Honghua Signs RMB 760 Million Construction Agreement with LNG Power Shipping

Further Expands Offshore Business and Optimizes Diversified Business Layout

Aug 10, 2015, 01:31 ET from Honghua Group

CHENGDU, China, Aug. 10, 2015 /PRNewswire/ -- Honghua Group Ltd ("HH") (Stock Code: 196.HK), a leading global land drilling rig manufacturer, is pleased to announce that HH entered into a Shipbuilding Contract with LNG Power Shipping Limited in early August, with an aggregate amount of approximately RMB760 million. According to the contract HH will build and sell 200 sets of LNG power inland river ships with certain specifications including 700-ton ships, 950-ton ships and 1350-ton ships. It is expected to deliver all vessels by the end of September in 2016.

Mr. Zhang Mi, Chairman of HH commented, "The LNG powered ships that HH will build are a new type of environment-friendly transportation vessel, directly responding to the concept of environment protection and energy saving. The LNG powered ships, which are generally used in inland rivers, will greatly reduce the pollution emission during operation, and are not only in line with the 'Green Yangtse River' policy promulgated by the PRC government, but also enable the enterprises to cut fuel costs. By virtue of HH's excellent in-house R&D capability and advanced techniques in offshore engineering equipment manufacture, as well as the competitive edge of the giant 'Honghai Crane' hoisting equipment and offshore base, HH will continue to expand its offshore business and the diversified business layout."        

About HH (Stock Code: 196.HK)
HH is one of the largest land drilling equipment manufacturers in the world, which is primarily engaged in manufacturing conventional land drilling rigs, digital drilling rigs, accessories of drilling rigs, as well as the parts and components for the drilling rigs or for the maintenance of the drilling rigs in operation. Leveraging on the strong R&D strength, high-quality production facilities and mature international sales network, HH's products have been sold to a large number of famous enterprises all over the world, including major oil-production regions such as North America, Middle East, and emerging markets including South America, India, Russia, China, Africa. Meanwhile, the overall construction of the base located in Qidong County, Jiangsu Province progressed well, among which the dock basin project has passed the examination of related departments and the overall lifting of "Honghai Crane" is expected to complete in 2015. Based on the existing solid foundation of the drilling rigs equipment, HH will implement business diversification strategy, and expand to become the integrated enterprise which is involved in the interaction development of three major sectors, including onshore and offshore areas, equipment manufacturing and oil and gas resources development (especially the unconventional oil and gas area), as well as engineering services.

For further information, please contact:

Honghua Group Limited
Ms. Jinny Chen
Tel: (86 28) 6817 6881
Fax: (86 28) 8297 1850
Email: ir@hhcp.com.cn

SOURCE Honghua Group