Construction with Investment and Management of CNG-LNG Project Contract January 26, 2007
Exhbit
10.12
Construction
with Investment and
Management
of CNG-LNG
Project
Contract
January
26, 2007
This
contract is signed by both parties on January 26, 2007 in Xuancheng
City.
Parties
of this Contract:
People’s
Government of Xuancheng City, Anhui Province
(hereinafter referred to as Party A)
Legal
Representative: Gao Dengbang
China
New Energy Development Investment Company Limited
(hereinafter referred to as Party B)
Legal
Representative: Xxxx Xxxxxxxx
Sinoenergy
Corporation
(hereinafter referred to as Party B)
Legal
Representative: Deng Tianzhou
In
order
to promote local economic development and in accordance with relevant
regulations of Contract
Law of the People’s Republic of China
and
Company
Law of the People’s Republic of China,
both
parties come to an agreement and sign this contract on Party B invest and
construct CNG-LNG project in Xuancheng City upon the principle of mutual benefit
and friendly consultation.
Clause
I Content and Scale of the Project
1.1
Party
A agrees China New Energy Development Investment Company Limited and Sinoenergy
Corporation to collectively invest and construct CNG-LNG (Compressed and
Liquefied Natural Gas) project in Xuancheng City, Anhui Province. Scale of
the
project: annual natural gas processing capacity is 300 million m3,
the
product in initial period is CNG, and the product in future period is LNG.
Target of natural gas is settled by Party B.
1.2
Total
investment of the project is USD 28 million (refer to the Feasibility Research
Report submitted by Party B).
1.3
Party
B makes registration in Industrial and Commercial Administration Bureau of
Xuancheng City to found “Anhui New Energy Company Limited” with registered
capital of USD 5 million in cash.
Clause
II Scope, Price and Payment of Land for Construction
2.1
Party
A transfers a piece of land of 60Mu to Party B at one time (located in Tianhu
Town, Economic Development Zone, Xuancheng City) as industrial land, price
of
transfer is CNY 112,000/Mu (refer to Clause I of the appendix for relevant
contents of the price), and term of use is 50 years. Transfer of the land is
executed in accordance with relevant regulations of China.
2.2
Payment is executed according to the Transfer
Contract of Use Right of State Land
signed
between Party B and Municipal Bureau of State Land and Resources.
Clause
III Schedule of the Project
After
acquiring approval documents and land, construction of this project shall be
started within 12 months and actualized according to the schedule defined in
the
Feasibility Research Report.
Clause
IV Programming and Construction
4.1
Party
A provides land with “Five Connections and One Flatness” for Party B (refer to
Clause II of appendix).
4.2
Party
B must develop and use the land according to the use, term and conditions
regulated in relevant laws and Transfer
Contract of Use Right of State Land.
Party B
can consign designers with relevant qualifications to make programming and
design without violating relevant regulations, and transact capital construction
procedure after being examined and approved by relevant
authorities.
Clause
V Conditions of Construction
Party
A
shall assist to provide basic establishments of electricity and water, etc.
and
road red lines connected to land of the project.
Clause
VI Management and Administration
6.1
Production and management of Party B must comply with relevant laws and
regulations of China, protect state benefits and maintain market order of fair
competition.
6.2
Party
B shall execute relevant laws and regulations on labor protection, protect
legal
rights and benefits of employees, participate in social security system and
support work of relevant associations.
6.3
Party
B shall execute state financial system, submit accountant report forms and
statistic report forms to relevant agencies and accept supervision of relevant
departments of local government.
Clause
VII Environment Protection and Safe Production
7.1
Party
B shall ensure environment protection, fire protection and safe production
to
reach the “Three Simultaneities” during actualizing the project.
7.2
The
project of Party B shall legally fulfill environment appraisal procedure, and
exhaust of the “Three Wastes” shall reach the state standard.
7.3
During construction and production of the project, Party B shall perform fire
protection and safe production strictly according to relevant state regulations
and legally fulfill safety appraisal procedure.
Clause
VIII Rights and Obligations
Party
A:
1.
After
the project is put into production, enterprise income tax enjoys the “Two
Remissions and Three Deductions” policy, and local kept part of value-added tax
and other taxations and fees are executed according to the most preferential
policies of the country and Economic Development Zone of Xuancheng
City.
2.
Party
A shall ensure the right of legal gas management of Party B in Xuancheng
City.
3.
Party
A shall assist Party B on various approvals during construction and management.
Party A shall be responsible for temporary land requisition from the factory
of
Party B to “Deliver Gas of Sichuan to East Part” Xuancheng Substation High
Temperature Pipeline Construction, and Party B shall pay relevant
expenses.
4.
Party
A shall pledge that Party B has adequate independence of management. Party
B
shall have the right to confirm plan of production and management, collect
and
use funds, purchase materials for production, organize production and sell
products.
5.
Party
A shall pledge that Party B has adequate right of labor use. Party B can confirm
setup of department and employees according to requirement of production and
management.
6.
Party
A shall pledge to provide “On-off” services for the project invested by Party B
and settle relevant problems during construction of the project.
Party
B:
1.
Party
B shall pledge that investment of the project is invested on schedule, and
shall
not privately alter invested project without consent of Party A.
2.
Party
B shall pledge to make management and pay taxation legally.
3.
Party
B shall employ employees in accordance with relevant laws and regulations,
legally confirm distribution and level of salaries according to management
and
economic profits, which shall not be lower than the minimum level of Xuancheng
City and pay pension, unemployment insurance, medical insurance, industrial
injury insurance and procreation insurance.
4.
Party
B shall accept administration of Party A and comply with various systems of
administration of Xuancheng City.
Clause
IX Supplement
This
agreement is in 6 original copies, and each party shall keep 3 of them, and
this
agreement shall come into force after being signed and sealed by both
parties.
Appendix:
I.
Explanation on Price of Land
The
price
of the land transferred by Party A is CNY 112,000/Mu, including:
1.
Fees
of approval and certificate;
2.
Price
of Transferred Land (including all land requisition compensations and removing
expenses);
3.
Other
administrative expenses related with land certificates.
II.
Explanation on “Five Connections and One Flatness”
Party
A
shall pledge that the land provided for Party B is in conformity with basic
standard of construction land of development zone.
“Five
Connections” means road (road standard of development zone), electricity (double
loops), water, CATV and telecommunication. “One Flatness” means the land is
backfilled and leveled up according to vertical control.
Party
A:
People’s Government of Xuancheng City, Anhui Province
Representative:
s/
Xxxx Xxxxx
Title:
Administrative Deputy Mayor
Seal:
People’s Government of Xuancheng City
Party
B:
China New Energy Development Investment Company Limited
Representative:
s/
Xxxxxxxxx Xxxx
Title:
Chairman
Seal:
China New Energy Development Investment Company Limited
Party
B:
Sinoenergy Corporation
Representative:
s/
Tianzhou Deng
Title:
Chairman
Seal:
Sinoenergy Corporation
Date:
January 26, 2007
