NO : 1 8
Natural Gas Purchase
Agreement
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Seller:
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Shaanxi Natural Gas Co., Ltd.
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Purchaser:
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Xi'an Xilan Natural Gas Co., Ltd.
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Natural Gas Purchase Agreement
Signed at: Xi’an,
Shaanxi
Seller (Party
A): Shaanxi Natural Gas Co., Ltd.
Purchaser (Party
B): Xi’an Xilan Natural Gas Co., Ltd.
According to
the CONTRACT LAW OF THE PEOPLE’S REPUBLIC OF CHINA, the
MUNICIPAL GAS MANAGEMENT REGULATION, as well as the MUNICIPAL GAS
SECURITY MANAGEMENT REGULATION, to confirm the rights and
obligations of both parties, after negotiation, Party A and Party B
reached the following agreement (‘the
Agreement’).
Article
1 Duration
and Supply
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Duration: From
8 am on December 31, 2007 to 8 am on December 31, 2008.
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Supply:
According to the annual plan of the China Natural Petroleum
Corporation (‘CNPC’) Changqing Natural Gas Company and
the distribution plan of the Shaanxi Development and Reform
Commission, the volume of gas in this contract for the year
2008 will be 25.58 million cubic meters.
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Unit: Million cubic
meters
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Jan.
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Feb.
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Mar.
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Apr.
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May
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Jun.
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Jul.
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Aug.
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Sep.
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Oct.
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Nov.
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Dec.
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1.94
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2.18
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2.53
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1.94
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1.64
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1.83
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1.76
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2.05
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1.99
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2.49
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2.52
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2.71
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3.
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In order to
ensure continuing operation, Party B shall provide the annual gas
usage plan for next year before July 20 2008 and the monthly gas
usage plan before the 20th of each month to Party A in
writing.
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Party B shall
provide timely and accurate market information regarding gas usage
and market development for the efficient and timely communication
between both parties.
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Party B shall
inform Party A of its new users one year in advance. Party B must
obtain approval under Notification No. [2005] 387 by Shaanxi
Development and Reform Commission for natural gas quota. Otherwise,
Party A will not consider the natural gas demand for Party
B’s new industrial users.
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Shaanxi Natural
Gas Supply Contingency Plan No. [2005] 387 shall govern in cases of
gas supply shortage or other emergency, and is attached as exhibit
for this Agreement.
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Selling price
is set according to the relevant documents of Shaanxi Price
Bureau.
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According to
Shaanxi Natural Gas Price Adjustment 31 [2006], the price for
natural gas supplied by Party to Party B is RMB 1.26 per cubic
meter at city gate stations, which includes RMB 0.77 per cubic
meter as base cost and RMB 0.49 per cubic meter as long-distance
pipeline transmission cost.
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During the term
of this contract, in cases of any price adjustments by regulatory
authorities, the new price shall substitute the price currently
agreed by both parties.
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Article
3 Supply
Handover
The handover
place is designated at Party A's Lintong transmission station,
whereby the natural gas ownership as well as corresponding risks
shall be transferred from Party A to Party B.
Natural gas
provided is purified and supplied by the Bureau of Changqing Gas
Purification Plant which satisfies the second level of GB17820-1999
"Gas" Category Standard.
The pressure of
sub-transmission station exit is less than 1.0 MPa.
Article
6 Gas Metering and Transition
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Measurement
standards: the amount of gas shall be measured by
volume, and in compliance with law of the People's Republic of
China's oil and gas industry standard SY/T6143-2004.
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Measurement
condition: the standard temperature to measure the volume of
gas is 293.15K (20 degrees Celsius) with pressure 101.325 Pa (1
standard atmospheric pressure).
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Shall be in
accordance with the calculation standards of Party A’s
Lintong distribution station, it will be monitored by Party
B, and Party A is responsible for the operation of the
measuring instruments.
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Party A shall
provide receipt daily in five copies. After recording and signing
by both parties, these copies will be deemed as proof of
settlement.
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At 8 o 'clock
every morning, Party B will assign staff to record volume of gas
with Party A’s staff at the Lintong station.
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Maintenance of
measuring instruments
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According to
the State regulations, both parties agreed to assess the
meas
