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Since 1995, CF Energy has been involved in the city gas pipeline business. Presently, CF has over 21 years of experience in the city gas pipeline construction, operation and management industry. Our major urban gas projects are based in Sanya City, Hainan province and Pingxiang District, Jiangxi province.

Sanya Urban Gas Pipeline Project

PNG SALES

After the entering into a long-term PNG supply contract with CNOOC in 1999 and the construction of necessary pipelines and facilities, we have been distributing PNG in Sanya, Hainan since 2003 and our supply covers residential customers who are household users and non-residential customers such as hotels and restaurants, schools, hospitals and government canteens. In 2007, we were granted the concession right by the Sanya government and became the exclusive PNG distributor of the city. In addition to the PNG supplied by CNOOC, we may also procure LNG as the source to produce PNG for distribution. To establish our distribution network, we have set up the Nanshan Primary Station to receive the supply by CNOOC, as well as the Sanya Citygate Station and First Receiving Station to process PNG procured from CNOOC and LNG procured from other suppliers to a distributable state. There are also areal pressure regulation stations and end-user pressure regulation facilities built at various locations to facilitate the distribution according to the demand of different areas. The above stations and facilities are connected by the gas pipelines as detailed in the succeeding paragraph.

The project of Xiangdong urban gas pipeline

Service pipeline installation and connection

As part of our natural gas distribution business and for the purpose of transmitting PNG from our gas stations to our customers, we are responsible to install the gas pipeline networks and connect them to the end-users. The gas pipelines we constructed include transmission pipelines, distribution pipelines and service pipelines. The transmission pipelines are high pressure gas pipelines which connect our supplier’s gas receiving stations to our Nanshan Primary Station. The distribution pipeline are mid-to-high pressure gas pipelines that are distributed within the operating area stipulated in our concession right agreement. The service pipelines are mid-to-low pressure gas pipelines that connect our distribution pipelines to our customers’ properties. The transmission pipelines and distribution pipelines are recorded as our own assets, while the installation and connection of service pipelines for the customers is our another source of revenue. In parallel with the PNG sales, our service pipeline installation and connection targets at the same group of end-users, while we [mostly] deal with property developers as our customers when installing and connecting service pipelines for household users before these users occupy the properties. For the pipeline installation and connection, we engage contractors to perform the construction works while we generally manage the projects as a whole.