Xinjiang Zhundong Petroleum Technology Co, Ltd is restructured as a result of the Zhundong Oil Production Plant under the PetroChina Xinjiang Branch Company. It was registered in the Urumqi high-tech industrial zone on June 29, 2001. It was renamed in December 2003 under the approval of the regional government.

Company name: Xinjiang Zhundong Petroleum Technology Co, Ltd

Address: No1 Zuanshicheng, Urumqi high-tech industrial zone, Xinjiang, China

Registered capital: 74.46 million yuan

Ownership: Non-governmental

Organizational form: joint stock

Industrial sector: petroleum technology service

Business scope: oilfield technology services; instrument and meter maintenance and detection; oil recovery technology consultation; developing technologies to improve the oilfield recovery rate, development and promotion of oilfield new technologies; second-grade general contract of chemical engineering and petroleum engineering construction projects; third-grade housing construction general contracts; second-grade anticorruption and heat preservation engineering contracts; second-grade power transmission engineering contracts; second-grade environment protection engineering contracts; vehicle maintenance and repair (second grade); cargo transportation (fourth grade); pressure pipeline installations (decide concrete projects with qualifications certificate); chemical products (except for special approval); sales of computers and components; accommodation and catering services; highway roadbed contracts (third grade); self-support and agent services for commodity and technology import and export (excluding banned and restricted commodities and technologies); real estate development; refined oil products (restricted only in subordinate gas stations.)

Primary services: well testing, production testing, logging, wax removal, profile control, water plugging, acidification, continuous pipeline operation, oilfield nitrogen new technology application; oilfield management, well exploration management, export of labor service; oilfield construction, power transmission projects, road construction; transportation and property management.

Operational indicators in 2004-2005 Indicator name Unit of measurement 2004 2005 Note Staff workers People 1,098 1,276 Sales revenue 10,000 yuan 17,429 20,950 Year-on-year growth of sales revenue % 31.44 16.81 Total profits 10,000 yuan 3,197 3,500 Total tax 10,000 yuan 1,774 2,200 Total assets 10,000 yuan 20,335 25,636 Total liabilities 10,000 yuan 8,433 11,098 Asset-liability ratio % 41.47 43.29

Indicator name	Unit of measurement	2004	2005
Staff workers	People	1,098	1,276
Sales revenue	10,000 yuan	17,429	20,950
Year-on-year growth of sales revenue	%	31.44	16.81
Total profits	10,000 yuan	3,197	3,500
Total tax	10,000 yuan	1,774	2,200
Total assets	10,000 yuan	20,335	25,636
Total liabilities	10,000 yuan	8,433	11,098
Asset-liability ratio	%	41.47	43.29

Future development: The company will rely on its competitive technologies, comprehensive operation capacity, and market and mechanism advantages to keep a foothold in oilfields and service oilfields. It gives equal attention to petroleum and natural gas businesses to formulate a pattern of taking petroleum technology services as its core focus. Meanwhile, it extends supporting services in oilfield construction, oil and natural gas project management. It will strive to float equities in the stock market in the next two years to expand financing channels for business development.

The company will seize opportunities to develop oilfields in Xinjiang. It will accelerate the purchase of advanced equipment, and expand business scales to industrialize technology achievements and consolidate its leading position in the Xinjiang oilfield market. It will continually expand market shares in and out of the region to tap into the international market.

The company will develop serviceability technologies and domestic and international cooperation to explore technical service fields with high technologies and added values. It will formulate new profit growth points. From 2005 to 2015, the company will keep a foothold in oilfields, serve oilfields, and pay equal attention to petroleum and natural gas businesses. It will change from only supplying technical and labor services to independently developing technologies and producing and selling products.

It will establish a development pattern on the basis of the petroleum technology service and energy products, while tapping the supporting sectors of oilfield project construction and petroleum and natural gas management. It will orient itself to develop into a petroleum technology service expert and energy product supplier. It will carry out the five strategies of technology, talents, brands, capital operation and internationalization. It will specialize on main businesses and grow stronger, and develop into a comprehensive energy industry group integrating the petroleum and natural gas technology development, service, energy product production and sales in west China.

Person-to-contact: Zhao Yun

Tel: 09943837750 (office); 13899631555