Hangzhou Gas Pipeline System

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In May 2005, The Hangzhou Gas (Group) Co., Ltd., Shell (China) Ltd., Shell China B.V. and The Hong Kong and China Gas Co., Ltd. (Towngas) signed a joint venture contract to construct, operate and management a high pressure natural gas pipeline system in Hangzhou. The project included a 117 kilometers pipeline and two natural gas city gate stations. The estimated cost of the project was US$ 91 million (RMB 750 million) The project company was owned by state owned Hangzhou Gas (Group) Co. Ltd. with 51%, Shell (39%) through its subsidiaries Shell China Ltd. and Shell China B.V., and Hong-Kong based Towngas with 10%. Construction work on the project started 2004 with 18 kilometers of pipeline and one city gate station completed. In May 2005, the city gate station and nine kilometers of the completed pipeline had been put into operation, supplying 150,000 cubic meters of gas per day to 190,000 families and some commercial users in Hangzhou. The project was expected to be completed in 2008 and be operated at its capacity of 600 million cubic meters of gas per year in 2010.