Bolstering the development of oil product business in the post-pandemic era
HONG KONG SAR – Media OutReach – 30 December 2022 – Yanchang Petroleum International Limited (“Yanchang Petroleum International” or the “Company”; stock code: 346.HK) is pleased to announce its subsidiary Henan Yanchang Petroleum Sales Co., Limited (“Henan Yanchang”) will enter into a new supply agreement with Shaanxi Yanchang Petroleum (Group) Co., Limited (“Yanchang Group”). The agreement has been approved by its shareholders at the Special General Meeting held today. Pursuant to which, Yanchang Group will supply refined oil and by-products to Henan Yanchang for three years ending 31 December 2025.
Henan Yanchang entered into a three-year supply agreement with Yanchang Group in 2019. The new agreement will maintain a reliable supply source to enhance the flexibility of business operations. As the economy in the PRC will gradually recover in the post-pandemic era, the Company expects that product demand will shortly return to the pre-pandemic level and the uptrend to continue. The Company believes that the scale of the oil product sales business in the PRC can be further expanded with the stable product supply, strengthening the Group’s profitability.
Mr. Feng Yinguo, Chairman of Yanchang Petroleum International, said, “Yanchang Group is one of the four largest state-owned oil and gas enterprises in the PRC. The new supply agreement will provide greater growth momentum for the Company’s oil product sales business in China. Going forward, the Company will continue to optimize the business of Henan Yanchang and further plan and expand its sales network, in order to expand the overall scale of the Company’s business and increase its competitiveness, creating greater value for our shareholders.”
Yanchang Group is the substantial shareholder of Yanchang Petroleum International, holding approximately 69.19% of the existing issued share capital of the Company. Henan Yanchang is an indirect non-wholly owned subsidiary of the Company, principally engaged in the business of wholesale, retail, storage and transportation of refined oil and by-products.
