Tianjin Jinran Public Utilities Company Limited announced connected transaction of the Company in relation to the 2022 Gas Supply Contract entered into between Jinran China Resources and the Company. As the 2022 Gas Supply Contract will expire on 31 December 2022, on 15 November 2022, the Company and Jinran China Resources entered into the New Gas Supply Contract for the period from 1 January 2023 to 31 March 2024. The New Gas Supply Contract shall be effective upon, among other things, the Company having obtained the Independent Shareholders' approval pursuant to the Listing Rules, and the New Gas Supply Contract being approved by the board of directors of Jinran China Resources.

Pursuant to the New Gas Supply Contract, Jinran China Resources has agreed to supply to the Company, and the Company has agreed to source from Jinran China Resources, natural gas at the Gas Sourcing Price during the Contract Term. The Gas Sourcing Price is in essence a sum of the Gas Purchase Price (the purchase price at which Jinran China Resource purchases the gas from its upstream supplier(s)) and a gas allocation price (which is regulated by the TDRC from time to time), calculated on a volume-weighted average basis with reference to three different types of user (namely, (A) residential, (B) non-residential, and (C) heating), weighted by the Total Amount of Gas Supply. The reason for incorporating the elements of such different users in calculating the Gas Sourcing Price is to reflect the commercial fact that Jinran China Resources sources the natural gas concerned in the Gas Supply from government appointed and regulated ultimate suppliers of natural gas in the Tianjin region like PetroChina Company Limited at Gas Purchase Price that varies based on such categories.

It is therefore agreed commercially between the Company and Jinran China Resources that the Pricing Mechanism of Gas Sourcing Price would reflect the same in a weighted-average manner. Notwithstanding the aforesaid Pricing Mechanism, in the event there is any change in the national policy which affects the Gas Sourcing Price or its pricing mechanism, the national pricing policy shall be followed. In the event that the Company would like to discount the unit price of natural gas consumed or to be consumed by certain strategic customers who are not connected persons of the Company, Jinran China Resources and the Company may execute a supplemental agreement under which the discounted sum will be borne by both parties at a proportion to be stipulated.

The Company shall pay Jinran China Resources for the gas supplied monthly, and within two working days upon receipt of the invoice from Jinran China Resources. The amounts payable will be calculated at an estimated Gas Sourcing Price of that Settlement Period with the actual consumption of natural gas by the Company during the month and the discrepancy in the total volume transported (caused by minute leakage during transportation and/or the accuracy of the meter reading, if any) of 3%. Before the 25th day of the month before the beginning of a Settlement Period, (i) the estimated Gas Sourcing Price for the coming Settlement Period will be determined; and (ii) the actual Gas Sourcing Price of the prior Settlement Period will be verified in accordance with the Pricing Mechanism.

If there is any difference between the verified Gas Sourcing Price and the estimated Gas Sourcing Price (as applied in the monthly payment then already made by the Company), the parties shall settle such difference by way of refund or additional payment (as the case may be). Within two working days upon receipt of the prepayment invoice for such estimated prepayment fees, the Company will examine Jinran China Resources' settlement proof with its upstream source(s) and verify the Gas Sourcing Price, and inform Jinran China Resources of the results afterwards.