(Source: PRNewswire-Asia)
NEW YORK, July 29 /PRNewswire-Asia/ -- China Natural Gas, Inc. ("China Natural Gas" or the "Company") , a leading provider of compressed natural gas (CNG) for vehicular fuel and pipeline natural gas for industrial, commercial and residential use in Xi'an, China, today announced that the Company's variable interest entity Xi'an Xilan Natural Gas Co., Ltd. ("Xilan") has completed a Joint-Venture Cooperation Agreement (the "JV Agreement") with China National Petroleum Corporation Kunlun Natural Gas Co., Ltd. ("CNPC Kunlun"), a wholly owned subsidiary of China National Petroleum Corporation ("CNPC") and the largest supplier of compressed natural gas in China.
The goal of the joint-venture ("JV") is to establish a win-win strategic cooperation between Xilan and CNPC Kunlun, dedicated for the processing and distribution of CNG throughout China. The purpose of the JV will be to build and operate CNG compressor stations and fueling stations along CNPC's natural gas pipelines in China, sell compressed natural gas and provide vehicle conversion services from gasoline-fueled vehicles to hybrid (natural gas/gasoline) powered vehicles. CNPC Kunlun will hold 51% ownership of the JV, and Xilan will hold 49% ownership.
"We are extremely happy to be partnering with CNPC Kunlun, the largest oil and gas operator in China. The JV will highlight our complementary strengths and should mutually benefit both partners," commented Mr. Qinan Ji, China Natural Gas's CEO and Chairman of the Board. "CNPC Kunlun is a subsidiary of CNPC, the designated state-owned enterprise by CNPC to specialize in vehicular CNG business. It is also the largest CNG supplier in China, with business operations in 18 provinces and over 70 cities throughout China. In our view, CNPC Kunlun has dominant market leading position, strong brand, broad market coverage, and well-established distribution. We believe China Natural Gas has leading technology, rich experience, and deep expertise in developing, positioning, and managing natural gas operations, and the combination of our full-range CNG business line and pending LNG business line can provide us with unparalleled competitive advantages.
"As we proceed with our planned expansion in China to build and operate CNG compressor stations, we are confident that our combined strengths will allow the JV to quickly expand its market presence. Securing CNPC Kunlun as a strategic supplier of CNG not only will ensure the success of the JV but also will ensure a reliable supply of natural gas for Xilan's overall needs.
