FY2011 Annual Results Briefing29 June 2011

Emerging intoProsperity

TABLE OF CONTENTS

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MANAGEMENTMEMBERS

MANAGEMENT MEMBERS

Mr. Ying Xue Pang – Joint Managing Director & Executive President

Mr. Kevin Zhu – Executive Director & Vice President

Mr. Frank Li – General Manager, IR Department

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MAJOR FY2011 MILESTONES

MAJOR FY2011 MILESTONES

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Acquired 28 city concessions in 11 provinces and territories, including Gansu, Liaoning, Heilongjiang, Guangdong, Guangxi, Jiangxi, Hubei, Hebei, Henan, Shandong and Anhui Provinces and Regions.

Started trial operation of our 7th long distance pipeline project in Chongqing with designed transmission capacity of 2 bn m3.

In March 2011, signed the agreement to acquire Panva Gas, the biggest LPG downstream retailer in China, which owns 450 LPG retail and 220 franchised class III stations and services more than 4m households in 8 provinces and regions. The downstream penetration enables China Gas to:

a. Enjoy additional downstream margin

b. Reduce unit cost of supply

c. Increase sales volume

d. Mitigate price fluctuation risk

OPERATIONAL HIGHLIGHTS FY2011

PIPED GAS SALES VOLUME

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Period Sales Growth – Total

FY11 28.5%

FY10 54.5%

FY09 102.5%

Period Sales Growth – Natural Gas Only

FY11 31.7%

FY10 58.7%

FY09 104.1%

To

tal s

ale

s vo

lum

e (

mill

ion

m3)

NATURAL GAS CONSUMPTION BREAKDOWN

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CustomerSales Volume Growth

in FY11% of Total

Volume

CNG Stations 53.9% 8.5%

Commercial 45.8% 11.1%

Industrial 25.3% 67.6%

Residential 45.0% 12.8%

Na

tura

l ga

s sa

les

volu

me

(m

illio

n m

3)

NATUAL GAS CUSTOMER DATA

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Customer Growth Organic AcquiredFY11

Portfolio TotalChange from

FY10FY10

Portfolio Total

Residential 901,982 339,388 6,078,806 25.7% 4,837,436

Industrial 254 206 1,270 56.8% 810

Commercial 3,680 314 37,470 11.9% 33,476

CNG Stations 14 - 105 15.4% 91

Customer Tariffs (ex-tax) (RMB / m3) FY11 Change from FY10 FY10 FY09

Residential 2.15 14.4% 1.88 1.85

Industrial 2.29 9.6% 2.09 1.97

Commercial 2.35 10.3% 2.13 2.06

CNG Stations 2.72 25.3% 2.17 2.08

DAILY CONSUMPTION & PENETRATION RATE

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Natural gas daily consumption Urban population covered and penetration rate

626.9 1,262.9 1,775.4

5,174.6

7,245.3

9,400.3436.7

1,105.6

1,538.6

617.0

802.8

1185.6

6,855.2

10,416.7

13,900.0

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

FY09 FY10 FY11

Residential Industrial Commercial CNG for Automobiles

50.555.9 59.2

26.6%30.3%

33.4%

0%

5%

10%

15%

20%

25%

30%

35%

40%

0

10

20

30

40

50

60

70

80

FY09 FY10 FY11

Pe

ne

tratio

n R

ate

Unit: ’000 m3 Unit: million

OTHER OPERATIONAL DATA

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FY11 Change from FY10 FY10 FY09

Residential Connection Fee (RMB per customer) 2,454 + 3.6% 2,368 2,437

Total Pipelines (km) 59,189 + 87.8% 31,513 25,886

LPG

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FY11 FY10 FY09*

Sale tonnage (ton) 984,600 944,000 495,155

Gross Margin (%) + 4.8% + 8.7% +5.7%

Operating Margin (%) - 0.3% + 1.6% - 0.2%

* Only half year data as China Gas commenced LPG business in Sep.2008

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Beijing

Shanghai

Heilongjiang

Jilin

Liaoning

Inner MongoliaXinjiang

Tibet

Qinghai

Gansu

Ningxia

Shaanxi

Shanxi

Henan

ShandongHebei

Jiangsu

Anhui

Zhejiang

Fujian

JiangxiHunan

Guangdong TaiwanGuangxi

Hainan

Yunnan

Guizhou

SichuanChongqing

Tianjin

Hubei

NATURAL GAS PROJECTS LOCATIONS

Shaanxi Baoji, Qishan Xian, Yulin

Hebei Cangzhou, Cangzhou Economic Development Zone, Nanpi, Qinghe, Leting, Xinle, Gaocheng, Pingshan, Feng Nan, Neiqiu, Wangdu, Nanbao, Bohai New Area, Hebei Pipeline, Tang County

Hubei Yichang, Xiaogan, Hanchuan, Yingcheng, Yunmeng, Suizhou, Tianmen, Guangshui, Dangyang, Xiaogan Pipeline, Dangyang Pipeline, Huanggang-Daye pipeline, Wuhan Qingshan

Hunan Yiyang, Yuanjiang, Youxian

Guangdong Maoming, Conghua, Meizhou, Yunfu, Shanwei, Xinxingxian, Fengshunxian, Pingyuanxian, Huazhou, Dapu, Wuhua

Guangxi Yuling, Qinzhou, Liuzhou, Fongchenggang, Laibin, Baise, Nanning City, Nanning Dongmeng Development Zone, Bobai, Wuxuan

Chongqing Dianjiang E&P, Yubei District, Dingwang purification, Chongqing Pipeline

Inner Mongolia Hohhot, Wushenqi, Wushenqi Pipeline, Changmeng Pipeline, Baotou, 4 counties, Etoke Banner, Etuokeqi, Alashan, Zuoqi Tenggeli Industrial Zone

Ningxia Zhongwei

Fujian 29 city gas concessions

Jiangsu Pizhou, Yangzhong, Nanjing (Jiang Bei, Pukou), Xuzhou (Jiawang), Xuzhou (Xinyi), Yangzhou

Anhui Wuhu, Huainan, Shouxian, Suzhou, Wuhuxian, Nanling, Huoshan, Fengtai, Wuwei, Xiuningxian, Huoqiu, Maoji

Zhejiang Hangzhou (Xiaoshan), Taizhou, Jinhua, Hangzhou Jiangdong Industrial Zone

Liaoning Dalian, Fushun, Jinzhou, Sujiatun(Shenyang), Jinzhou D. Zone, Liaoyang, Gaizhou, Zhuanghe, Linghai, Pulandian, Liaoyang Economic Zone, Jinzhou Longxiwan, Zhuanghe I. Park

Shandong Dezhou, Qingdao, 3 cities from Zhongyu Gas

Tianjin Tianjin Pipeline

Heilongjiang Harbin, Jiamusi, Shuangcheng, Mudanjiang, Jiagedaqi

Jiangxi Nanchang (Wanliqu), Xinfeng

Henan 8 city gas concessions from Zhongyu Gas

Gansu Lingtai County

FINANCIAL HIGHLIGHTS FY2011

FINANCIAL SUMMARY – INCOME STATEMENT

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HK$ ('000) FY11 % change FY10 FY09

Turnover 15,861,880 55.3% 10,211,959 6,323,823

Piped Gas Sales 6,359,041 66.0% 3,831,627 2,678,377

Connection Fees 2,346,388 60.5% 1,461,573 1,127,403

LPG Sales 6,654,797 43.5% 4,637,924 2,272,173

Others 501,654 78.6% 280,835 245,870

Gross Profit 2,910,472 48.1% 2,116,292 1,429,349

EBITDA 2,426,116 37.4% 1,765,568 1,078,684

EBIT 1,778,150 39.9% 1,270,881 732,085

Profit after tax 781,322 - 23.1% 1,015,501 133,959

Core Earnings (ex non-cash & non operating items) 827,405 40.2% 590,085 263,697

Gross Margin – Gas Sales* 17.5% - 20.8% 19.1%

Gross Margin – Connection Fees* 68.4% - 70.6% 67.4%

Gross Margin – LPG Sales 4.8% - 8.7% 5.7%

* Excluding Zhongyu Gas

FINANCIAL SUMMARY – BS & DEBT POSITION

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HK$ ('000) FY11 FY10 (restated)

Total Assets 30,886,528 22,997,594

Total Equity 10,338,156 5,230,237

Shareholder's Equity 8,764,676 4,123,022

Cash 6,729,033 4,361,419

Short-term Bank Debt 7,312,837* 5,332,060**

Long-term Bank Debt 7,720,327 7,984,046

Net Gearing Ratio 48% 124%

* of which HK$3,333,668,000 was Shanghai Zhongyou LPG trade finance related facilities** of which HK$2,450,349,000 was Shanghai Zhongyou LPG trade finance related facilities

OUTLOOK

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OUTLOOK

FY2012 FY2013

Gas volume (m3) 5.2 bn 6.2bn

New residential connections 950,000 1,000,000

CNG stations to reach 140 170

LPG sales (million ton) 1.8 2.2

Enhance organic growth of existing city gas projects in terms of residential penetration, industrial connections and CNG stations rollout

Implement “Hub-Satellite City” investment program to acquire more city concessions

Continue to develop CNG/LNG stations

Active rollout of LPG downstream retail distribution network and achieve industry integration

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DISCLAIMER

Statements in this presentation and handout that are not strictly historical are “forward-looking” statements. Forward-looking statements involve risks and uncertainties, including, but not limited to, continued acceptance of the Company’s product and services in the marketplace, competitive factors, new products and technology changes, the Company’s dependence upon third party suppliers and other risks detailed from time to time in the presentation, handout and other related documents. China Gas is not responsible for the accuracy and completeness of the contents of such presentations and/or other documents. The materials and information in the presentations and other documents are for informational purposes only, and are not an offer or solicitation for the purchase or sale of any securities or financial instruments or to provide any investment service or investment advice.