The board of directors of China Gas Holdings Limited announced that Fujian Zhongran Meizhouwan Energy Co. Ltd.*, a subsidiary of the Company and Quanzhou Grand Pacific Chemical Co. Ltd. (``Quanzhou Grand'') have recently entered into large-scale terminal handling and storage service agreements (the ``Service Agreements''). Pursuant to the Service Agreement, Fujian Zhongran and Quanzhou Grand have agreed to cooperate in the following aspects: Quanzhou Grand will use Fujian Zhongran's liquefied hydrocarbon terminal, propane and propylene storage tanks and relevant facilities in Quangang district, Quanzhou, the People's Republic of China for loading and unloading, storage and pipeline transport services of propane and propylene. For the purpose of meeting the demand on storage capacity and turnover of propane, Quanzhou Grand will lease and use related equipment and facilities from Fujian Zhongran in the form of tank-to-tank transfer for a contract term of 10 years. Quanzhou Grand shall make an undertaking to Fujian Zhongran that the annual amount for tank- to-tank transfer will not be less than 600,000 tons and Fujian Zhongran shall give priority to Quanzhou Grand in satisfying the tank storage capacity required by Quanzhou Grand. Quanzhou Grand shall guarantee that all propane used for its production will be transported into Quanzhou Grand's factory solely through Fujian Zhongran's terminal and storage tanks. For the purpose of meeting the demand on storage capacity and turnover of propylene, Quanzhou Grand will lease and use related equipment and facilities from Fujian Zhongran in the form of chartered storage tanks for a contract term of 10 years. Fujian Zhongran shall charge handling fee for the terminal and facilities, and related fees for chartered storage tanks and tank-to-tank transfer services.