TORONTO, Aug. 08, 2018 (GLOBE NEWSWIRE) — Changfeng Energy Inc., (TSXV: CFY) (“Changfeng” or the “Company”) an energy provider in China, announces the following business updates:
Pingxiang Project Concession Right
On November 23, 2017, the Company announced that Sanya Changfeng New Energy Investment Co., Ltd. (“Sanya Changfeng”), a subsidiary of the Company and Hunan Zhongyou Gas Co., Ltd. (“Zhongyou Gas”), the joint shareholders of Pingxiang Changfeng Gas Co., Ltd. (now renamed as Pingxiang Xin’ao Changfeng Gas Co., Ltd.) (the “Project Company”) had entered into an equity restructuring agreement (the “Agreement”) with Xin’ao Gas Development Co. Ltd. and Xin’ao Gas (China) Investment Co., Ltd. (collectively, referred to as “Xin’ao Gas”) whereby Sanya Changfeng and Zhongyou Gas collectively agreed to dispose (the “Disposal”) to Xin’ao Gas a controlling interest in the Project Company. Pursuant to the Agreement, Sanya Changfeng and Zhongyou Gas have committed to repurchase the share interest in the Project Company from Xin’an Gas and repay to Xin’ao Gas the full consideration under the Disposal should the Project Company fail to be granted a new concession right (in the form issued by the Ministry of Housing and Urban-Rural Development of the PRC) (the “New Concession Right”) under the new shareholding structure within 2 years after completion of the Disposal.
The Company is pleased to announce that the Project Company has entered into a supplementary contract (the “Supplemental Agreement”) with the Xiangdong District Government of Pingxiang, Jiangxi, the PRC. The Supplementary Agreement states that the New Concession Right for natural gas pipeline distribution (in the form issued by the Ministry of Housing and Urban-Rural Development of the PRC) has been approved and will be granted to the Project Company within 30 days following the signing of the Supplementary Agreement. The New Concession Right grants the Project Company a 30 year pipeline natural gas distribution right, beginning from January 19, 2010 to January 18, 2040. Extension can be applied to the New Concession Right in 15 year increments upon expiration, with no limit on the number of extensions.
Receiving the New Concession Right will discharge Sanya Changfeng of the potential obligation to repurchase its interest in the Project Company.
Working Capital Loan
Sanya Changfeng Offshore Natural Gas Distribution Co., Ltd., a wholly owned subsidiary of Changfeng, has successfully procured a RMB20 million secured short-term loan from Bank of China, Sanya Branch for working capital of its daily operations. This secured loan carries a fixed annual interest rate of 4.35% and will be due for repayment in 12 months.
Ceramic Manufacturer Client in Hebei
The Baoding ceramic manufacturer client of Hebei Riheng Clean Energy Ltd., Co. (“Riheng Energy”), a controlled subsidiary of Changfeng Energy Inc., has declared that its factory will temporarily halt production for the next two months due to operational issues and seasonality.
About Changfeng Energy Inc.
Changfeng Energy Inc. is a Canadian public company currently traded on the Toronto Venture Exchange (“TSX-V”) under the stock symbol “CFY”. It is an integrated energy provider and natural gas distribution company (or natural gas utility) in the People’s Republic of China. Changfeng strives to combine leading clean energy technology with natural gas usage to provide sustainable energy to its customer base in the PRC. In 2009, Changfeng was recognized as being one of China’s Top Ten Most Influential Brands in the Natural Gas Industry.
Corporate Investment Relations
Ann Siyin Lin
VP, Corporate Development
Certain statements contained in this news release constitute forward-looking statements and forward-looking information (collectively, “Forward-Looking Statements”). All statements, other than statements of historical fact, included or incorporated by reference in this document are Forward-Looking Statements, including statements regarding activities, events or developments that the Company expects or anticipates may occur in the future. These Forward-Looking statements can be identified by the use of forward-looking words such as “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “believe” or “continue” or similar words or the negative thereof. No assurance can be given that the plans, intentions or expectations or assumptions upon which these Forward-Looking Statements are based will prove to be correct and such Forward-Looking Statements included in this news release should not be unduly relied upon.
Although management believes that the expectations represented in such Forward-Looking Statements are reasonable, there can be no assurance that such expectations will prove to be correct. Such Forward-Looking Statements are not a guarantee of performance and involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements to differ materially from the anticipated results, performance or achievements or developments expressed or implied by such Forward-Looking Statements. These factors include, without limitation, no significant and continuing adverse changes in general economic conditions or conditions in the financial markets. Readers are cautioned that all Forward-Looking Statements involve risks and uncertainties, including those risks and uncertainties detailed in the Corporation’s filings with applicable Canadian securities regulatory authorities, copies of which are available at www.sedar.com. The Company urges readers to carefully consider those factors.
The Forward-Looking Statements included in this news release are made as of the date of this document and the Company disclaims any intention or obligation to update or revise any Forward-Looking Statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities legislation. This news release does not constitute an offer to sell or solicitation of an offer to buy any of the securities described herein and accordingly undue reliance should not be put on such.
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