China BlueChemical : CONTINUING CONNECTED TRANSACTIONS P...

If you are in any doubt about this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other independent professional adviser.

If you have sold or transferred all your shares in China BlueChemical Ltd., you should at once hand this circular, together with the enclosed form of proxy and reply slip, to the purchaser(s) or transferee(s) or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

(a joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 3983)

CONTINUING CONNECTED TRANSACTIONS PROPOSED ANNUAL CAPS FOR

CONTINUING CONNECTED TRANSACTIONS AND

NOTICE OF THE EXTRAORDINARY GENERAL MEETING

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

Halcyon Capital Limited

A notice convening the EGM to be held at the Meeting Room, 3rd Floor, Kaikang CNOOC Mansion, No. 15, Sanqu, Anzhenxili, Chaoyang District, Beijing, PRC on Thursday, 28 December 2017 at 10 : 00 a.m. is set out on pages 53 to 55 of this circular.

A reply slip and a form of proxy for use at the EGM (or any adjournment thereof) are enclosed and are also published on the website of the Stock Exchange (www.hkexnews.hk). Shareholders who intend to attend the EGM shall complete and return the reply slip in accordance with the instructions printed thereon before Friday, 8 December 2017. Whether or not you are able to attend the EGM, you are strongly advised to complete and sign the enclosed form of proxy, in accordance with the instructions printed thereon, and to lodge them with the Company's Secretary Office of the Board in China (for holders of domestic shares or unlisted foreign shares) at Room 1707, Kaikang CNOOC Mansion, No. 15, Sanqu, Anzhenxili, Chaoyang District, Beijing, the PRC or the Company's H share Registrar, Computershare Hong Kong Investor Services Limited (for holders of H shares), at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong, as soon as possible and in any event not less than 24 hours before the time appointed for the holding of the EGM (or any adjournment thereof) (i.e., by 10 : 00 a.m. on Wednesday, 27 December 2017). Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM (or any adjournment thereof) should you so wish.

* For identification purpose only

13 November 2017

Page

DEFINITIONS ... ....... ........ ....... ....... ........ ....... ........ ....... ....... 1

LETTER FROM THE BOARD . ....... ....... ........ ....... ........ ....... ....... 6

LETTER FROM THE INDEPENDENT BOARD COMMITTEE 23

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER 24

APPENDIX - GENERAL INFORMATION 50

NOTICE OF THE EXTRAORDINARY GENERAL MEETING 53

In this circular, the following words and expressions shall, unless the context otherwise requires, have the following respective meanings:

''Board'' the board of Directors

''CBRC'' 中國銀行業監督管理委員會 (China Banking Regulatory Commission)

''CNOOC'' 中國海洋石油集團有限公司 (原中國海洋石油總公司) (China National Offshore Oil Corporation*), a state-owned company established in China which is also the controlling shareholder of the Company

''CNOOC China Limited''

中海石油（中國）有限公司 (CNOOC China Limited*), a company

established in China and a wholly-owned subsidiary of CNOOC Limited

''CNOOC Fudao'' 海洋石油富島有限公司 (CNOOC Fudao Limited*), a company

established in the PRC and is currently a wholly-owned subsidiary of the Company

''CNOOC Group'' CNOOC and its associates, excluding the Group

''CNOOC Jiantao'' 中海石油建滔化工有限公司 (CNOOC Kingboard Chemical Limited*), a company established in China and the equity interest of which is owned as to 60% by the Company and 40% by Kingboard Investments Limited

''CNOOC Leasing'' 中海油國際融資租賃有限公司 (CNOOC International Financial Leasing Limited*), a company incorporated in the PRC with limited liability and a wholly-owned subsidiary of CNOOC

''CNOOC Limited'' 中國海洋石油有限公司 (CNOOC Limited*), a company listed on the Stock Exchange (Stock Code: 0883) and the New York Stock Exchange (Stock Code: CEO) and a subsidiary of CNOOC

''Company'' 中海石油化學股份有限公司 (China BlueChemical Ltd.*), a company incorporated in the PRC and a subsidiary of CNOOC, the H shares of which are listed on the Stock Exchange

''Comprehensive

Services and Product Sales Agreement''

the comprehensive services and product sales and purchase framework agreement dated 3 November 2017 entered into between the Company and CNOOC

''CPI'' Consumer Price Index

''Director(s)'' director(s) of the Company

''Dongfang 13-2 Gasfield Group

Natural Gas Sale and Purchase Agreement''

the Dongfang 13-2 gasfield group natural gas sale and purchase agreement finalized and signed on 3 November 2017 among the Company, CNOOC Fudao and CNOOC China Limited

''EGM'' the extraordinary general meeting of the Company to be held at 10 : 00 a.m. on Thursday, 28 December 2017 at the Meeting Room, 3rd Floor, Kaikang CNOOC Mansion, No. 15, Sanqu, Anzhenxili, Chaoyang District, Beijing, the PRC to be convened, among other things, for the Independent Shareholders to consider and, if thought fit, approve the agreements in relation to certain continuing connected transactions and the Proposed Caps as set out in this circular, and any adjournment thereof

''Finance Lease Agreement''

the finance lease framework agreement dated 3 November 2017 entered into between the Company and CNOOC Leasing

''Four Major Types of Crude Oil''

the four types of crude oil referred to in Dongfang 1-1 Offshore Gasfield Natural Gas Sale and Purchase Agreement, Natural Gas Sale and Purchase Framework Agreement and Ledong Natural Gasfield Natural Gas Sale and Purchase Agreement entered into between the Company and CNOOC China Limited and Dongfang 1-1 Offshore Gasfield Natural Gas Sale and Purchase Agreement entered into between CNOOC China Limited and CNOOC Jiantao mean West Texas Intermediate

Crude Oil (西德克薩斯中質原油), Tapis Crude Oil (塔皮斯原油),

Brent Crude Oil (混合布倫特原油) and Minas Crude Oil (米納斯

原油)

''Fudao Phase I Urea Plant''

the Company's urea plant with a 520,000-tonne annual capacity in Hainan

''Fudao Phase II Urea Plant''

the Company's urea plant with an 800,000-tonne annual capacity in Hainan

''Group'' the Company and its subsidiaries from time to time

''Hainan Phase I Methanol Plant''

the Company's methanol plant with a 600,000-tonne annual capacity in Hainan

''Hainan Phase II Methanol Plant''

the Company's methanol plant with an 800,000-tonne annual capacity in Hainan

''Hainan Plants'' Fudao Phase I Urea Plant, Fudao Phase II Urea Plant, Hainan Phase I Methanol Plant and Hainan Phase II Methanol Plant

''Hong Kong'' the Hong Kong Special Administrative Region of the PRC