According to public information, Shanghai has been in contact with Shenneng group, a subsidiary of Shanghai SASAC. Shenneng group owns Shanghai No.5 ditch LNG terminal and Shanghai Yangshan Port LNG terminal. After the completion of capital increase and share expansion, Tianhong gas will purchase LNG from Shanghai Jiulian every year.
Prior to this capital increase and share expansion, Datong gas and Shanghai Jiulian signed a strategic cooperation memorandum. According to the memorandum, in addition to Shanghai Jiulians share in Tianhong gas by way of capital increase, both parties will choose the opportunity to carry out equity cooperation in other energy industries and projects in the future. Shanghai Jiulian uses its own gas source advantages to ensure that Datong gas or its related parties can supply sufficient LNG in East China Datong gas or its related parties purchase LNG from Shanghai Jiulian; the two sides have complementary cooperation opportunities in gas supply and investment of distributed energy projects; the two sides can cooperate in large-scale projects such as gas power plants and urban peak shaving.