CNG
      Sales Contract

    


    Seller:
      Huabei Oilfield Branch Company of PetroChina Company Limited.

    


    Legal
      Representative:

    Authorized
      Agent:

    Bank:
      Huabei Oilfield Branch, Industrial & Commercial Bank of China

    Account
      No.: 0408004009221009311

    Tel:0317-2729894


    


    Buyer:
      Beijing Zhong Ran Wei Ye Gas Co., Ltd.

    


    Legal
      Representative:

    Authorized
      Agent:

    Bank:

    Account
      No.:

    Tel:

     

    Signatory
      Location: 
      Renqiu,
      Hebei Province

    


    Date:
      January, 12, 2007

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    Table
      of
      Contents

    


    
      	
              1.

            	
              Definitions

            


    

    
      	 	 


      	
              2.

            	
              Delivery
                Point, Delivery Mode and Pressure

            


      	 	 


    

    
      	
              3.

            	
              Period,
                Quantity and Monthly Plan of Gas
                Supply

            


    

    
      	 	 


      	
              4.

            	
              Quality

            


      	 	 


    

    
      	
              5.

            	
              Measurement

            


    

    
      	 	 


      	
              6.

            	
              Nature
                and Scope of Gas Consumption

            


      	 	 


    

    
      	
              7.

            	
              Price
                and Adjustment

            


    

    
      	 	 


      	
              8.

            	
              Inspection

            


      	 	 


    

    
      	
              9.

            	
              Settlement
                and Payment

            


    

    
      	 	 


      	
              10.

            	
              Exemption
                Conditions and Determination

            


      	 	 


    

    
      	
              11.

            	
              Liabilities
                for Breach of Contract

            


    

    
      	 	 


      	
              12.

            	
              Amendment,
                Transfer and Cancellation of Contract

            


      	 	 


    

    
      	
              13.

            	
              Effectiveness
                of Contract

            


      	 	 


    

    
      	
              14.

            	
              Dispute
                Settlement

            


    

    
      	 	 


      	
              15.

            	
              Miscellaneous

            


    

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    This
      Contract is made by and between PetroChina Huabei Oilfield Company (hereinafter
      called the Seller) and Beijing Zhong Ran Wei Ye Gas Co., Ltd. (hereinafter
      called the Buyer), for the sale and purchase of natural gas.

    


    In
      accordance with The
      Contract Law of the People's Republic of China,
      with a
      purpose to clarify rights and obligations for Party A and Party B, to build
      an
      equal trading relationship, and to supply and use natural gas in a safe,
      economic, stable and reasonable manner, after considering the Seller’s current
      production and supply of natural gas as well as the Buyer’s current facilities
      and consumption, the Seller agrees to supply natural gas to the Buyer and the
      Buyer agrees to use gas and make payment, according to the terms and provisions
      hereinafter set forth in this Contract, through friendly
      consultation.

    


    
      
        1.
          Definition
          

      

    

    


    For
      the
      purposes of this Contract, the following terms and phrases shall have the
      meaning and interpretation given herein.

     

    Natural
      Gas
      shall
      mean a mixture of combustible gases formed and moved under various geological
      conditions and kept underground under certain pressure, consisting primarily
      of
      methane. 

     

    Standard
      Conditions
      shall
      mean an environment with a temperature of 20 degrees Celsius (293.15K) and
      an
      absolute pressure of 101.325 kPa(standard atmospheric pressure).

     

    Standard
      Cubic Meter
      shall
      mean the quantity of natural gas, which at standard conditions, occupies the
      volume of one cubic meter.(referred to as “cubic meter”in this
      Contract)

     

    Period
      of Gas Supply shall
      mean the period from the day gas supply commences to the day it terminates, as
      agreed in this Contract.

     

    Contract
      Gas Amount
      shall
      mean the yearly, monthly and daily gas amount as agreed between the two Parties
      under this Contract.

     

    Annual
      Contract Gas Amount
      shall
      mean the amount of gas supply and consumption for a year as agreed under this
      Contract during the period of gas supply.

     

    Monthly
      Contract Gas Amount
      shall
      mean the amount of gas supply and consumption for a month as agreed under this
      Contract during the period of gas supply.

     

    Daily
      Contract Gas Amount
      shall
      mean the average daily gas amount, after excluding the number of inspections
      days and gas consumption on inspection days. 

     

    Delivery
      Point shall
      mean the place where the Seller delivers and measures, and the Buyer receives
      CNG, which is also the place where the ownership and risk of CNG is shifted
      to
      the Buyer. 

     

    1.10
      Delivery
      point Pressure
      shall
      mean the instantaneous pressure at the natural gas delivery measuring
      instruments.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1.11
      Gas
      Quality shall
      mean the quality standards of natural gas as agreed in this Contract.


     

    1.12
      The Seller’s
      Gas Production and Transmission Facilities
      shall
      mean the Seller’s gas wells, well
      site
      facilities, cleaning facilities, pipelines and networks, and other facilities
      necessary for gas production, treatment, transmission, delivery and measurement,
      all the way to delivery point.

     

    1.13
      The
      Buyer’s Gas Consumption Facilities
      shall
      mean the Buyer’s facilities necessary for gas transmission, treatment, and
      consumption from delivery point to gas consumption point. 

     

    1.14
      Nature
      of Gas Consumption
      shall
      mean the Buyer’s specific purposes for gas consumption.

    


    
      
        2.
          Delivery
          Point, Delivery Mode and Pressure

      

    

    


    2.1
      Delivery point is the off-take joint after the delivery measuring instruments
      at
      the CNG station of Fourth Oil Extraction Plant. 

     

    2.2
      The
      Seller delivers natural gas to the Buyer at the delivery point through
      pipelines. Ownership and risk of natural gas thus is shifted to the
      Buyer.

     

    2.3
      The
      Buyer adopts the __first__ method among the following to transport
      CNG.

     

    2.3.1
      Transportation by the Buyer’s vehicle

     

    2.3.2
      Transportation by the Seller’s vehicle

    


    3.
      Period, Quantity and Monthly Plan of Gas Supply

    


    3.1
      Period of Gas Supply: from 0:00 AM of January 12, 2007 to 12:00 PM of December,
      31, 2007. 

     

    3.2
      Gas
      Amount

     

    3.2.1
      In
      accordance to the Seller’s production and supply as well as the Buyer’s demand,
      both Parties agree the gas amount of natural gas during the supply period under
      this Contract, i.e. annual contract gas amount shall be 10million cubic
      meters.

     

    3.3
      The
      Seller shall provide stable gas supply to the Buyer as agreed in this Contract,
      and the Buyer shall use gas in a stable manner and make payment on time as
      agreed in this Contract.

     

    3.4
      Should the User still needs to increase gas consumption after the annual
      contract gas amount has been consumed, the Seller shall try to meet the Buyer’s
      demand, if it is possible through production growth or adjustment. 

     

    3.5
      Monthly Gas Supply Plan

     

    3.5.1
      The
      Seller shall arrange its natural gas production and the Buyer shall arrange
      its
      natural gas consumption both in a balanced manner, based on the gas amount
      agreed in this Contract. 

     

    3.5.2
      While securing the annual contract gas amount, the Buyer can make proper
      adjustment to monthly gas supply plans provided by the Seller, according to
      its
      production and consumption situation. But adjustment to daily gas amount, in
      principal, shall be within ±10% of daily average contract amount (exemption
      conditions in this Contract not included).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    3.6
      The
      Buyer shall provide the Seller with gas consumption demand plans for next month
      in writing before the 15th
      day of
      the current month, based on the abovementioned principal. The Seller shall,
      upon
      receiving such written notice for adjustment, reply within 10 days, otherwise
      the Seller shall be deemed as having accepted the Buyer’s request. If the Buyer
      does not provide demand plan for next month, the Seller shall make gas supply
      arrangement according to production and network situation, while securing annual
      contract gas amount, as agreed in this Contract. 

    


    4.
      Quality 

    


    4.1
      During the term of this Contract, the quality of gas provided by the Seller
      to
      the Buyer shall meet the standards of Category
      natural
      gas set forth in GB17820-1999 Natural Gas, the national standards of the
      People’s Republic of China.

    


    5.
      Measurement

    


    5.1
      In
      accordance with the
      Metrology Law of The People’s Republic of China
      and
Gas
      Plan (1987) No.2001 the Interim Measures Governing Natural Gas Commodity,
measurement
      of natural gas shall be based on the Seller’s measurement value at delivery
      point.

     

    5.2
      Natural gas shall be measured in volume.

     

    5.3
      Measuring instruments shall be installed, adjusted and tested according to
      relevant national standards and regulations.

     

    5.4
      Should the Buyer have any objection to the measurement value, the Buyer shall
      inform the Seller in writing within 5 days upon receiving settlement sheet
      or
      payment invoice, and such dispute shall be resolved through consultation. Should
      such consultation fail, the Buyer can apply to government-authorized testing
      institutions for tests on the Seller’s natural gas delivery measuring
      instruments. Should the Seller fail such tests, the Seller shall be liable
      for
      the testing cost; should the Seller pass such tests, the Buyer shall be liable
      for the testing cost. 

     

    5.5
      Before the settlement of such disputes, the Buyer shall make payment based
      on
      the Seller’s measurement. The Buyer shall not refuse to pay. Adjustment shall be
      made after such dispute is resolved. The standard and method of adjustment
      is:
      should the Seller’s measuring instruments fail to meet standards, payment shall
      be made according to the average measurement value of ten days before such
      dispute; should the Seller’s measuring instruments meet standards, payment shall
      be made according to the Seller’s actual measurement value.

     

    5.6
      Management and Adjustment of measuring instrument at delivery point. The
      Seller’s measuring instruments at delivery point shall be managed and maintained
      by the Seller. Such measuring instruments shall be tested regularly in
      accordance with national testing regulations. The Buyer has custodial right
      over
      the Seller’s delivery measuring instruments. When the Seller carries out testing
      on its measuring instruments, the Buyer can send personnel with relevant
      measurement testing qualifications to supervise, but specific operation shall
      be
      implemented by the Seller’s personnel.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    6.
      Nature
      and Scope of Gas Consumption

    


    6.1
      Nature of Gas Consumption: Industrial and civil gas consumption.

     

    6.2
      Scope
      of Gas Consumption: Beijing, Tianjin and Hebei.

    


    7.
      Price
      and Adjustment 

    


    7.1
      Gas
      price for CNG as agreed by now: RMB 1.65 per cubic meter from January 12 to
      March 31; RMB1.65 per cubic meter from January 1 to December 31; RMB 1.55 per
      cubic meter from April 1 to October 31.

     

    7.2
      During the term of this Contract, should the price of natural gas be adjusted
      by
      the government, gas price shall adopt the new price since the day of adjustment.
      

    


    8.
      Inspection

    


    8.1
      Both
      Parties shall cooperate with planned or interim inspections of natural gas
      production, transmission and supply facilities. Changes or fluctuations of
      gas
      supply or consumption due to regular or interim inspections shall be controlled
      within a reasonable range. No liabilities shall be incurred from impact on
      gas
      supply and consumption due to such inspections.

     

    8.2
      Simultaneous Planned Inspection

     

    8.2.1
      According to the Seller’s inspection plan for natural gas production and
      transmission facilities, the Buyer shall cooperate and carry out inspection
      during the Seller’s inspection period. During the Seller’s inspection, should
      the Buyer refuse to decrease or suspend gas supply, the Seller can only supply
      gas according to actual production and transmission capacity during such
      periods. The Seller shall not be liable if gas pressure, quantity or quality
      fail to meet agreements in this Contract or any other events thus incurred.
      

     

    8.3
      Interim Inspection 

     

    8.3.1
      Should any Party need to suspend gas supply for interim inspection due to safety
      hazards, transformation or pipe touching in gas wells, supply and consumption
      facilities, or pipeline and network, such Party shall inform the other Party
      in
      writing or by phone, so that the other Party can make necessary preparation.
      The
      other Party shall give support during such period.

    


    9.
      Settlement and Payment

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

      9.1
        With
        the purpose to ensure that the Buyer can use natural gas in a stable and
        safe
        manner, and the Seller can receive payment, the Parties agree to adopt the
        following methods for settlement and payment.

    

     

    9.2
      The
      Buyer pays a deposit of RMB 960,000 (Say: Nine hundred and sixty thousand)
      for a
      period of 15 days once at a time. The total contract price is RMB 16,000,000
      (Say: sixteen million). 

     

    9.3
      Payment shall be made based on the measurement value at the delivery
      point.

     

    9.4
      The
      Seller can notify the Buyer to pay deposit for the next period in writing or
      by
      phone 5 days before the present period ends. The Buyer shall pay deposit for
      the
      next period before the current period ends (should there be remaining deposit
      from previous period, the Buyer shall make up full deposit for one period).
      If
      the Seller does not receive the Buyer’s deposit for the next period, the Seller
      has the right to suspend gas supply without noticing the Buyer when the Buyer’s
      deposit has been consumed. The Buyer shall bear all liabilities and losses
      thus
      incurred. 

     

    9.5
      Method of Payment: before each settlement period ends, the Buyer shall pay
      deposit for the next period through bank transfer or cheque to the Seller’s bank
      account as agreed in this Contract. Without written approval from the Seller,
      the Buyer shall not change the Seller’s bank account or account number, as
      agreed in this Contract.

     

    9.6
      Time
      of Payment 

     

    After
      this Contract is signed into effect, the Buyer shall make the first payment
      to
      the Seller’s account before January 12, 2006. For the following payments, the
      Buyer shall pay deposit for the next period before the previous period ends.
      If
      the Seller does not receive deposit for the next period, it shall have the
      right
      to suspend gas supply when the Buyer’s deposit has been consumed.

     

    9.7
      Either Party shall have the right to check the other Party’s measurement curve,
      document records and other materials necessary to verify the correctness of
      statements and invoices. Any statement, invoice or payment, if there is no
      objection within 2 years since the submission of statement, providing of invoice
      or settlement of payment, shall be final.

    


    10.
      Exemption Conditions and Determination 

    


    10.1
      Exemption conditions under this Contract refer to conditions which can exempt
      the Parties from liabilities for breach of contract, including Force Majeure
      and
      other exemption conditions agreed between the Parties.

     

    10.2
      Force Majeure shall mean objective situations which are unforeseeable,
      unavoidable or insurmountable, including but not limited to earthquake, land
      slide, flood, hurricane, war, riot, etc. 

     

    10.3
      Other exemption conditions: accidents occur to the Seller’s gas production and
      transmission facilities and the Buyer’s gas consumption facilities, with a
      precondition that such Party has adopted some reasonable measures which still
      can’t prevent, avoid or eliminate such accidents. 

     

    10.4
      In
      cases of situations as described in 10.2 and 10.3, the Claiming Party shall
      promptly inform the other Party, and both Parties shall take active measures
      to
      minimize losses. The Claiming Party shall provide the other Party with effective
      written documents within 5 days after such event happens. If the other Party
      needs to verify the situation, it shall request within 5 days since it receives
      such written documents, otherwise, it shall been deemed as having recognized
      the
      documents.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    11.
      Liabilities for Breach of Contract

    


    11.1
      The
      Seller’s liabilities for breach of Contract

     

    11.1.1
      If
      this Contract is prevented entirely from being enforced, due to the Seller’s
      reasons (excluding exemption conditions under this Contract), the Seller shall
      pay 0.1% of annual contract payment to the Buyer as penalty.

     

    11.2
      The
      Buyer’s liabilities for breach of Contract

     

    11.2.1
      If
      this Contract is prevented entirely from being enforced, due to the Buyer’s
      reasons (excluding exemption conditions under this Contract), the Buyer shall
      pay 0.1% of annual contract payment to the Seller as penalty.

     

    11.2.2
      Should the Buyer fail to make full payment on the payment day as agreed in
      9.6,
      the Buyer shall pay a late payment penalty of 0.3‰ per day, which shall be
      accumulated daily from the day of delayed or partial payment to the day when
      the
      full payment and penalty is settled by the Buyer.

    


    12.
      Amendment, Transfer and Cancellation

    


    12.1
      Amendment: amendment to the Contract shall be made in written forms through
      consultation.

     

    12.2
      Transfer: without written approval from the other Party in advance, neither
      Party shall transfer all or part of its rights and obligations under this
      Contract to a third Party. 

     

    12.3
      Cancellation: in the following cases, this Contract shall be terminated in
      advance:

     

    12.3.1
      Both Parties agree to the cancellation, which does not harm national or social
      public interests.

     

    12.3.2
      One Party breaches the Contract, which makes it impossible or meaningless to
      continue the implementation of this Contract. 

     

    12.3.3
      The Buyer can not pay deposit, and the Seller has suspended gas supply for
      3
      months as agreed in this Contract, the Seller thus has the right to cancel
      this
      Contract unilaterally.

     

    12.3.4
      Force Majeure event defined under this Contract has lasted for 90 days, or
      Force
      Majeure event or situation severely affects the Buyer’s or the Seller’s
      implementation of its obligations in this Contract, which make it impossible
      to
      realize the purpose of this Contract.

     

    12.4
      After the cancellation of this Contract, the parties still have the right to
      pursue the breaching party’s liabilities. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    13.
      Effectiveness 

    


    13.1
      This
      Contract shall enter into force when duly signed and sealed by the authorized
      representatives of both Parties. It shall expire when both Parties’ rights and
      obligations have been fully performed. 

     

    13.2
      As
      for the matters not covered under this Contract, both Parties shall negotiate
      supplementary provisions in written forms, which shall enter into force when
      signed and sealed by authorized representatives of both Parties. 

    


    14.
      Settlement of Disputes

    


    14.1
      During the term of this Contract, should any dispute arise, the Parties shall
      promptly resolve through consultation. Should such consultation fail,
      the_second
      method
      among the following shall be adopted:

     

    
      	
              14.1.1

            	
              Disputes
                can be submitted for arbitration to be arbitraged in accordance with
                currently effective arbitration rules. Such result shall be final,
                with
                binding effect on both Parties. 

            


      	 	 


    

    
      	
              14.1.2

            	
              Disputes
                can be taken to the People’s Court of the Seller’s region to be ruled
                according to law. 

            


    

    


    
      
        15.
          Other
          Agreements

      

    

    


    From
      the
      day when this Contract is signed to 3 years after its term dues (the
      confidential period), all terms and relevant information under this Contract
      shall be kept confidential in accordance with this provision. Without written
      approval from the other Party in advance, neither Party shall reveal terms
      and
      information of this Contract to a third Party within such period, nor to reveal
      or disclose any material and data gained from the other Party.

     

    Other
      Provisions:

     

    According
      to laws and regulations, the Buyer shall make regular and irregular inspection,
      maintenance and overhaul on natural gas transmission facilities, shall establish
      mature safety management mechanism, to ensure the safety of the Seller’s and the
      Buyer’s facilities. 

     

    Should
      any damage or loss occur to the Seller’s facilities and personnel at the station
      due to failures in the Buyer’s equipment and facilities, or due to the Buyer’s
      personnel, the Buyer shall be liable for compensation. 

     

    Both
      the
      Seller and the Buyer shall strictly comply with safety operation regulations
      for
      petroleum and natural gas, equipped with all types of safety protection
      facilities. Operation against regulations is strictly prohibited. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Should
      the gasification mining area of Gas Bureau under CNPC Huabei Petroleum be in
      urgent need of CNG supply, the Buyer shall first ensure the gas supply to such
      gasification mining area.

     

    This
      Contract is prepared in six originals. The Seller holds four originals and
      the
      Buyer holds two originals. 

     

    Appendix:
      the following appendixes are indispensable parts of this Contract. Such
      appendixes shall have the same effect and force as this Contract.