OREANDA-NEWS. November 17, 2014. Phoenitron Holdings Limited, through its subsidiary Shanghai Phoenitron Petroleum & Chemical Company Limited, has signed a Letter of Intent with Jiangsu Huagang Gas Company Limited, a company indirectly controlled by Kunlun Energy Company Limited, for collaboration in certain areas in the Yangtze River Delta economic zone in China.

The cooperation includes the supply of liquefied natural gas (LNG), capital, professional techniques and the promotion of relations with local governments and customers.

Terms of agreement

The Letter of Intent is to be valid for a term of three years. According to the Letter of Intent, it has been agreed that:

Jiangsu Huagang is to leverage its advantages over its stable source of LNG from PetroChina, as well as its own capital resources and technical expertise.

Shanghai Phoenitron is to utilise its established network with local governmental authorities and major customers. Both parties are to cooperate in the development and the establishment of LNG gas stations and the direct supply of LNG to industrial users in the Yangtze River Delta economic zone.

Jiangsu Huagang is to ensure a stable supply of LNG to Shanghai Phoenitron's development projects, and Shanghai Phoenitron is to be responsible for the local LNG market development and project management and operation.

The sourcing of LNG supply for the projects conducted by Shanghai Phoenitron is to be coordinated by Jiangsu Huagang. Individual supply contracts are to be entered into between Jiangsu Huagang and Shanghai Phoenitron for each development project.

 Jiangsu Huagang can provide gas station facilities and technical staff, and is to offer LNG at a discounted price to Shanghai Phoenitron.