Hong Kong, July 20, 2010 - Oil and gas company Sino Oil and Gas Holdings Limited (“Sino Oil and Gas Holdings”, formerly ‘Genesis Energy Holdings Limited’, HKEx: 702) announces that the company signed a legally non-binding memorandum of understanding on July 26, 2010 with Kenwin Global Limited (“Kenwin”), an independent third party, for the acquisition of 90% interest in a production sharing contract owned by Kenwin in an oil field located in Jinzhuang District, Ganquan County in Shaanxi Province (“Jinzhuang Oilfield”). The consideration of the acquisition would not exceed HK$500 million.

Jinzhuang Oilfield is located in the hinterland of the Ordos Plateau and has a site area of 62 sq km. The oil field currently has 68 producing wells with daily crude oil production of more than 30 tonnes. Based on preliminary geological review by an independent valuer in the PRC, the 3P (the aggregate of the proved, probable plus possible) reserves of oil in Jinzhuang Oilfield would not be less than 25 million tonnes.

Pursuant to the MOU, conditions precedent of the acquisition include the Company having received a competent person’s report and a valuation report in compliance with the requirements of the Listing Rules of Hong Kong, and in form and substance satisfactory to the Company stating that the 3P reserves of oil in the Jinzhuang Oilfield being not less than 25 million tonnes; and that the valuation of Kenwin not less than HK$600 million.

Sino Oil and Gas Holdings Executive Director Dr. Dai Xiaobing stated: “Jinzhuang Oilfield is a producing field with minimal exploration work required. The preliminary review indicates rich crude oil resources for the oil field, supporting management’s confidence in ramping up the annual oil production to 10,000 tonnes in future. Furthermore, the zone is found to be surrounded by numerous tight gas (non-conventional natural gas) resevoirs. Exploration for the tight gas reserves of Jinzhuang Oilfield is now ongoing, with possible major breakthroughs in this area in future.”

Dr. Dai continued: “Further to our advance into the CBM domain, we will continue to focus on expanding our oil and gas businesses in the Ordos Basin. This planned acquisition is close to the Liuluoyu Oilfield which the Group acquired in early 2009. The new acquisition will aid our plan to integrate our oil and gas businesses in the area in order to achieve an operational scale with greater efficiency and synergistic benefits.”

About Sino Oil and Gas
Sino Oil and Gas Holdings Limited (HKEx: 702) is an energy company with a key focus on oil and gas. The Group is committed to building a portfolio of oil and gas assets and operations with an aim to develop into one of the leading independent oil and gas companies in Greater China. The Group currently operates oil and gas fields in the PRC and the US.

Issued by :
Sino Oil and Gas Holdings Limited

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