUTIONS

1. approve the revised annual cap for the year 2008 for the continuing connected transactions (as defined in the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”)) contemplated under the Terminal Facilities Design and Construction Services Agreement dated 23 March 2006 and entered into between the Company and Dalian Port Corporation Limited (“PDA”); and

2. approve the revised annual cap for the year 2008 for the continuing connected transactions (as defined in the Listing Rules) contemplated under the Comprehensive Services Agreement dated 23 March 2006 and entered into between the Company and PDA.

By Order of the Board of Directors MA Jinru LEE Kin Yu, Arthur Joint Company Secretaries

30 January 2008

Notes:

1. Each shareholder entitled to attend and vote at the extraordinary general meeting is entitled to appoint one or more proxies to attend and vote on his/her behalf at the EGM. A proxy need not be a shareholder of the Company. With respect to any shareholder who has appointed more than one proxy, the proxy holders may only vote on a poll. The shareholder shall have one vote for each share that they hold.

• The Company is registered as an oversea company under Part XI of the Companies Ordinance (Chapter 32 of the Laws of Hong Kong) under the English name “Dalian Port (PDA) company Limited”.

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APPENDIX 2

NOTICE OF EXTRAORDINARY GENERAL MEETING

2.

In order to determine the list of shareholders who are entitled to attend the EGM, the registers of members of the Company will be closed from 19 February 2008, to 19 March 2008, (both days inclusive), during which no share transfer will be registered. Holders of the H Shares and the Domestic Shares whose names appear on the registers of members as at 4:30 p.m. of 18 February 2008 are entitled to attend the EGM. In order to attend and vote at the EGM, holders of H Shares whose transfers have not been registered shall deposit the transfer documents together with the relevant share certificates at the H share registrar of the Company, Computershare Hong Kong Investor Services Limited at Shops 1712–1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong no later than 4:30 p.m. on 18 February 2008.

3.

The instruments appointing a proxy must be in writing under the hand of a shareholder or his/her attorney duly authorized in writing. If the shareholder is a corporation, that instrument must be either under the company seal or under the hand of its director or duly authorized attorney. If that instrument is signed by an attorney of the shareholder, the power of attorney authorising that attorney to sign or other authorization documents must be notarized.

The proxy form together with the power of attorney or other authorization document (if any) must be deposited at the office of Board of Directors at No. 1, Gangwan Street, Zhongshan District, Dalian, Liaoning, the PRC for holders of the Domestic Shares and at the H share registrar, Computershare Hong Kong Investor Services Limited at the address as stated in Note 2 above for holders of the H Shares not less than 24 hours before the time fixed for holding the extraordinary general meeting or any adjournment thereof (as the case may be).

Completion and return of the form of proxy will not preclude shareholders from attending and voting in person at the EGM or any adjourned meeting should you so wish.

Shareholders who intend to attend the EGM in person or by proxy should return the reply slip to the office of Board of Directors at the address as stated in Note 6 below on or before 28 February 2008 by hand, by post or by fax.

Shareholders attending the EGM in person or by proxy are required to present their identity certification. If the attending shareholders is a corporation, its legal representative or person authorized by the board or other decision making authority is required to present a copy of the relevant resolution of the board or other decision making authority approving him/her to attend the EGM on behalf of such corporations.

1. The contact details of the office of Board of Directors are as follows:

Room 616, PDA Building No. 1, Gangwan Street Zhongshan District Dalian City, Liaoning Province PRC Postal Code: 116001 Telephone No.: 86 411 8279 8566-801/811 Facsimile No.: 86 411 8279 8566-805/8279 8108

1. The EGM is expected to last for half a day and shareholders (in person or by proxy) attending the meeting shall be responsible for their own transportation and accommodation expenses.

2. The existing Board of Directors of the Company comprises four executive directors, namely Mr. SUN Hong, Mr. ZHANG Fengge, Mr. JIANG Luning and Ms. SU Chunhua, one non-executive director, namely Mr. LU Jianmin and three independent non-executive directors, namely Mr. YANG Zan, Mr. ZHANG Xianzhi and Mr. Ng Ming Wah, Charles.

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