China Energy Engineering : ANNOUNCEMENT CONNECTED TRANSACTION ACQUISITION OF THE TARGET ASSETS

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CHINA ENERGY ENGINEERING CORPORATION LIMITED*

(A joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 3996)

ANNOUNCEMENT CONNECTED TRANSACTION ACQUISITION OF THE TARGET ASSETS

The board of directors (the "Board") of China Energy Engineering Corporation Limited (the "Company") is pleased to announce that on 19 March 2021, Guangxi Water Conservancy and Hydropower Engineering Bureau Co., Ltd.* of China Energy Engineering Group (中國能源建設集團 廣西水電工程局有限公司) ("Guangxi Bureau"), a subsidiary of the Company, has entered into a physical assets transfer agreement (the "Physical Assets Transfer Agreement") with China Energy Engineering Group Asset Management Company Limited* (中國能源建設集團資產管理有限公司)

("Asset Company"), pursuant to which, Asset Company agreed to transfer its surviving assets including partial allocated land use right and the structures thereon at No. 2, Guizhong Avenue, Liuzhou, Guangxi Province to Guangxi Bureau at a consideration of RMB54,600,000.

Details of the principal terms and conditions of the transfer are set out below:

Date

19 March 2021

Parties

Asset Company, as the vendor; and

Guangxi Bureau, as the purchaser.

*

For identification purpose only

SUBJECT MATTER

Pursuant to the Physical Assets Transfer Agreement, Asset Company agreed to transfer its surviving assets including partial allocated land use right and the structures thereon at No. 2, Guizhong Avenue, Liuzhou, Guangxi Province (the "Target Assets") to Guangxi Bureau.

CONDITIONS PRECEDENT FOR TRANSFER

• (1) Asset Company and Guangxi Bureau have fulfilled their respective internal decision-making, asset evaluation and other related procedures in respect of the transfer of the Target Assets under the Physical Assets Transfer Agreement in accordance with laws;

• (2) Guangxi Bureau has committed to complete the land resumption for the Target Assets through the relevant governmental authorities at the location where the Target Assets are located;

• (3) Guangxi Bureau has detailed information on the transfer of the Target Assets and agreed to acquire the Target Assets in accordance with the acquisition conditions proposed by Asset Company;

• (4) Guangxi Bureau has acquired the Target Assets owned by Asset Company according to the provisions of the Physical Assets Transfer Agreement; and

• (5) Transactions in relation to the Target Assets under the Physical Assets Transfer Agreement are subject to the approval of China Energy Engineering Group Co., Ltd. ("Energy Group") which funded Asset Company. Guangxi Bureau is legally designated as the purchaser to acquire the

  Target Assets under the Physical Assets Transfer Agreement.

CONSIDERATION AND PAYMENT TERMS

According to the approval of Energy Group, Asset Company transferred the Target Assets under the

Physical Assets Transfer Agreement to Guangxi Bureau at a consideration of RMB54,600,000. Guangxi Bureau shall remit the transfer consideration after deducting the evaluation fee (the evaluation fee is based on the price on the entrusted evaluation contract) in one lump sum to the settlement account designated by Asset Company within 60 days after the effective date of the

Physical Assets Transfer Agreement.

DELIVERY

Asset Company shall, as soon as possible after entering into the Physical Assets Transfer Agreement, deliver the Target Assets and related ownership documents and technical materials to Guangxi Bureau.

After entering into the Physical Assets Transfer Agreement, Guangxi Bureau shall, as soon as possible, go through the registration procedures for the change of the Target Assets (if necessary)

with the competent authorities in accordance with relevant national regulations, and Asset Company shall provide necessary assistance and cooperation.

LIABILITIES OF DEFAULTS

After the Physical Assets Transfer Agreement takes effect, if either party fails to perform or does not fully perform the provisions under the Physical Assets Transfer Agreement, it constitutes a default. The defaulting party shall be liable for the default and shall compensate the observant party for the losses caused by the default.

INFORMATION ABOUT THE TARGET ASSETS

DTZ Debenham Tie Leung (Shenzhen) Company Limited (深圳市戴德梁行土地房地產評估有限公 司) has conducted an evaluation using the cost method and taking 30 June 2020 as the evaluation benchmark date, and issued the Real Estate Valuation Report (No. F/BJD1/2012/1258/TY/CJ), according to which, the total appraisal value of the Target Assets was RMB54,600,000. Asset Company and Guangxi Bureau reached the terms of the Physical Assets Transfer Agreement based on Asset Company's ownership of the above-mentioned Target Assets and the evaluation results of the Real Estate Valuation Report.

The Target Assets does not have any form of guarantee, including but not limited to the existence of collateral for the Target Assets, or any restrictions or obligations that affect the transfer of the Target Assets. The Target Assets are also not subject to mandatory measures such as seizure by any authorized institution.

The Target Assets were originally allocated to the predecessor company before the restructuring of Guangxi Bureau at nil consideration. Before the Company's overall restructuring and initial public offering in 2014, according to the restructuring requirements of state-owned enterprises or relevant guidance, and in view of the imperfect land and housing title certificates of the Target Assets, Energy Group issued the "Notice on Relevant Matters concerning the Detachment and Transfer of the Surviving Assets due to the Overall Restructuring of Guangxi Hydropower Engineering Bureau* (廣 西壯族自治區水電工程局)" (Zhong Neng Jian Zi Cai [2014] No. 495) (the "Transfer Notice") to transfer the Target Assets to Asset Company and the Target Assets were detached from the assets scope of the Group. For policy reasons, the land and housing title certificates of the Target Assets cannot be registered for alteration and are still registered under the name of the predecessor company before the restructuring of Guangxi Bureau.

REASONS FOR AND BENEFITS OF ENTERING INTO THE PHYSICAL ASSETS TRANSFER AGREEMENT

Since the Target Assets are currently included in the land resumption plan of Liuzhou in 2020, and according to the requirements of the local governmental authorities, the land resumption can be conducted by Guangxi Bureau only, therefore, the signing of the Physical Assets Transfer Agreement could realize the government land resumption and meet the needs of asset disposal. In addition, since the land is publicly "bided, auctioned and listed" after the government recovers the Target Assets, and the economic benefits of developing the land separately are not satisfying, the Company could maximize the benefits by transfer of the land to the government for resumption before comprehensive development under the urban renewal policy. Therefore, the subsidiary of the Company will obtain clear economic benefits by acquisition and further transfer of the Target Assets to the government for resumption.

GENERAL INFORMATION

The Company is a large comprehensive group company that provides overall solutions and full industry chain services to industries such as energy and power, infrastructure and real estate in China as well as over the world.

Guangxi Bureau is a limited liability company established and legally existing under the laws of the

PRC and a subsidiary of the Company. It is principally engaged in general contracting of water conservancy and hydropower projects construction, general contracting of construction projects, general contracting of highway projects, etc.

Asset Company is a reformed surviving asset management institution specifically established by Energy Group according to the overall restructuring needs and the management requirements for surviving state-owned assets. It is a wholly-owned subsidiary directly managed by Energy Group and was formally established on 16 August 2014. The ultimate beneficial owner of Asset Company is the State-owned Assets Supervision and Administration Commission of the State Council of the People's

Republic of China.

Energy Group was established on 29 September 2011. It is an ultra-large energy construction group approved by the State Council and directly managed by the State-owned Assets Supervision and

Administration Commission of the State Council of the People's Republic of China. It is the controlling shareholder of the Company and is mainly engaged in power and energy planning consultancy, survey and design and engineering contracting, equipment manufacturing and investment operations, etc. The ultimate beneficial owner of Energy Group is the State-owned Assets Supervision and Administration Commission of the State Council of the People's Republic of China.

LISTING RULES IMPLICATIONS

As of the date of this announcement, Energy Group directly or indirectly holds approximately 62.57% of the issued share capital of the Company and is the controlling shareholder of the Company, Asset Company is a wholly-owned subsidiary of Energy Group, and therefore, Asset Company constitutes a connected person of the Company under Chapter 14A of the Listing Rules. Accordingly, the Physical Assets Transfer Agreement and the transactions contemplated thereunder constitute connected transactions of the Company under the Listing Rules.

As one or more of the applicable percentage ratios under the Listing Rules in respect of the transfer of the Target Assets is more than 0.1% but less than 5%, the Physical Assets Transfer Agreement and the transactions contemplated thereunder shall be subject to, among other things, the reporting and announcement requirements but exempt from the independent shareholders' approval requirement under Chapter 14A of the Listing Rules.

CONFIRMATION OF THE DIRECTORS

Mr. Song Hailiang, an executive director of the Company, is also the chairman of Energy Group. Mr. Sun Hongshui, an executive director of the Company, is also a director and general manager of Energy Group. Both of them have abstained from voting at the Board meeting approving the Physical Assets Transfer Agreement and the transactions contemplated thereunder in accordance with the requirements of the Listing Rules. Save as disclosed above, none of the directors has material interest in the Physical Assets Transfer Agreement.

The directors (including the independent non-executive directors) are of the view that the Physical Assets Transfer Agreement and the transactions contemplated thereunder are on normal commercial terms, fair and reasonable, and entering into the Physical Assets Transfer Agreement and the transactions contemplated thereunder are in the interests of the Company and shareholders as a whole.

DEFINITIONS

In this announcement, unless the context requires otherwise, the following terms shall have the following meanings:

"Asset Company"

China Energy Engineering Group Asset Management Company Limited* (中國能源建設集團資產管理有限公司), a wholly-owned subsidiary of Energy Group

"Company"

China Energy Engineering Corporation Limited* (中國能源建設股 份有限公司), a joint stock limited company established in the PRC on 19 December 2014, whose H shares are listed on the Stock Exchange (Stock Code: 3996)

"Energy Group"

China Energy Engineering Group Co., Ltd.* (中國能源建設集團有 限公司), a wholly state-owned company established in the PRC on 29 September 2011, is the controlling shareholder and one of promoters of the Company and is therefore a connected person of the Company

"Group"

the Company and its subsidiaries

"Guangxi Bureau"

Guangxi Water Conservancy and Hydropower Engineering Bureau Co., Ltd.* of China Energy Engineering Group (中國能源建設集團 廣西水電工程局有限公司), a subsidiary of the Company

"Listing Rules"

the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, as amended from time to time

"PRC"

the People's Republic of China

"Physical Assets Transfer

Agreement"

the physical assets transfer agreement entered into between Guangxi Bureau, a subsidiary of the Company, and Asset Company on 19 March 2021, pursuant to which, Asset Company agreed to transfer its surviving assets including partial allocated land use right and the structures thereon at No. 2, Guizhong Avenue, Liuzhou, Guangxi Province to Guangxi Bureau at a consideration of RMB54,600,000

"Stock Exchange"

The Stock Exchange of Hong Kong Limited

By order of the Board

CHINA ENERGY ENGINEERING CORPORATION LIMITED*

Song Hailiang

Chairman

Beijing, the PRC 19 March 2021

As at the date of this announcement, the executive directors of the Company are Mr. Song Hailiang, Mr. Sun Hongshui and Mr. Ma Mingwei; the non-executive directors are Mr. Li Shulei, Mr. Liu Xueshi and Mr. Si Xinbo; and the independent non-executive directors are Mr. Zhao Lixin, Mr.

Cheng Niangao and Dr. Ngai Wai Fung.