[新聞稿] Press Release Huarong Energy announces 2015 interim results

(28 August 2015, Hong Kong) - China Huarong Energy Company Limited ("Huarong

Energy", the "Company" or "We", and together with its subsidiaries, the "Group"; stock code:

01101.HK) announces its 2015 interim results today. For the Period, the Group recorded revenue of RMB379.1 million, while loss attributable to the equity holders of the Company was narrowed to RMB2,035.8 million for the Period compared to the same period of last year.
Due to the profound impact of the slowdown in global economic growth and overcapacity in the shipping industry, shipbuilders were still confronted with numerous challenges in production and operations in the first half of 2015. For the Period, we delivered 4 vessels with a total volume of 1,031,000 DWT. It included 1 very large ore carrier, 2 Suezmax crude oil tankers and
1 very large crude oil carrier. It is expected that the shipping market is unlikely to be recovered from overcapacity in the near future. China's shipbuilding industry will accelerate its transformation and will generally enter into an industrial structure adjustment stage.
In September 2014, we completed the acquisition of 60% interests in the Kyrgyzstan Project. In view of the low costs and stable local oil prices in Kyrgyzstan, we are of the view that under the current adverse market conditions of the shipbuilding industry, exposure to the energy sector will enable us to diversify our operations and broaden our source of revenue, as well as drive our active transformation from a manufacturer to a supplier in the energy service sector, thereby enhancing contributions to the overall interests of our shareholders.
As at 30 June 2015, we had successfully completed construction of 42 wells out of which 6 wells were production wells. For the Period, the Kyrgyzstan Project recorded 30,563.2 barrels (bbl) of light crude oil. Central Asia is a region subject mainly to the influence of Russia, whose export oil prices have not plunged in tandem with international oil prices. Local domestic oil prices of Kyrgyzstan have not changed significantly despite the dramatic decline in international oil prices. We aim to further optimise the sales channel of the Kyrgyzstan Project and mitigate the effect of international oil price fluctuation by establishing sales agreements with large
refineries.

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Huarong Energy announces 2015 interim results

28 August 2015 / P.2

On 20 July 2015, APEX Reservoir Service, Inc., an independent competent evaluator (the "Independent Evaluator"), has issued a petroleum reserve report (the "Reserve Report") for the three oilfield zones (namely Maili-Su IV, Eastern Izbaskent and Izbaskent) (the "Evaluated Zones") in the Kyrgyzstan Project with a base date of evaluation of 31 May 2015. The proved (1P) recoverable reserves of the Evaluated Zones in the Kyrgyzstan Project were approximately
24.39 million tons, whereas the proved plus probable (2P) recoverable reserves were approximately 50.54 million tons. The Reserve Report supports the view of the Group that the Evaluated Zones have favourable development potential and value. The Group will accelerate the pace of new well development and enlarge the scope of well fracturing in order to realise the development potential of the Kyrgyzstan Project. In light of China's "Belt and Road Initiative", we will establish a closer strategic cooperation relationship with well-established energy companies and strive for its growth in the energy industry.

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For press enquiries: China Huarong Energy Company Limited

Mr. Michael Cheng Tel: (852) 3900 1822 Email: michaelcheng@rshi.cn

iRregular Consulting Limited

Ms. Catherine Tsang Tel: (852) 3568 0986 Email: catherinetsang@irregularconsulting.com

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