Petro-King Oilfield Services Limited 百勤油田服務有限公司

THIS PROSPECTUS IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this Prospectus or as to the action to be taken, you should consult your stockbroker or other licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser. Capitalised terms used herein shall have the same meanings as those defined in the section headed “Definitions” in this Prospectus, unless otherwise stated. If you have sold or transferred all your shares in Petro-king Oilfield Services Limited, you should at once hand this Prospectus and the accompanying PAL(s) and EAF(s) to the purchaser(s) or other transferee(s) or bank, licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s). A copy of this Prospectus, together with copies of the documents specified in the paragraphs headed “Documents delivered to the Registrar of Companies” in Appendix III to this Prospectus, has been registered with the Registrar of Companies of Hong Kong as required by section 342C of the Companies (Winding up and Miscellaneous Provisions) Ordinance. The Registrar of Companies of Hong Kong, takes no responsibility for the contents of any of these documents. You should read the whole of the Issue Documents including the discussions of certain risks and other factors as set out in the paragraphs headed “Warning of the Risks of Dealing in the Shares and Nil-paid Rights Shares”inthe“Letter from the Board” in this Prospectus. Subject to the granting of the listing of, and permission to deal in, the Rights Shares in both nil-paid and fully-paid forms on the Stock Exchange as wellas compliance with the stock admission requirements of HKSCC, the Rights Shares in both nil-paid and fully-paid forms will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect from the respective commencement date of dealings in the Rights Shares in their nil-paid and fully-paid forms on the Stock Exchange and you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser for details of those settlement arrangements and how such arrangements may affect your rights and interests. All activities under CCASS are subject to the general rules of CCASS and CCASS operational procedures in effect from time to time. Hong Kong Exchanges and Clearing Limited, the Stock Exchange, HKSCC and the SFC take no responsibility for the contents of the Issue Documents, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of the Issue Documents. The securities described herein have not been registered under the US Securities Act or the laws of any state in the United States and may not be offered orsold within the United States, absent registration or an exemption from the registration requirements of the US Securities Act and applicable state laws. Thereisno intention to register any portion of the Rights Issue or any securities described herein in the United States or to conduct a public offering of securities in the United States. Neither this Prospectus nor any copy hereof may be circulated, distributed, forwarded, delivered or redistributed, electronically or otherwise, directly or indirectly, to persons within the United States, and may not be relied upon as a basis for any investment decision or for any other purpose by any person within the United States. Any failure to comply with this restriction may constitute a violation of US securities laws. This Prospectus does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to acquire, the nil-paid Rights Shares or fully-paid Rights Shares or to take up any entitlements to the nil-paid Rights Shares or fully-paid Rights Shares in the United States or any other jurisdiction in which such an offer or solicitation is unlawful. Except as otherwise set out in this Prospectus, the Rights Issue is not being extended to Shareholders with registered addresses in, or investors who are located or resident in, any jurisdictions outside Hong Kong. This Prospectus has not been lodged or registered with any of the relevant authorities in any jurisdiction other than Hong Kong.

PETRO-KING OILFIELD SERVICES LIMITED 百勤油田服務有限公司 (Incorporated in the British Virgin Islands with limited liability) (Stock Code: 2178) PROPOSED RIGHTS ISSUE OF RIGHTS SHARES AT HK$0.31 PER RIGHTS SHARE ON THE BASIS OF THREE RIGHTS SHARES FOR EVERY TEN EXISTING SHARES HELD ON THE RECORD DATE Underwriters Great Wisdom Greenwoods China Alpha Master Fund

Financial Adviser to the Company

Capitalised terms used in this cover shall have the same meanings as those defined in this Prospectus. The latest time for acceptance of and payment for the Rights Shares is 4:00 p.m. on Wednesday, 29 June 2016. The procedures for application and payment or transfer of the Rights Shares are set out on pages 22 to 28 of this Prospectus. The Underwriting Agreements in respect of the Rights Issue contain provisions entitling the Underwriters by notice in writing to the Company to terminate the several obligations of the Underwriters thereunder on the occurrence of certain events including force majeure. These events are set out in the section headed “Termination of the Underwriting Agreements” on pages 12 of this Prospectus. Shareholders should note that the existing Shares have been dealt in on ex-rights basis from Friday, 3 June 2016. The Rights Shares in their nil-paid form will be dealt in from Friday, 17 June 2016 to Friday, 24 June 2016 (both days inclusive). If prior to the Latest Time for Termination, the Underwriters terminate the Underwriting Agreements or if any of the other conditions of the Rights Issue as set out in the paragraphs headed “Conditions of the Rights Issue and the Underwriting Agreements” contained in this Prospectus is not fulfilled or waived (as applicable), the Rights Issue will not proceed. If the Underwriters terminate or rescind the Underwriting Agreements, the Rights Issue will not proceed.

Any dealings in the Shares up to the date on which all the conditions of the Rights Issue are fulfilled and the date on which the Underwriters’ right of termination of the Underwriting Agreements ceases, will accordingly bear the risk that the Rights Issue may not become unconditional and may not proceed. Any Shareholder or other person contemplating selling or purchasing the Shares who is in any doubt about his/her position is recommended to consult his/her own professional adviser.

15 June 2016 NOTICES

THIS PROSPECTUS IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

The Rights Issue is conditional upon the fulfilment of the conditions as described in the paragraphs headed “Conditions of the Rights Issue and the Underwriting Agreements” in this Prospectus. If any of the conditions of the Rights Issue is not fulfilled or waived (as applicable), the Rights Issue will not proceed. It should be noted that existing Shares have been dealt with on an ex-rights basis from Friday, 3 June 2016. The Rights Shares in their nil-paid form are expected to be dealt in from Friday, 17 June 2016 to Friday, 24 June 2016 (both days inclusive). If the Underwriters terminate the Underwriting Agreements, or the conditions of the Rights Issue are not fulfilled, the Rights Issue will not proceed.

Any Shareholder or other person contemplating transferring, selling or purchasing the Shares and/or the Rights Shares in their nil-paid forms is advised to exercise caution when dealing in the Shares and/or Rights Shares. Any person who is in any doubt about his/her/its position or any action to be taken is recommended to consult his/her/its own professional adviser(s). Any Shareholder or other person dealing in Shares or in the nil-paid Rights Shares up to the date on which all the conditions to which the Rights Issue is subject are fulfilled (and the date on which the Underwriters’ right of termination of the Underwriting Agreements ceases), will accordingly bear the risk that the Rights Issue may not become unconditional or may not proceed.

EXCEPT AS OTHERWISE SET OUT HEREIN, THE RIGHTS ISSUE DESCRIBED IN THIS PROSPECTUS IS NOT BEING EXTENDED TO SHAREHOLDERS WITH REGISTERED ADDRESSES IN, OR INVESTORS WHO ARE LOCATED OR RESIDENT IN, ANY OF THE JURISDICTIONS OUTSIDE HONG KONG. This Prospectus does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to acquire, the nil-paid Rights Shares or fully-paid Rights Shares or to take up any entitlements to the nil-paid Rights Shares or fully-paid Rights Shares in any jurisdiction in which such an offer, invitation or solicitation is unlawful. None of the nil-paid Rights Shares, the fully-paid Rights Shares, this Prospectus, the PAL and the EAF have been or will be registered or filed under the securities laws of any jurisdiction or with any securities commission or similar regulatory authority in any jurisdiction outside Hong Kong and none of the nil-paid Rights Shares, the fully-paid Rights Shares, this Prospectus, the PAL and the EAF will qualify for distribution under any of the relevant securities laws of any of the jurisdictions outside Hong Kong. Accordingly, the nil-paid Rights Shares and the fully-paid Rights Shares may not be offered, sold, pledged, taken up, resold, renounced, transferred or delivered, directly or indirectly, into or within any jurisdictions outside Hong Kong absent registration or qualification under the respective securities laws of such jurisdictions outside Hong Kong, or exemption from the registration or qualification requirement under applicable rules of such jurisdictions.

Shareholders with registered addresses in, and investors who are located or resident in, any of the jurisdictions outside Hong Kong are referred to the paragraphs headed “Excluded Shareholders” under the section headed “Letter from the Board” of this Prospectus.

–i– NOTICES

FORWARD-LOOKING STATEMENTS

All statements in this Prospectus other than statements of historical fact are forward-looking statements. In some cases, forward-looking statements may be identified by the use of words such as “might”, “may”, “could”, “would”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “predict”, “confident”, “plan”, “seek”, “continue”, “illustrate”, “illustration”, “projection” or similar expressions and the negative thereof. Forward-looking statements in this Prospectus include, without limitation, statements in respect of the Group’s business strategies, service offerings, market position, competition, financial prospects, performance, liquidity and capital resources, as well as statements regarding trends in the relevant industries and markets in which the Group operates, technological advances, financial and economic developments, legal and regulatory changes and their interpretation and enforcement.

The forward-looking statements in this Prospectus are based on management’s present expectations about future events. Management’s present expectations reflect numerous assumptions regarding the Group’s strategy, operations, industry, developments in the credit and other financial markets and trading environment. By their nature, they are subject to known and unknown risks and uncertainties, which could cause actual results and future events to differ materially from those implied or expressed by forward-looking statements. Should one or more of these risks or uncertainties materialise, or should any assumptions underlying forward-looking statements prove to be incorrect, the Group’s actual results could differ materially from those expressed or implied by forward-looking statements. Additional risks not known to the Group or that the Group does not currently consider material could also cause the events and trends discussed in this Prospectus not to occur, and the estimates, illustrations and projections of financial performance not to be realised.

Prospective investors are cautioned that forward-looking statements speak only as at the date of publication of this Prospectus. Except as required by applicable law, the Group does not undertake, and expressly disclaims, any duty to revise any forward-looking statement in this Prospectus, be it as a result of new information, future events or otherwise.

–ii– TABLE OF CONTENTS

Page

DEFINITIONS ...... 1

SUMMARY OF THE RIGHTS ISSUE ...... 8

EXPECTED TIMETABLE ...... 10

TERMINATION OF THE UNDERWRITING AGREEMENTS ...... 12

LETTER FROM THE BOARD ...... 13

APPENDIX I – FINANCIAL INFORMATION OF THE GROUP ...... I-1

APPENDIX II – UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP ...... II-1

APPENDIX III – GENERAL INFORMATION ...... III-1

– iii – DEFINITIONS

In this Prospectus, the following terms shall have the meanings respectively set opposite them unless the context requires otherwise:

“1st Announcement” the announcement of the Company dated 26 May 2016, in relation to, among other things, the proposed Rights Issue

“2nd Announcement” the announcement of the Company dated 15 June 2016 in relation to the entering into the Supplemental Underwriting Agreement by the Company and the Underwriters

“Acceptance Date” Wednesday, 29 June 2016, being the last date for acceptance of, and payment for, the Rights Shares

“Beneficial Owner(s)” any beneficial owner(s) of Shares whose Shares are registered in the name of a registered Shareholder

“Board” the board of Directors

“Business Day” a day (other than a Saturday and any day on which a tropical cyclone warning signal no. 8 or above or a “black” rainstorm warning signal is hoisted or in effect between 9:00 a.m. and 12:00 noon and is not lowered or discontinued at or before 12:00 noon) on which commercial banks in Hong Kong are open for business

“BVI” British Virgin Islands

“CCASS” the Central Clearing and Settlement System established and operated by HKSCC

“CCASS Clearing Participant” a person admitted by HKSCC to participate in CCASS as a direct clearing participant/broker participant or general clearing participant

“CCASS Custodian Participant” a person admitted by HKSCC to participate in CCASS as a custodian participant

“CCASS Investor Participant” a person admitted to participate in CCASS as an investor participant who may be an individual or joint individuals or a corporation

“CCASS Participant” a CCASS Clearing Participant or a CCASS Custodian Participant or a CCASS Investor Participant

–1– DEFINITIONS

“China Galaxy” China Galaxy International Securities (Hong Kong) Co., Limited, a licensed corporation to conduct type 1 (dealing in securities), type 4 (advising on securities) and type 6 (advising on corporate finance) regulated activities under the SFO, being the financial adviser to the Company in relation to the Rights Issue and one of the Underwriters

“Committed Shares” The aggregate of 287,936,973 Rights Shares which the Undertaking Covenantors have undertaken to subscribe

“Companies Ordinance” The Companies Ordinance (Chapter 622 of the Laws of Hong Kong), including its amendments from time to time

“Companies (WUMP) The Companies (Winding Up and Miscellaneous Ordinance” Provisions) Ordinance (Chapter 32 of the Laws of Hong Kong), including its amendments from time to time

“Company” Petro-king Oilfield Services Limited (stock code: 2178), a company incorporated in the BVI with limited liability and whose Shares are listed on the main board of the Stock Exchange

“connected persons” has the meaning ascribed thereto under the Listing Rules

“controlling Shareholder(s)” has the meaning ascribed thereto under the Listing Rules

“Convertible Bonds” convertible bonds in the principal amount of HK$157,000,000 issued by the Company on 30 March 2015

“Despatch Date” 15 June 2016, being the expected date of despatch of the Issue Documents (or such later date as may be agreed between the Company and the Underwriters)

“Director(s)” the director(s) of the Company

–2– DEFINITIONS

“Directors Options” outstanding and vested options or options to be vested before the Record Date to subscribe for 1,044,912 Shares granted to the Directors pursuant to the Share Options Scheme (which include outstanding and vested options or options to be vested before the Record Date of 68,114 Share Options held by each of Mr. Wang Jinlong, Mr. Lee Tommy, Mr. Ko Po Ming, Ms. Ma Hua, Mr. He Shenghou, Mr. Tong Hin Wor and Mr. Wong Lap Tat Arthur and 568,114 Share Options held by Mr. Zhao Jindong)

“EAF(s)” the excess application form(s) for application for excess Rights Shares proposed to be issued to the Qualifying Shareholders in connection with the Rights Issue

“Excluded Shareholders” the Overseas Shareholders in respect of whom the Board, after making relevant enquiries, considers it necessary or expedient not to offer the Rights Shares to such Overseas Shareholder(s) on account either of legal restrictions under the laws of the relevant place or the requirements of the relevant regulatory body or stock exchange in that place

“Golden China Master Fund” Golden China Master Fund, a company incorporated in Cayman Islands with limited liability, an affiliated entity of Greenwoods China Alpha Master Fund and a fund managed by Greenwoods Asset Management, and at the Latest Practicable Date, held Convertible Bonds of HK$39 million

“Golden China Master Fund the irrevocable undertaking given by Golden China Undertaking” Master Fund dated 26 May 2016 of not to convert the Convertible Bonds held by them and not to sell or transfer such Convertible Bonds held by them before the completion of the Rights Issue

“Great Wisdom” Great Wisdom Investment Limited, a company incorporated in Hong Kong with limited liability and is wholly-owned by Mr. Lee Lap

“Greenwoods” Greenwoods Asset Management, Greenwoods China Alpha Master Fund and their affiliated entities

–3– DEFINITIONS

“Greenwoods Asset Greenwoods Asset Management Limited, an Management” exempted company incorporated in the Cayman Islands, is an investment manager and is wholly-owned by Greenwoods Asset Management Holdings, which in turn was held 81% by Jiang Jinzhi and as of the Latest Practicable Date, held 2,558,428 Shares through Greenwoods Funds other than Greenwoods China Alpha Master Fund

“Greenwoods China Alpha Greenwoods China Alpha Master Fund, a company Master Fund” incorporated in Cayman Islands with limited liability and a fund managed by Greenwoods Asset Management, being one of the Underwriters, and as of the Latest Practicable Date, held 70,093,285 Shares

“Greenwoods Funds” Funds and/or managed accounts managed/advised by Greenwoods Asset Management and its affiliates

“Group” the Company and its subsidiaries

“HKSCC” Hong Kong Securities Clearing Company Limited

“Hong Kong” the Hong Kong Special Administrative Region of the PRC

“Intermediary” in relation to a Beneficial Owner whose Shares are deposited in CCASS and registered in the name of HKSCC Nominees Limited, means the Beneficial Owner’s broker, custodian, nominee or other relevant person who is a CCASS Participant or who has deposited the Beneficial Owner’s Shares with a CCASS Participant

“Irrevocable Undertakings” each of the irrevocable undertakings dated 26 May 2016 given by each of the Undertaking Covenantors

“Issue Documents” the Prospectus, the PAL and the EAF proposed to be despatched to the Qualifying Shareholders on the Despatch Date and any such supplementary prospectus to be despatched to the Qualifying Shareholders (if required)

–4– DEFINITIONS

“Jade Win” Jade Win Investment Limited, a company incorporated in the BVI with limited liability, and a Shareholder holding as to approximately 7.89% of the issued Shares of the Company as at the Latest Practicable Date

“King Shine” King Shine Group Limited, a company incorporated in the BVI with limited liability, and a Shareholder holding as to approximately 28.32% of the issued Shares of the Company as at the Latest Practicable Date

“Last Trading Day” 26 May 2016, being the last trading day for the Shares on the Stock Exchange before the release of the 1st Announcement

“Latest Practicable Date” 10 June 2016, being the latest practicable date prior to the printing of this Prospectus for the purpose of ascertaining certain information in this Prospectus

“Latest Time for Termination” 5:00 p.m. on the first Business Day following the Acceptance Date, being the latest time for the termination of the Underwriting Agreements

“Listing Committee” has the meaning ascribed thereto under the Listing Rules

“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

“Overseas Shareholders” the Shareholders whose addresses as shown in the register of members of the Company as at the close of business on the Record Date are outside Hong Kong

“PAL(s)” the provisional allotment letter(s) for the Rights Shares to be issued to the Qualifying Shareholders in respect of their entitlements under the Rights Issue

“PRC” the People’s Republic of China (excluding, for the purpose of this Prospectus, Hong Kong, Macau Special Administrative Region of the PRC and Taiwan)

“Prospectus” this prospectus issued by the Company for the Rights Issue

–5– DEFINITIONS

“Qualifying Shareholders” Shareholders, whose names appear on the register of members of the Company as at the close of business on the Record Date, other than the Excluded Shareholders

“Record Date” 14 June 2016, being the date by reference to which entitlements of the Shareholders to participate in the Rights Issue will be determined (or such other date as the Underwriters may agree in writing with the Company)

“Registered Owner” in respect of a Beneficial Owner, means a nominee, trustee, depository or any other authorised custodian or third party which is the registered holder in the register of members of the Company of the Shares in which the Beneficial Owner is beneficially interested

“Rights Issue” the proposed issue by way of rights of Rights Shares in the proportion of three (3) Rights Shares for every ten (10) existing Shares held on the Record Date to the Qualifying Shareholders at the Subscription Price

“Rights Share(s)” 398,463,388 Shares to be allotted and issued under the Rights Issue as at the Record Date

“SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong), including its amendments from time to time

“Share Option Scheme” the share option scheme adopted by the Company on 18 February 2013

“Share Options” the options granted by the Company to subscribe for Shares pursuant to the Share Option Scheme

“Share Registrar” Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, the Company’s Hong Kong branch share registrar

“Share(s)” ordinary shares of the Company with no par value

“Shareholder(s)” holder(s) of the Shares

“Stock Exchange” The Stock Exchange of Hong Kong Limited

–6– DEFINITIONS

“Subscription Price” HK$0.31 per Rights Share

“Supplemental Underwriting the supplemental underwriting agreement to the Agreement” Underwriting Agreement dated 10 June 2016 entered into between the Company and the Underwriters in relation to the Right Issue

“Termbray Natural Resources” Termbray Natural Resources Company Limited, a company incorporated in the BVI with limited liability, and a Shareholder holding as to approximately 30.47% of the issued Shares of the Company as at the Latest Practicable Date

“Undertaken Options” outstanding and vested options or options to be vested before the Record Date to subscribe for 11,440,000 Shares granted to the holders pursuant to the Share Option Scheme

“Undertaking Covenantors” Termbray Natural Resources, King Shine, Jade Win, Greenwoods China Alpha Master Fund and Greenwoods Asset Management, Mr. Ko Po Ming and Mr. Wong Lap Tat Arthur

“Underwriters” Great Wisdom, Greenwoods China Alpha Master Fund, and China Galaxy

“Underwriting Agreement” the underwriting agreement dated 26 May 2016 entered into between the Company and the Underwriters in relation to the Rights Issue

“Underwriting Agreements” the Underwriting Agreement and the Supplemental Underwriting Agreement

“Underwritten Shares” the Rights Shares other than the Committed Shares

“US Securities Act” the US Securities Act of 1933, as amended

“US”, “USA” or “United States” the United States of America (including its territories and dependencies, any state in the United States and the District of Columbia)

“HK$” Hong Kong dollars, the lawful currency of Hong Kong

“%” per cent or percentage

–7– SUMMARY OF THE RIGHTS ISSUE

The following information is derived from, and should be read in conjunction with the full text of this Prospectus:

The Rights Issue : The Rights Issue provides a means for the Company to raise additional capital by offering to Qualifying Shareholders the right to subscribe for further Shares in proportion to their existing shareholdings

Basis of the Rights Issue : Three (3) Rights Shares for every ten (10) existing Shares held by Qualifying Shareholders on the Record Date

Subscription Price : HK$0.31 for each Rights Share

Number of Shares in issue : 1,328,211,294 Shares as at the Latest Practicable Date

Number of Rights Shares to : 398,463,388 Shares be issued

Underwriters : Great Wisdom, Greenwoods China Alpha Master Fund and China Galaxy

Enlarged issued Shares of : 1,726,674,682 Shares the Company upon completion of the Rights Issue

Latest time for acceptance : 4:00 p.m. on Wednesday, 29 June 2016

Amount to be raised : approximately HK$123.52 million, before expenses

Rights of excess : Qualifying Shareholders may apply for Rights Shares applications in excess of their provisional allotment

–8– SUMMARY OF THE RIGHTS ISSUE

As at the Latest Practicable Date, Termbray Natural Resources (a controlling Shareholder), King Shine, Jade Win, Greenwoods Funds, Mr. Ko Po Ming, a non-executive Director, and Mr. Wong Lap Tat Arthur, an independent non-executive Director, held 404,754,104 Shares, 376,092,414 Shares, 104,848,827 Shares, 72,651,713 Shares, 1,142,857 Shares and 300,000 Shares, respectively, representing approximately 30.47%, 28.32%, 7.89%, 5.47%, 0.09% and 0.02% of the total issued Shares, respectively. Each of the Undertaking Covenantors had undertaken to the Company, among other things, that it/he would subscribe for such number of Rights Shares to be allotted to it/him.

As at the Latest Practicable Date, there were (i) outstanding and vested options or options to be vested before the Record Date to subscribe for 24,813,854 Shares granted pursuant to the Share Option Scheme (inclusive of the Directors Options and the Undertaken Options) and (ii) Convertible Bonds in the principal amount of HK$157,000,000 issued by the Company on 30 March 2015, convertible into approximately 112,949,640 Shares, at the conversion price of HK$1.39 per Share.

As at the Latest Practicable Date, (i) holders of the Directors Options to subscribe for 1,044,912 Shares had undertaken to the Company that they would not exercise the subscription rights under any of the Directors Options before completion of the Rights Issue; (ii) holders of the Undertaken Options to subscribe for 11,440,000 Shares had undertaken to the Company that they would not exercise the subscription rights under any of the Undertaken Options before completion of the Rights Issue; (iii) Golden China Master Fund, an affiliated entity of Greenwoods China Alpha Master Fund have undertaken not to convert into Shares and not to sell or transfer HK$39 million worth of Convertible Bonds convertible into 28,057,554 Shares, held by them before the completion of the Rights Issue.

As at the Latest Practicable Date, save for the undertakings as abovementioned and assuming full exercise of the remaining outstanding and vested options under the Share Option Scheme and the Convertible Bonds, the maximum number of new Shares that would fall to be issued and allotted under the Share Option Scheme and the Convertible Bonds prior to the Record Date would be 12,328,942 and 84,892,086 respectively.

Save as disclosed above, the Company has no outstanding convertible securities, options or warrants in issue which entitle the holders thereof to subscribe for or convert into any Shares prior to the Record Date nor has entered into any agreement to do any of the foregoing as at the Latest Practicable Date.

As at the Latest Practicable Date, the Company had not received any exercise notice in respective of any of the Undertaken Options and the Convertible Bonds. As the register of members of the Company was closed from Tuesday, 7 June 2016 to Tuesday, 14 June 2016 (both days inclusive) for determining the entitlements to the Rights Issue and no transfer of any issued Shares of the Company would be registered during this period, there was no change in the total number of issued Shares. As a result, the total number of issued Shares as at the Record Date and the total number of Rights Shares to be issued by the Company were 1,328,211,294 Shares and 398,463,388 Rights Shares, respectively.

–9– EXPECTED TIMETABLE

The expected timetable for the Rights Issue and the associated trading arrangement are set out below:

Event

First day for dealings in nil-paid Rights Shares ...... 9:00 a.m. on Friday, 17 June 2016

Latest time for splitting of nil-paid Rights Shares ...... 4:30 p.m. on Tuesday, 21 June 2016

Last day for dealings in nil-paid Rights Shares ...... close of business on Friday, 24 June 2016

Latest time for acceptance of, and payments for, the Rights Shares and application and payment for excess Rights Shares ...... 4:00 p.m. on Wednesday, 29 June 2016

Latest time for the termination of the Underwriting Agreements ...... 5:00 p.m. on Thursday, 30 June 2016

Announcement of results of the Rights Issue to be published on the respective websites of the Stock Exchange and the Company ...... Thursday, 7 July 2016

Share certificates for fully-paid Rights Shares expected to be posted ...... Friday, 8 July 2016

Refund cheques for wholly and partially unsuccessful excess applications to be posted ...... Friday, 8 July 2016

Dealings in fully-paid Rights Shares commences ....9:00 a.m. on Monday, 11 July 2016

Designated broker start to stand in market to provide matching services for sale and purchase of odd lots Shares ...... 9:00 a.m. on Monday, 11 July 2016

Designated broker ceases to stand in the market to provide matching services for sale and purchase of odd lots Shares ...... 4:00 p.m. on Monday, 1 August 2016

–10– EXPECTED TIMETABLE

Notes:

(i) All times and dates in this Prospectus refer to Hong Kong local times and dates.

(ii) The dates or deadlines specified in this Prospectus for events in the timetable for (or otherwise in relation to) the Rights Issue are indicative only and may be extended or varied by the Company and the Underwriters. The Company will notify Shareholders in the event of any changes to the expected timetable as and when appropriate.

Effect of bad weather on the latest time for acceptance of and payment for Rights Shares and application for excess Rights Shares

The latest time for acceptance of and payment for Rights Shares and application for excess Rights Shares will not take place at the time indicated above if there is a tropical cyclone warning signal number 8 or above, or a “black” rainstorm warning:

(i) in force in Hong Kong at any local time before 12:00 noon and no longer in force after 12:00 noon on Wednesday, 29 June 2016. Instead, the latest time of acceptance of and payment for the Rights Shares and for application and payment for excess Rights Shares will be extended to 5:00 p.m. on the same Business Day; or

(ii) in force in Hong Kong at any local time between 12:00 noon and 4:00 p.m. on Wednesday, 29 June 2016. Instead, the latest time of acceptance of and payment for the Rights Shares and for application and payment for excess Rights Shares will be rescheduled to 4:00 p.m. on the following Business Day which does not have either of those warnings in force at any time between 9:00 a.m. and 4:00 p.m.

If the latest time for acceptance of and payment for the Rights Shares and for application and payment for excess Rights Shares does not take place on Wednesday, 29 June 2016, the dates mentioned in the paragraph headed “Expected Timetable for the Rights Issue” above may be affected. The Company will notify Shareholders by way of a separate announcement of any change to the expected timetable as soon as practicable.

–11– TERMINATION OF THE UNDERWRITING AGREEMENTS

The Underwriting Agreement contains provisions granting the Underwriters, by notice in writing to the Company, the right to terminate the Underwriting Agreements on the occurrence of certain events.

The Underwriters may by notice in writing to the Company, served prior to the Latest Time for Termination, rescind or terminate the Underwriting Agreements if, at any time prior to the Latest Time for Termination:

(a) there occurs any new regulation or any change in the existing law or regulation (or the judicial interpretation thereof) or other occurrence of any nature whatsoever which may in the reasonable opinion of the Underwriters materially and adversely affect the business or the financial or trading position or prospects of the Group as a whole; or

(b) there occurs any local, national or international event or change, whether or not forming part of a series of events or changes occurring or continuing before, or after the date hereof, of a political, military, financial, economic or other nature (whether or not ejusdem generis with any of the foregoing), or in the nature of any local, national or international outbreak or escalation of hostilities or armed conflict, or affecting local securities markets which may, in the reasonable opinion of the Underwriters, materially and adversely affect the business or the financial or trading position or prospects of the Group as a whole; or

(d) any material adverse change in market conditions (including, without limitation, a change in fiscal or monetary policy or foreign exchange or currency markets, suspension or restriction of trading in securities) which, in the reasonable opinion of the Underwriters, makes it inexpedient or inadvisable to proceed with the Rights Issue.

The Rights Issue is conditional upon the Underwriting Agreements becoming unconditional and not being terminated in accordance with its terms. If the Underwriting Agreements does not become unconditional or in the event the Underwriters exercise their rights to rescind or terminate the Underwriting Agreements prior to the Latest Time for Termination, then the Rights Issue will not proceed, and all obligation and liabilities of the parties to the Underwriting Agreements will cease and determine and no party will have any claim against any other party in respect of any matter or thing arising out of or in connection with the Underwriting Agreements (save in respect of any antecedent breach of any obligation under the Underwriting Agreements and in respect of any costs, fees and other reasonable out-of-pocket expenses of the Underwriters (other than any underwriting commission) which will be borne by the Company). In such an event, the Company will make a further announcement at the relevant time.

–12– LETTER FROM THE BOARD

PETRO-KING OILFIELD SERVICES LIMITED 百勤油田服務有限公司 (Incorporated in the British Virgin Islands with limited liability) (Stock Code: 2178)

Executive Directors: Registered office: Mr. Wang Jinlong Commerce House Mr. Zhao Jindong Wickhams Cay 1 P.O. Box 3140 Non-executive Directors: Road Town, Tortola Mr. Ko Po Ming British Virgin Islands Mr. Lee Tommy VG1110 Ms. Ma Hua Principal place of Independent non-executive Directors: business in Hong Kong: Mr. He Shenghou Office No. 504, 5th Floor Mr. Tong Hin Wor Tower 1, Silvercord Mr. Wong Lap Tat Arthur No. 30 Canton Road Kowloon, Hong Kong

15 June 2016

To Qualifying Shareholders, and for information only, Excluded Shareholders

Dear Sir or Madam,

PROPOSED RIGHTS ISSUE OF RIGHTS SHARES AT HK$0.31 PER RIGHTS SHARE ON THE BASIS OF THREE RIGHTS SHARES FOR EVERY TEN EXISTING SHARES HELD ON THE RECORD DATE

INTRODUCTION

Reference is made to the 1st Announcement and the 2nd Announcement. On 26 May 2016, the Board announced that, the Company proposes to raise approximately HK$123.52 million before expenses by way of the Rights Issue pursuant to which 398,463,388 Rights Shares will be issued at the Subscription Price of HK$0.31 per Rights Share. On 10 June 2016, the Company entered into the Supplemental Underwriting Agreement with the Underwriters in relation to the re-allocation of Underwritten Shares among the Underwriters. The Company will provisionally allot three nil-paid Rights Shares for every ten existing Shares held by the Qualifying Shareholders as at the close of business on the Record Date. The Qualifying Shareholders are entitled to apply for additional Rights

–13– LETTER FROM THE BOARD

Shares in excess of their respective entitlements under the Rights Issue. The Rights Issue will not be available to the Excluded Shareholders.

The Rights Issue is subject to, among other things, the Underwriting Agreements becoming unconditional and not being terminated on the occurrence of certain events including force majeure.

The Underwritten Rights Shares are underwritten in full on the terms and subject to the conditions set out in the Underwriting Agreements.

The purpose of this Prospectus is to provide you with further information regarding the Rights Issue, including information on dealings in, transfer of and application for the Rights Shares, and financial information and other information of the Group.

RIGHTS ISSUE

Issue statistics

Basis of the Rights Issue : Three (3) Rights Shares for every ten (10) existing Shares held by the Qualifying Shareholders on the Record Date

Subscription Price : HK$0.31 per Rights Share

Number of the Shares in issue as : 1,328,211,294 Shares at the Latest Practicable Date

Number of Rights Shares : 398,463,388 Rights Shares

Underwriters : Great Wisdom, Greenwoods China Alpha Master Fund and China Galaxy

Number of Underwritten Shares : 110,526,415 Rights Shares

Enlarged issued Shares of the : 1,726,674,682 Shares Company

Amount to be raised : approximately HK$123.52 million, before expenses

Rights of excess applications : Qualifying Shareholders may apply for Rights Shares in excess of their provisional allotment

–14– LETTER FROM THE BOARD

As no new Shares (other than the Rights Shares) were allotted and issued on or before the Record Date, the aggregate number of nil-paid Rights Shares proposed to be provisionally allotted pursuant to the terms of the Rights Issue represents approximately 30.00% of the Company’s total number of Shares in issue as at the Latest Practicable Date and will represent approximately 23.08% of the Company’s Shares in issue as enlarged by the Rights Issue.

–15– LETTER FROM THE BOARD

Qualifying Shareholders

The Rights Issue is only available to the Qualifying Shareholders and will not be available to the Excluded Shareholders. The Company will, to the extent permitted under the relevant laws and regulations and reasonably practicable, send the Prospectus to the Excluded Shareholders for information purposes only but will not send any PAL or EAF to them.

To qualify for the Rights Issue, a Shareholder must:

(i) have been registered as a member in the register of members of the Company as at the close of business on the Record Date; and

(ii) not be an Excluded Shareholder (see the section headed “Excluded Shareholders” below).

In order for transferees to be registered as a member of the Company by the Record Date, any transfers of Shares (with the relevant share certificate(s)) must have been lodged for registration with the Share Registrar, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong by not later than 4:30 p.m. on Monday, 6 June 2016 (the register of members of the Company was closed from Tuesday, 7 June 2016 to Tuesday, 14 June 2016, both days inclusive).

Qualifying Shareholders who take up their pro rata entitlements in full will not suffer any dilution to their shareholding interests in the Company (save as a result of fractional entitlements to Rights Shares). If a Qualifying Shareholder does not take up his/her/its entitlement under the Rights Issue in full, his/her/its proportionate shareholding in the Company will be diluted. If the Qualifying Shareholders do not take up their respective entitlements under the Rights Issue, the respective shareholding interests of the Qualifying Shareholders in the Company will be diluted by approximately 23.08%.

Distribution of Issue Documents

Distribution of the Issue Documents into jurisdictions other than Hong Kong may be restricted by law. Persons into whose possession the Issue Documents come (including, without limitation, agents, custodians, nominees and trustees) should inform themselves of and observe any such restrictions. Failure to comply with those restrictions may constitute a violation of the securities laws of any such jurisdiction. Any Shareholder who is in any doubt as to his/her/its position should consult an appropriate professional adviser without delay. In particular, subject to certain exceptions as determined by the Company, this Prospectus should not be distributed, forwarded to or transmitted in, into or from any jurisdictions outside Hong Kong with or without the PAL and EAF. The Issue Documents have not been and will not be registered or filed under the applicable securities legislation of any jurisdiction other than Hong Kong.

–16– LETTER FROM THE BOARD

Excluded Shareholders

As at the Latest Practicable Date, to the Company’s best knowledge, there were certain Overseas Shareholders on the register of members of the Company, who are entities incorporated in the BVI (the “BVI Shareholders”). Pursuant to Rule 13.36(2) of the Listing Rules, the Company has made enquiries regarding the legal restrictions under the applicable securities legislation of the relevant overseas jurisdiction and the requirements of the relevant regulatory bodies or stock exchanges with respect to the offer of the Rights Shares to Shareholders situated in such overseas jurisdiction.

On the basis of the legal advice received, details of which are set out in the paragraph headed “BVI Shareholders” below, the Directors do not consider that it is not necessary or expedient and not in the interests of the Company and Shareholders as a whole to offer the Rights Shares (in both nil-paid and fully-paid forms) to the BVI Shareholders on account either of the legal restrictions under the laws of the relevant place or any applicable requirements of the relevant regulatory body or stock exchange in that place. Therefore, the Rights Issue will be extended to such BVI Shareholders.

For the purposes of the Rights Issue, an Excluded Shareholder is:

(a) a Shareholder whose name appeared in the register of members of the Company as at the close of business on the Record Date and whose address as shown in such register is in any territory or jurisdiction outside Hong Kong and the BVI; and

(b) any Shareholder at that time who are otherwise known by the Company to be resident in any territory or jurisdiction outside Hong Kong and the BVI.

No person receiving a PAL or an EAF in any territory or jurisdiction other than Hong Kong may treat it as an offer or invitation to apply for the Rights Shares, unless in a territory or jurisdiction where such an offer or invitation could lawfully be made without compliance with any registration or other legal and regulatory requirements thereof or where the offer is made in reliance on any exemption or where compliance with the relevant legal or regulatory requirement will not, in the Board’s judgement, be unduly burdensome. Where permitted by the laws of the relevant overseas jurisdictions, the Company will send this Prospectus to the Excluded Shareholders for their information only.

–17– LETTER FROM THE BOARD

Receipt of this Prospectus and/or a PAL and/or an EAF or the crediting of nil-paid Rights Shares to any stock account (including in CCASS) does not and will not constitute an offer in any jurisdictions in which it would be illegal to make an offer and, in those circumstances, this Prospectus and/or other Issue Documents must be treated as sent for information only and should not be copied or redistributed. Persons (including, without limitation, agents, custodians, nominees and trustees) who receive a copy of this Prospectus and other Issue Documents or whose stock account in CCASS is credited with nil-paid Rights Shares should not, in connection with the Rights Issue, distribute or send the same in, into or from, or transfer nil-paid Rights Shares to any person in, into or from, any jurisdiction outside Hong Kong, unless offer to such jurisdictions could lawfully be made without compliance with any registration or other legal or regulatory requirements or where the offer is made reliance on any exemption or where compliance with the relevant legal or regulatory requirement will not, in the Board’s judgement, be unduly burdensome. If a PAL or an EAF or a credit of nil-paid Rights Shares in CCASS is received by any person in any such territory, or by his/her/its agent, custodian, nominee or trustee, he/she/it should not seek to take up the rights referred to in the PAL or transfer the PAL (or apply for any excess Rights Shares under the EAF) or transfer the nil-paid Rights Shares in CCASS unless the Company, in its absolute discretion, determines that such actions would not violate applicable legal or regulatory requirements. Any person (including, without limitation, agents, custodians, nominees and trustees) who forwards this Prospectus and/or a PAL and/or an EAF in, into or from, any jurisdiction outside Hong Kong (whether under a contractual or legal obligation or otherwise) should draw the recipient’s attention to the contents of this section.

Notwithstanding any other provision in the Issue Documents, the Company reserves the right to permit any Shareholder (whether as a direct holder or a beneficial owner) whose registered address is in, or who is otherwise resident in, a jurisdiction other than Hong Kong to take up his/her/its nil-paid rights and/or apply for excess Rights Shares if the Company, in its absolute discretion, is satisfied that the transaction in question is exempt from or not subject to the legislation or regulations giving rise to the restrictions in question.

BVI Shareholders

The Directors have made the necessary enquiries pursuant to Rule 13.36(2)(a) of the Listing Rules and have been advised that if the Rights Issue is made by the Company and Issue Documents relating to the Rights Issue will be sent to the BVI Shareholders solely by reason that such BVI Shareholders are existing shareholders of the Company, there are no securities law or other similar laws in the BVI to comply with in order to enable the Company to include the BVI Shareholders in the Rights Issue.

The BVI legal advisers to the Company advised that on the basis that the Rights Shares will be offered to, and the Issue Documents relating to the Rights Issue will be despatched to, the BVI Shareholders solely by reason that the BVI Shareholders are existing shareholders of the Company, there are (a) no legal or regulatory restrictions in the BVI which prohibits the Rights Issue to be extended to the BVI Shareholders or for the Issue Documents to be despatched to the BVI Shareholders; and (b) no requirements of any governmental authority, stock exchange or regulatory body in the BVI that limits the Rights Issue to be offered to the BVI Shareholders.

–18– LETTER FROM THE BOARD

Arrangements for Rights Shares which would otherwise have been available to the Excluded Shareholders

Arrangements have been made for the Rights Shares which would otherwise have been provisionally allotted to the Excluded Shareholders to be sold in the market in their nil-paid form as soon as practicable after dealings in the nil-paid Rights Shares commence and before dealings in nil-paid Rights Shares end, if a premium (net of expenses) can be obtained. Any net proceeds of sale thereof, after deduction of expenses, will be distributed by the Company to the Excluded Shareholders in Hong Kong dollars, at their own risk, pro rata to their respective entitlements provided that if any of such persons would be entitled to a sum not exceeding HK$100, such sum will be retained by the Company for its own benefit. Any such unsold nil-paid Rights Shares to which such Excluded Shareholders would otherwise have been entitled, together with any Rights Shares provisionally allotted but not accepted by the Qualifying Shareholders or otherwise not subscribed for by transferees of nil-paid Rights Shares, will be available for excess application by the Qualifying Shareholders under the EAF(s).

Basis of provisional allotments

The basis of the provisional allotment shall be three (3) Rights Shares (in nil-paid form) for every ten (10) existing Shares held by the Qualifying Shareholders as at the close of business on the Record Date at the Subscription Price payable in full on acceptance and otherwise on the terms and subject to the conditions set out in the Underwriting Agreement and the Issue Documents.

Application for all or any part of a Qualifying Shareholder’s provisional allotment should be made by completing a PAL and lodging the same with a remittance for the Rights Shares being applied for with the Share Registrar on or before the Acceptance Date.

Subscription Price

The Subscription Price is HK$0.31 per Rights Share, payable in full by a Qualifying Shareholder upon acceptance of the provisional allotment of the Rights Shares under the Rights Issue or applications for excess Rights Shares, or when a transferee of nil-paid Rights Shares applies for the Rights Shares.

The Subscription Price represents:

(i) a discount of approximately 12.68% of the closing price of HK$0.355 per Share as quoted on the Stock Exchange on the Latest Practicable Date;

(ii) a discount of approximately 40.38% to the closing price of HK$0.52 per Share as quoted on the Stock Exchange on the Last Trading Day;

(iii) a discount of approximately 34.32% to the theoretical ex-rights price of approximately HK$0.472 per Share, based on the closing price of HK$0.52 per Share as quoted on the Stock Exchange on the Last Trading Day;

–19– LETTER FROM THE BOARD

(iv) a discount of approximately 40.84% to the average closing prices of approximately HK$0.524 per Share for the last five trading days as quoted on the Stock Exchange up to and including the Last Trading Day; and

(v) a discount of approximately 40.73% to the average closing prices of approximately HK$0.523 per Share for the last ten trading days as quoted on the Stock Exchange up to and including the Last Trading Day.

The Subscription Price and the subscription basis (i.e. three Rights Shares for every 10 existing Shares held) were arrived at after arm’s length negotiations between the Company and the Underwriters with reference to the amount of fund raising targeted by the Company under the Rights Issue, the market price of the Shares under the prevailing market conditions and other comparable transactions in the market recently. Upon determining (i) the target fund raising amount after assessing the funding needs of the Company and (ii) the Subscription Price after considering the discount of the Subscription Price to the closing prices of the Shares acceptable to the Underwriters and the attractiveness to the Qualifying Shareholders to participate in the Rights Issue, the Directors decided on a subscription basis of either one Rights Share for every three existing Shares or three Rights Shares for every ten existing Shares. During the negotiation of the Underwriting Agreement, it has been indicated to the Company that the discount of the Subscription Price to the closing prices of the Shares is necessary to induce the Underwriters to participate in the underwriting of the Rights Shares, which is an essential part of the Rights Issue. The Directors are of the view that in the event that the Subscription Price is increased and the subscription basis is changed to a higher basis, the attractiveness to the Underwriters and also Qualifying Shareholders to participate in underwriting the Rights Issue will likely decrease.

In deciding to set the final subscription basis of three Rights Shares for every ten existing Shares, the Directors consider that a division rate based on ten existing Shares is better than a division basis of three Rights Shares in terms of creation of fractional Shares given that the Directors believe most public minority Shareholders tend to hold their shareholding in board lot size of 1,000 Shares. In addition, the Directors have tried to minimize the difficulties arising from existence of odd lots of Rights Shares arising from the Rights Issue by arranging odd lot matching services for Shareholders. Therefore, having considered the funding needs of the Company in a depressed oil and gas industry, the Directors believe that the subscription price and subscription basis under the Rights Issue are critical for the participation of the Underwriters and also would attract Qualifying Shareholders to reinvest in the Company through the Rights Issue.

–20– LETTER FROM THE BOARD

Notwithstanding that fractional Shares would be created as a result of the subscription basis of three Rights Shares for every ten existing Shares, the Directors consider that given the relatively small fund raising size of the Rights Issue with a limited dilution effect even if no Shareholders elect to participate in the Rights Issue, and the need of the Company to raise funding to pay off bank and other borrowings and for working capital purpose, the existing Subscription Price and subscription basis is the most optimal structure in terms of the highest level of Subscription Price that the Company could agree with the Underwriters and as stated above, given such level of Subscription Price that is acceptable to the Underwriters, the Directors believe that the three Rights Shares for every ten existing Shares subscription basis is better able to minimize the impact of fractional Shares on existing Shareholders as a result of the Rights Issue as compared to one Rights Share for every three existing Shares, whilst allowing the Company to achieve its fund raising target.

Given that each Qualifying Shareholder is entitled to subscribe for the Rights Shares at the same price in proportion to his/her/its existing shareholding in the Company, it will not cause dilution effect if all the Shareholders would have participated in the Rights Issue. The Rights Issue also provides an exit mechanism to those Shareholders who do not want to participate in the Rights Issue by selling out their nil-paid rights. The availability of excess application for the Rights Shares allows those Shareholders, who want to share more the future development of the Company, to apply for more Rights Shares than their respective entitlements to the Rights Shares. The Directors consider that the discount to the Subscription Price is set with an objective to lower the further investment cost of the Shareholders, to encourage them to take up their entitlements and to participate in the potential growth of the Company. The Directors (including the independent non-executive Directors) consider that the discount of the Subscription Price would encourage Shareholders to participate in the Rights Issue and accordingly maintain their shareholdings in the Company and consider that the terms of the Rights Issue (including the rate of commission to be paid to the Underwriters) to be fair and reasonable and in the interests of the Group and the Shareholders as a whole.

Status of Rights Shares

The Rights Shares (when allotted, issued and fully paid) will rank pari passu in all respects with the Shares then in issue. Holders of fully-paid Rights Shares will be entitled to receive all future dividends and distributions which may be declared, made or paid on or after the date of allotment and issue of the fully-paid Rights Shares.

Certificates for the Rights Shares and refund cheques for the Rights Shares

Subject to the fulfilment of the conditions of the Rights Issue, share certificates for all fully-paid Rights Shares are expected to be posted on or about Friday, 8 July 2016 by ordinary post to the allottees, at their own risk, to their registered addresses. Refund cheques in respect of wholly or partially unsuccessful applications for the excess Rights Shares (if any) are expected to be posted on or about Friday, 8 July 2016 by ordinary post to the applicants, at their own risk, to their registered addresses.

–21– LETTER FROM THE BOARD

Fractions of Rights Shares

The Company will not provisionally allot fractions of Rights Shares in nil-paid form to the Qualifying Shareholders. All fractions of Rights Shares will be aggregated (and rounded down to the nearest whole number) and all nil-paid Rights Shares arising from such aggregation will be sold in the market for the benefit of the Company if a premium (net of expenses) can be achieved. Any unsold fractions of Rights Shares will be made available for excess application by the Qualifying Shareholders under the EAF(s).

The Company reserves the right to treat as invalid any acceptances of or applications for the nil-paid Rights Shares where it believes that such acceptance or application would violate the applicable securities or other laws or regulations of any territory or jurisdiction. Furthermore, the Company reserves the right to treat as invalid any purported acceptance of the provisional allotment of Rights Shares comprised in a PAL and/or any application for excess Rights Shares under an EAF or to refuse to register any purported transfer of the rights represented thereby if it appears to the Company or its agents that acceptance of such provisional allotment of Rights Shares or transfer or the registration of such transfer may involve a breach of the laws or regulations of any territory or jurisdiction or if in respect thereof the Shareholder or its agent has not given the declaration set out in the PAL and/or an EAF in respect of such matters.

Procedures for acceptance and payment or transfer

General

Any person (including, without limitation, agents, nominees and trustees) wishing to take up his/her/its rights under the Rights Issue must satisfy himself/herself/itself as to the full observance of the applicable laws of any relevant territory including obtaining any requisite governmental or other consents, observing any other requisite formalities and paying any issue, transfer or other taxes due in such territories. The attention of Shareholders with registered addresses in any of the jurisdictions outside Hong Kong or who hold Shares on behalf of persons, and investors who are located or resided in, with such addresses is drawn to the paragraphs headed “Excluded Shareholders” in this Letter.

The Company may treat as invalid any instruction which appears to the Company to have been despatched from any of the jurisdictions outside Hong Kong and which may involve a breach of the laws of the relevant jurisdictions; or otherwise appears to the Company may involve a breach of the laws of any jurisdiction; or if the Company or its agents believes the same may violate any applicable legal or regulatory requirement.

–22– LETTER FROM THE BOARD

Action to be taken by Qualifying Shareholders

Subscription for all Rights Shares provisionally allotted

A PAL is enclosed with this Prospectus for each Qualifying Shareholder which entitles him/her/it to subscribe for the number of Rights Shares shown in the PAL. If a Qualifying Shareholder wishes to accept all Rights Shares provisionally allotted to him/her/it as specified in the PAL, he/she/it must lodge the PAL in accordance with the instructions printed thereon, together with a remittance for the full amount payable on acceptance, with the Share Registrar, Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong by not later than 4:00 p.m. on Wednesday, 29 June 2016. All remittances must be made by cheque or banker’s cashier order in Hong Kong dollars. Cheques must be drawn on a bank account with, and banker’s cashier orders must be issued by, a licensed bank in Hong Kong and made payable to “Petro-King Oilfield Services Limited – Provisional Allotment Account” and crossed “Account Payee Only”.

It should be noted that unless the PAL, together with the appropriate remittance, has been lodged with the Share Registrar by 4:00 p.m. on Wednesday, 29 June 2016, whether by the original allottee or any person in whose favour the rights have been validly transferred, that provisional allotment and all rights and entitlements thereunder will be deemed to have been declined and will be cancelled. The Company may, at its discretion, treat a PAL as valid and binding on the person(s) by whom or on whose behalf it is lodged even if not completed in accordance with the relevant instructions. The Company may require such incomplete PAL to be completed by the relevant applicants at a later stage.

Transfer and “splitting” of nil-paid Rights Shares

If a Qualifying Shareholder wishes to accept only part of his/her/its provisional allotment or transfer a part of his/her/its rights to subscribe for the Rights Shares provisionally allotted to him/her/it under the PAL or to transfer all or part of his/her/its rights to more than one person, the original PAL must be surrendered and lodged for cancellation not later than 4:30 p.m. on Tuesday, 21 June 2016 with the Share Registrar, who will cancel the original PAL and issue new PALs in the denominations required which will be available for collection at the Share Registrar after 9:00 a.m. on the second Business Day after the surrender of the original PAL. This process is commonly known as “splitting” the nil-paid Rights Shares.

Having “split” the nil-paid Rights Shares, a Qualifying Shareholder who wishes to accept the provisional allotment of Rights Shares represented by a new PAL should do so in accordance with the instructions given above in relation to the subscription for the Rights Shares provisionally allotted.

–23– LETTER FROM THE BOARD

If a Qualifying Shareholder wishes to transfer all of his/her/its nil-paid Rights Shares under a PAL (or a split PAL, as the case may be) to another person, he/she/it should complete and sign the registration information in the PAL and hand the PAL to the person to or through whom he/she/it is transferring his/her/its nil-paid Rights Shares. The transferee must then complete and sign the registration details in the PAL and lodge the PAL intact, together with a remittance for the full amount payable on acceptance with the Share Registrar by no later than 4:00 p.m. on Wednesday, 29 June 2016.

The PAL contains further information regarding the procedures to be followed for acceptance and/or transfer of the whole or part of the provisional allotment of the Rights Shares by the Qualifying Shareholders.

All cheques or banker’s cashier orders will be presented for payment immediately upon receipt and all interest earned on such monies will be retained for the benefit of the Company. Completion and lodgment of a PAL together with a cheque or banker’s cashier order in payment for the Rights Shares applied for will constitute a warranty by the applicant that the cheque or banker’s cashier order will be honoured on first presentation. Without prejudice to its other rights in respect thereof, the Company reserves the right to reject any PAL in respect of which the cheque or banker’s cashier order is dishonoured on first presentation, and in that event the provisional allotment and all rights and entitlements thereunder will be deemed to have been declined and will be cancelled.

No receipt will be given in respect of any application monies received.

The Company reserves the right to refuse to register any transfer in favour of any person in respect of which the Company believes such transfer may violate applicable legal or regulatory requirements.

If any of the conditions of the Rights Issue (as set out in the paragraph headed “Conditions of the Rights Issue and the Underwriting Agreements” in this Letter) is not fulfilled or waived (as applicable), the monies received in respect of acceptances of the Rights Shares will be refunded to the Qualifying Shareholders (or such other persons to whom the Rights Shares in their nil-paid form have been validly transferred) without interest, by means of cheques crossed “Account Payee Only” to be despatched by ordinary post to their registered addresses, and in the case of joint applicants to the registered address of the first-mentioned person who appears on the register of members or the transfer form, at their own risk on or around Friday, 8 July 2016.

Action to be taken by Beneficial Owners whose Shares are held by a Registered Shareholder (other than through CCASS)

If you are a Beneficial Owner whose Shares are registered in the name of a Registered Shareholder and you wish to subscribe for the Rights Shares provisionally allotted to such Registered Shareholder in respect of your Shares, or sell the respective nil-paid Rights Shares or “split” those nil-paid Rights Shares and accept part of the provisional allotment and sell the remaining part, you should contact the Registered Shareholder and provide the Registered Shareholder with instructions or make arrangements with the Registered Shareholder in relation to the acceptance, transfer and/or “splitting” of the nil-paid Rights Shares.

–24– LETTER FROM THE BOARD

Such instructions and/or arrangements should be given or made in advance of the relevant dates stated in the section headed “Expected Timetable” of this Prospectus and otherwise in accordance with the requirements of the Registered Shareholder in order to allow the Registered Shareholder sufficient time to ensure that your instructions are given effect.

Action to be taken by Beneficial Owners holding interests in Shares through CCASS

If you are a Beneficial Owner whose Shares are deposited in CCASS and registered in the name of HKSCC Nominees Limited, and you wish to subscribe for the Rights Shares provisionally allotted to HKSCC Nominees Limited in respect of your Shares, or sell the respective nil-paid Rights Shares or “split” those nil-paid Rights Shares and accept part of the provisional allotment and sell the remaining part, you should (unless you are a CCASS Participant) contact your Intermediary and provide your Intermediary with instructions or make arrangements with your Intermediary in relation to the acceptance, transfer and/or “splitting” of the nil-paid Rights Shares.

Such instructions and/or arrangements should be given or made in advance of the relevant dates stated in the section headed “Expected Timetable” of this prospectus and otherwise in accordance with the requirements of your Intermediary in order to allow your Intermediary sufficient time to ensure that your instructions are given effect. The procedure for acceptance, transfer and/or “splitting” by CCASS Participants of the Rights Shares provisionally allotted to CCASS stock accounts in respect of the Shares registered in the name of HKSCC Nominees Limited shall be in accordance with the “General Rules of CCASS”, the “CCASS Operational Procedures” and any other requirements of CCASS.

Beneficial Owners who are CCASS Participants should contact CCASS and provide CCASS with instructions or make arrangements with CCASS in relation to the manner in which such Beneficial Owners’ interests in nil-paid Rights Shares should be dealt with.

Application for excess Rights Shares

Qualifying Shareholders may apply, by way of excess application, for any unsold entitlements of the Excluded Shareholders, for any Rights Shares provisionally allotted but not accepted by the Qualifying Shareholders or otherwise not subscribed for by transferees of nil-paid Rights Shares and for any unsold Rights Shares arising out of the aggregation of fractional entitlements.

Action to be taken by Qualifying Shareholders who wish to apply for excess Rights Shares

Application for excess Rights Shares can be made only by duly completing and signing an EAF (in accordance with the instructions printed therein) and lodging the same with a separate remittance for the excess Rights Shares being applied for with the Share Registrar, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong by not later than 4:00 p.m. on Wednesday, 29 June 2016.

–25– LETTER FROM THE BOARD

All remittances must be made by cheque or banker’s cashier order in Hong Kong dollars. Cheques must be drawn on a bank account with, and banker’s cashier orders must be issued by, a licensed bank in Hong Kong and made payable to “Petro-King Oilfield Services Limited – Excess Application Account” and crossed “Account Payee Only”.

The Directors will allocate the excess Rights Shares (if any) at their discretion on a fair and equitable basis, according to the principle that any excess Rights Shares will be allocated to Qualifying Shareholders who apply for them on a pro rata basis by reference to the number of excess Rights Shares applied for but no reference will be made to Rights Shares comprised in applications by PAL or the existing number of Shares held by Qualifying Shareholders. No preference will be given to topping up odd lots to whole board lots.

Investors whose Shares are held by nominee(s) (or which are held in CCASS) should note that the Board will regard a nominee company (including HKSCC Nominees Limited) whose name appears on the register of members of the Company as a single Shareholder under the aforesaid arrangement in relation to the allocation of excess Rights Shares. Accordingly, the aforesaid arrangement will not be extended to the beneficial owners individually.

All cheques and banker’s cashier orders will be presented for payment following receipt and all interest earned on such monies will be retained for the benefit of the Company. Completion and lodgment of an EAF together with a cheque or banker’s cashier order in payment for the excess Rights Shares applied for will constitute a warranty by the applicant that the cheque or banker’s cashier order will be honoured on first presentation. Any EAF in respect of which a cheque or banker’s cashier order is dishonoured on first presentation is liable to be rejected.

No receipt will be given in respect of any application monies received.

An EAF is for use only by the person(s) to whom it is addressed and is not transferable. All documents, including cheques or banker’s cashier orders for amounts due, will be sent at the risk of the person(s) entitled thereto to their registered addresses by the Share Registrar. The Company may, at its discretion, treat an EAF as valid and binding on the person(s) by whom or on whose behalf it is lodged even if it has not been completed in accordance with the relevant instructions.

If no excess Rights Shares are allotted and issued to a Qualifying Shareholder, the amount tendered on application is expected to be refunded to that Qualifying Shareholder in full without any interest by means of cheque(s) despatched by ordinary post and at the risk of such Shareholder on or around Friday, 8 July 2016. If the number of excess Rights Shares allotted and issued to a Qualifying Shareholder is less than that applied for, the surplus application monies are also expected to be refunded to such Shareholder without any interest by means of cheque(s) despatched by ordinary post and at the risk of such Shareholder on or before Friday, 8 July 2016.

–26– LETTER FROM THE BOARD

If any of the conditions of the Rights Issue (as set out in the paragraph headed “Conditions of the Rights Issue and the Underwriting Agreements” in this Letter) is not fulfilled or waived (as applicable), the Rights Issue will not proceed and the monies received in respect of applications for excess Rights Shares will be returned without interest to the relevant Qualifying Shareholders and, in the case of joint applicants, to the registered address of the first-mentioned person by means of cheque(s) to be despatched by ordinary post at their own risk on or around Friday, 8 July 2016.

Important notice to Beneficial Owners

Beneficial Owners whose Shares are held by a Registered Owner, or which are held in CCASS, should note that the Board will regard the Registered Owner (including HKSCC Nominees Limited) as a single Shareholder on the register of members of the Company. Accordingly, such Beneficial Owners should note that the above arrangement in relation to the allocation of the excess Rights Shares will not be extended to them individually.

Action to be taken by Beneficial Owners whose Shares are held by a Registered Owner (other than Shares deposited in CCASS) who wish to apply for excess Rights Shares

If you are a Beneficial Owner whose Shares are registered in the name of a Registered Owner and you wish to apply for excess Rights Shares, you should contact the Registered Owner and provide the Registered Owner with instructions or make arrangements with the Registered Owner in relation to such application. Such instructions and/or arrangements should be given or made in advance of the latest time for application and payment for excess Rights Shares stated in the section headed “Expected Timetable” in this Prospectus and otherwise in accordance with the requirements of the Registered Owner, in order to allow the Registered Owner sufficient time to ensure that your instructions are given effect.

Action to be taken by Beneficial Owners holding interests in Shares through CCASS who wish to apply for excess Rights Shares

If you are a Beneficial Owner whose Shares are deposited in CCASS and registered in the name of HKSCC Nominees Limited, and you wish to apply for excess Rights Shares, you should (unless you are a CCASS Investor Participant) contact your Intermediary and provide your Intermediary with instructions or make arrangements with your Intermediary in relation to the application for excess Rights Shares. Such instructions and/or arrangements should be given or made in advance of the date stated in the section headed “Expected Timetable” in this Prospectus and otherwise in accordance with the requirements of your Intermediary, in order to allow your Intermediary sufficient time to ensure that your instructions are given effect.

–27– LETTER FROM THE BOARD

Beneficial Owners who are CCASS Participants should contact CCASS and provide CCASS with instructions or make arrangements with CCASS in relation to any applications for excess Rights Shares. HKSCC Nominees Limited will allocate the excess Rights Shares it receives to the relevant CCASS Participants pro rata to the number of excess Rights Shares each has applied for, or in such other manner as HKSCC Nominees Limited considers fair and appropriate which is pursuant to the allocation basis stipulated in Rule 8.10.4(ix) of the CCASS Operational Procedures. The procedures for application for excess Rights Shares shall be in accordance with the “General Rules of CCASS”, the “CCASS Operational Procedures” and any other requirements of CCASS.

Odd lot matching services

In order to alleviate the difficulties arising from the existence of odd lots of Rights Shares arising from the Rights Issue, the Company has appointed Computershare Hong Kong Investor Services Limited to provide matching service for sale and purchase of odd lots of Rights Shares at the relevant market price per Rights Share, on a best effort basis, to those Shareholders who wish to acquire odd lots of the Rights Shares to make up a full board lot, or to dispose of their holding of odd lots of the Rights Shares. Shareholders who wish to utilise the service should contact Computershare Hong Kong Investor Services Limited at (852) 2862 8555, 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong during the period from Monday, 11 July 2016 to Monday, 1 August 2016, both days inclusive.

Holders of odd lots of the Rights Shares should note that successful matching of the sale and purchase of odd lots of the Rights Shares is not guaranteed. If you are in any doubt as to the above arrangements, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

Application for listing

The Company has applied to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Rights Shares, in both their nil-paid and fully-paid forms. The nil-paid and fully-paid Rights Shares are expected to have the same board lot size as the Shares, i.e. 1,000 Shares in one board lot. No part of the securities of the Company is listed or dealt in or on which listing or permission to deal is being or is proposed to be sought on any other stock exchange. It is expected that dealings in the Rights Shares in nil-paid form will commence on Friday, 17 June 2016 and will end on Friday, 24 June 2016 (both days inclusive) and dealings in the Rights Shares in fully paid form will commence on Monday, 11 July 2016.

–28– LETTER FROM THE BOARD

Stamp duty and other applicable fees and charges

Dealings in the Rights Shares in both their nil-paid and fully-paid forms which are registered in the branch register of members of the Company in Hong Kong will be subject to the payment of stamp duty and any other applicable fees and charges in Hong Kong.

RIGHTS SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS

Subject to the granting of the listing of, and permission to deal in, the Rights Shares in both their nil-paid and fully-paid forms on the Stock Exchange as well as compliance with the stock admission requirements of HKSCC, the Rights Shares in both their nil-paid and fully-paid forms will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect from the respective commencement dates of dealings in the Rights Shares in both their nil-paid and fully-paid forms on the Stock Exchange or such other dates as determined by HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second trading day thereafter. All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures in effect from time to time. Shareholders should seek advice from their stockbroker or other professional adviser for details of those settlement arrangements and how such arrangements will affect their rights and interests.

THE UNDERWRITING AGREEMENTS

On 26 May 2016, the Company and the Underwriters entered into the Underwriting Agreement, the principal terms are set out as the follows:

Date : 26 May 2016 (after trading hours)

Underwriters : Great Wisdom, Greenwoods China Alpha Master Fund and China Galaxy

To the best of the Directors’ knowledge and information:-

(a) Great Wisdom is a company incorporated in Hong Kong with limited liability and is wholly-owned by Mr. Lee Lap, a controlling shareholder of the Company. As of the date of the Underwriting Agreement, Mr. Lee Lap is interested in the 404,754,104 Shares held by Termbray Natural Resources, representing approximately 30.47% of the issued Shares, pursuant to Part XV of the SFO;

–29– LETTER FROM THE BOARD

(b) Greenwoods China Alpha Master Fund, a company incorporated in Cayman Islands with limited liability and a fund managed by Greenwoods Asset Management. As of the date of the Underwriting Agreement, Greenwoods Funds held 72,651,713 Shares, representing approximately 5.47% of the issued Shares;

Total number of Rights : Maximum of 139,692,723 Rights Shares (having Shares being taken into account the Irrevocable Undertakings, underwritten severally Golden China Master Fund Undertaking and by the Underwriters assuming no new Shares being issued and there being no repurchase of Share by the Company on or before the Record Date). The Rights Shares not taken up by Qualifying Shareholders will firstly be underwritten by Great Wisdom for up to 23,000,000 Rights Shares, next be underwritten by Greenwoods China Alpha Master Fund for up to 93,855,659 Rights Shares and the remaining Rights Shares not taken up by Qualifying Shareholders will be underwritten by China Galaxy, for up to 22,837,064 Rights Shares, subject to the terms and conditions of the Underwriting Agreement.

Commission : 1.5% of the sum resulting from multiplying the Subscription Price by the number of Underwritten Shares.

On 10 June 2016, as the number of Underwritten Shares were determined to be 110,526,415 Shares (having taken into account the Irrevocable Undertakings, Golden China Master Fund Undertaking and no new Shares being issued and there being no repurchase of Share by the Company on or before the Record Date), the Company and the Underwriters entered into the Supplemental Underwriting Agreement to re-allocate the Underwritten Shares among the Underwriters as the follows: the Rights Shares not taken up by Qualifying Shareholders will firstly be underwritten by Great Wisdom for up to 23,000,000 Rights Shares, next be underwritten by Greenwoods China Alpha Master Fund for up to 65,716,441 Rights Shares and lastly the remaining be underwritten by China Galaxy for up to 21,809,974 Rights Shares, subject to the terms and conditions of the Underwriting Agreements.

The Rights Issue is fully underwritten by the Underwriters on the terms and conditions of the Underwriting Agreements other than all the Rights Shares that will be provisionally allotted to and which are to be taken up by the Undertaking Covenantors pursuant to the Irrevocable Undertakings on the terms and conditions set out therein. The ordinary course of business of Great Wisdom does not include underwriting.

–30– LETTER FROM THE BOARD

In selecting the underwriters of the Rights Issue, after considering the need to better ensure confidentiality, the need to manage the timing of the Rights Issue and to get a representative picture of the underwriting terms on offer in the market, the Company has approached five potential underwriters, including financial institutions and existing Shareholders. In considering the selection of the Underwriters, the Board had considered several factors, including but not limited to the underwriting capabilities of the Underwriters, the Underwriters’ willingness of underwriting of the Rights Issue, the underwriting commitments offered by the Underwriters, the terms offered by the Underwriters for the Rights Issue and their familiarity of the Company’s business and operation. After making an overall assessment based on the above factors, the Company decided to engage the Underwriters for the purpose of underwriting the Right Issue, upon taking into account, the underwriting terms, including Subscription Price and structure and commission rate that are both acceptable to the Company and the Underwriters. The other two potential underwriters which the Company didn’t follow up with, include a Hong Kong based brokerage house which requested for a larger discount to the Subscription Price and an existing Shareholder, which didn’t provide a positive feedback after considering the underwriting terms proposed by the Company. After considering the diversity of the five potential underwriters that the Company approached and that three of the five potential underwriters are able to accept the underwriting terms proposed by the Company, the Directors did not consider it necessary to approach more potential underwriters.

The Board considers the terms of the Underwriting Agreements including the commission rate accord with the market practice and are fair and reasonable so far as the Company and the Shareholders are concerned.

Conditions of the Rights Issue and the Underwriting Agreements

The Rights Issue and the Underwriting Agreements are conditional upon the following:

(a) the obligations of the Underwriters under the Underwriting Agreements not being terminated in accordance with the terms thereof;

(b) (i) the provisional allotment of the nil-paid Rights Shares to all Qualifying Shareholders and (ii) the provisional allotment of the nil-paid Rights Shares representing the aggregate of fractional entitlements and the entitlements of the Excluded Shareholders which they would otherwise have to the Company’s nominee to be dealt with in accordance with the Underwriting Agreements having been approved by a resolution of the Board on the terms set out in the Issue Documents;

(c) the delivery to the Stock Exchange, and filing and registration with the Share Registrar of Companies in Hong Kong of one copy of each of the Issue Documents duly signed by two Directors (or by their agents duly authorised in writing) as having been approved by a resolution of the Directors (and all other documents required to be attached thereto) not later than the Despatch Date and in compliance with the Listing Rules, the Companies (WUMP) Ordinance and the Companies Ordinance;

–31– LETTER FROM THE BOARD

(d) the posting of the Issue Documents to the Qualifying Shareholders on the Despatch Date;

(e) (i) the Shares remaining listed on the Stock Exchange at all times prior to the Latest Time for Termination and the current listing of the Shares not having been withdrawn or the trading of the Shares not having been suspended for a consecutive period of more than 3 trading days (other than any suspension pending clearance of the 1st Announcement); and (ii) no indication being received on the Latest Time for Termination from the Stock Exchange to the effect that such listing may be withdrawn or objected to including but not limited to as a result of the Rights Issue or in connection with the terms of the Underwriting Agreements or for any other reason;

(f) there being no breach of any provision of the Underwriting Agreements by the Company at all times prior to the Latest Time for Termination;

(g) the representations and warranties of the Company remaining true and accurate and not misleading in all material respects at all times prior to the Latest Time for Termination; and

(h) the Listing Committee of the Stock Exchange granting or agreeing to grant (subject to allotment) listing of and permission to deal in all the Rights Shares either unconditionally or subject to such conditions which the Company (with the unanimous approval of the Underwriters) accepts, in both nil-paid and fully-paid forms and such listing not being withdrawn or revoked.

If any of the above conditions have not been fulfilled (or in respect of conditions (a) or (e)(i) above waived by the Underwriters unanimously at their sole discretion) in all respects by or at the time and/or date specified therefor (or if no time or date is specified 30 June 2016), or such later time as the Underwriters may unanimously agree with the Company, or if the Underwriting Agreements shall be terminated (as described below), the obligations of the Underwriters and the Company under the Underwriting Agreements shall ipso facto cease and determine and no party shall have any claim against any other party in respect of any matter or thing arising out of or in connection with the Underwriting Agreements (save in respect of any antecedent breach of any obligation under the Underwriting Agreements and in respect of any costs, fees and other reasonable out-of-pock expenses of the Underwriters (other than any underwriting commission) which will be borne by the Company).

–32– LETTER FROM THE BOARD

Termination of the Underwriting Agreements

If at any time on or before the Latest Time for Termination:

(b) there occurs any local, national or international event or change, whether or not forming part of a series of events or changes occurring or continuing before, or after the date of the Underwriting Agreement, of a political, military, financial, economic or other nature (whether or not ejusdem generis with any of the foregoing), or in the nature of any local, national or international outbreak or escalation of hostilities or armed conflict, or affecting local securities markets which may, in the reasonable opinion of the Underwriters, materially and adversely affect the business or the financial or trading position or prospects of the Group as a whole; or

then in any such case the Underwriters may, after consultation with the Company or its advisers as the circumstances shall admit, by notice in writing to the Company on its own behalf and on behalf of all other parties thereto (which may be given at any time up to the Latest Time for Termination) rescind the Underwriting Agreements.

Upon rescission of the Underwriting Agreements by the Underwriters, all liabilities of the parties to the Underwriting Agreements will cease and determine and no party will have any claim against any other party in respect of any matter or thing arising out of or in connection with the Underwriting Agreements (save in respect of any antecedent breach of any obligation under the Underwriting Agreements and in respect of any costs, fees and other reasonable out-of-pocket expenses of the Underwriters (other than any underwriting commission) which will be borne by the Company).

–33– LETTER FROM THE BOARD

IRREVOCABLE UNDERTAKINGS BY THE UNDERTAKING COVENANTORS

Pursuant to the respective Irrevocable Undertakings, each of the Undertaking Covenantors has provided an irrevocable and unconditional undertaking to the Company, among other things:

(i) to subscribe for the Rights Shares in the amount set out as follows:

Termbray Natural Resources 121,426,231 Rights Shares King Shine 112,827,724 Rights Shares Jade Win 31,454,648 Rights Shares Greenwoods Funds 21,795,513 Rights Shares Mr. Ko Po Ming 342,857 Rights Shares Mr. Wong Lap Tat Arthur 90,000 Rights Shares

(ii) to deliver the duly completed and signed PALs and all relevant documents to the Share Registrar with payment therefor in accordance with the terms of the Issue Documents on or before the Acceptance Date; and

(iii) not to sell or transfer Shares held by them in any manner before the completion of the Rights Issue.

–34– LETTER FROM THE BOARD

Furthermore, holders of the Directors Options and holders of the Undertaken Options has also undertaken to the Company that they would not exercise the subscription rights under any of the Directors Options before completion of the Rights Issue. Golden China Master Fund has also undertaken not to convert the Convertible Bonds of a principal amount of HK$39 million held by them into Shares and not to sell or transfer such Convertible Bonds held by them before the completion of the Rights Issue.

WARNING OF THE RISKS OF DEALING IN THE SHARES AND NIL-PAID RIGHTS SHARES

Shareholders and potential investors of the Company should note that the Rights Issue is conditional upon, among others, the Underwriting Agreements having become unconditional and the Underwriters not having terminated the Underwriting Agreements in accordance with the terms thereof (a summary of which is set out in the sub-paragraph headed “Termination of the Underwriting Agreements” above). Accordingly, the Rights Issue may or may not proceed.

The Shares have been dealt in on an ex-rights basis from Friday, 3 June 2016. Dealings in the Rights Shares in nil-paid form are expected to take place from Friday, 17 June 2016 to Friday, 24 June 2016 (both days inclusive). Any Shareholder or other person contemplating transferring, selling or purchasing the Shares and/or Rights Shares in their nil-paid form is advised to exercise caution when dealing in the Shares and/or the nil-paid Rights Shares.

Any person who is in any doubt about his/her/its position or any action to be taken is recommended to consult his/her/its own professional adviser(s). Any Shareholder or other person dealing in the Shares or in the nil-paid Rights Shares up to the date on which all the conditions to which the Rights Issue is subject are fulfilled (and the date on which the Underwriters’ right of termination of the Underwriting Agreements ceases) will accordingly bear the risk that the Rights Issue may not become unconditional or may not proceed.

–35– LETTER FROM THE BOARD

CHANGES IN THE SHAREHOLDING STRUCTURE OF THE COMPANY ARISING FROM THE RIGHTS ISSUE

Set out below are the changes in the shareholding structure of the Company arising from the Rights Issue (as no new Shares (other than the Rights Shares) had been issued and there was no repurchase of Shares by the Company on or before the Record Date):

As at the Shareholding immediately after completion of Latest Practicable Date the Rights Issue Assuming none taken up by the Qualifying Shareholders other than Assuming 100% taken up the Undertaking by the Qualifying Covenantors Shareholders Approximate Approximate Approximate %of %of %of the total the total the total issued issued issued No. of Shares Shares No. of Shares Shares No. of Shares Shares

Termbray Natural Resources (Note 1) 404,754,104 30.47% 526,180,335 30.47% 526,180,335 30.47% King Shine (Note 2) 376,092,414 28.32% 488,920,138 28.32% 488,920,138 28.32% Mr.KoPoMing (Note 3) 1,142,857 0.09% 1,485,714 0.09% 1,485,714 0.09% Mr. Wong Lap Tat Arthur (Note 4) 300,000 0.02% 390,000 0.02% 390,000 0.02% Jade Win (Note 5) 104,848,827 7.89% 136,303,475 7.89% 136,303,475 7.89% Greenwoods Funds (Note 6) 72,651,713 5.47% 160,163,667 9.28% 94,447,226 5.47% Great Wisdom – – 23,000,000 1.33% – – China Galaxy – – 21,809,974 1.26% – – Other Shareholders 368,421,379 27.74% 368,421,379 21.34% 478,947,794 27.74%

Total 1,328,211,294 100.0% 1,726,674,682 100.00% 1,726,674,682 100.00%

Notes:

1. 63.99% of the total issued share capital of Termbray Industries International (Holdings) Limited is owned by Lee & Leung (B.V.I.) Limited which is wholly-owned by Lee & Leung Family Investment Limited, which is wholly owned by HSBC International Trustee Limited as trustee for Lee & Leung Family Trust. Mr. Lee Lap is the settlor of the Lee & Leung Family Trust. The discretionary beneficiaries of the Lee & Leung Family Trust are Madam Leung Lai Ping, certain children of Mr. Lee Lap and Madam Leung Lai Ping (including Mr. Lee Tommy, a non-executive Director) and the offspring of such children. Termbray Industries International (Holdings) Limited directly holds 100% of the issued share capital of Termbray Electronics (B.V.I.) Limited which in turn holds 100% of the issued share capital of Termbray Natural Resources, which

–36– LETTER FROM THE BOARD

directly holds approximately 30.47% of the total number of issued Shares of the Company. Therefore, Mr. Lee Lap, Mr. Lee Tommy, HSBC International Trustee Limited, Lee & Leung Family Investment Limited, Lee & Leung (B.V.I.) Limited, Termbray Industries International (Holdings) Limited and Termbray Electronics (B.V.I.) Limited are taken to be interested in the number of shares held by Termbray Natural Resources pursuant to Part XV of the SFO.

2. Mr. Wang Jinlong, an executive Director, holds approximately 45.24% of the issued shares in King Shine and King Shine directly holds approximately 28.32% of the total number of issued Shares of the Company. Therefore, Mr. Wang is taken to be interested in the number of shares held by King Shine pursuant to Part XV of the SFO. Ms. Zhou Xiaojun holds approximately 17.91% of the issued shares in King Shine. Ms. Zhou is the spouse of Mr. Wang. Therefore, Ms. Zhou is deemed to be interested in the Shares in which Mr. Wang is interested for the purpose of the SFO.

3. Mr. Ko Po Ming is a non-executive Director and holds 1,142,857 Shares as of the Latest Practicable Date.

4. Mr. Wong Lap Tat Arthur is a non-executive Director and holds 300,000 Shares as of the Latest Practicable Date.

5. TCL Corporation directly holds 100% of the issued shares of T.C.L. Industries Holdings (H.K.) Limited, which in turn holds 100% of the issued shares of Excel Top Holdings Limited, which in turn holds 100% of the issued shares of Jade Max Holdings Limited, which in turn holds 100% of the issued shares of Jade Win, which directly holds approximately 7.89% of the total number of issued Shares of the Company. Therefore, TCL Corporation, T.C.L. Industries Holdings (H.K.) Limited, Excel Top Holdings Limited and Jade Max Holdings Limited are taken to be interested in the number of Shares held by Jade Win pursuant to Part XV of the SFO.

6. 72,651,713 Shares held by Greenwoods Funds as at the Latest Practicable Date was held as to 70,093,285 by Greenwoods China Alpha Master Fund and 2,558,428 by other Greenwoods Funds.

As no Outstanding Option and Convertible Bonds had been exercised as at the Record Date:

(i) Should each of the Qualifying Shareholders takes up their respective Rights Shares and subscribe in full, the public float should be 41.10%;

(ii) Should none of the Qualifying Shareholders takes up their respective Rights Shares other than the Undertaking Covenantors, the public float should be 39.77%.

As demonstrated in this paragraph in compliance with Rule 8.08 of the Listing Rules, the Company will be able to maintain the minimum public float requirement (i.e. 25%).

–37– LETTER FROM THE BOARD

REASONS FOR THE RIGHTS ISSUE AND USE OF PROCEEDS

The Board had considered alternative fund raising methods, such as share placement or issue of debt or convertible bond. However, given the prevailing market condition and the overall gloomy outlook of the oilfield services industry, it would be difficult to undergo a share placement or any debt or convertible bond issue. In addition as compared to placing or subscription of new Shares, convertible securities or open offer, rights issue will have the least potential dilution impact.

The Board considers that the Rights Issue will enable the Group to strengthen its capital base and to enhance its financial position without increasing its debt or finance costs. Since the Rights Issue will allow the Qualifying Shareholders to maintain their proportional shareholdings in the Company, the Board considers that raising capital through the Rights Issue is in the interest of the Company and the Shareholders as a whole.

The gross proceeds from the Rights Issue will be approximately HK$123.52 million. The estimated net proceeds of the Rights Issue will be approximately HK$120 million and are intended as to approximately HK$90 million for repayment of bank and other borrowings and as to the remaining (approximately HK$30 million) for general working capital purposes.

As at 31 May 2016, the Group had current and non-current bank and other borrowings of HK$111.4 million and HK$174.6 million respectively.

In determining the application of the net proceeds of the Rights Issue, the Board had considered the repayment terms of the outstanding bank and other borrowings and the need for working capital in the next 12 months to settle expenditures, including but not limited to, material costs, employee benefits, rentals, distribution and administration fees, that would arise as the Company continues to develop its business. The Board considered that it is best to utilize the majority of the net proceeds of the Rights Issue to repay bank and other borrowings in order to put the Company in a more healthy and lower gearing financial position, in light of the uncertainty in the US interest rate trend and the volatile capital markets.

The net subscription price per Rights Share is expected to be approximately HK$0.30.

As at 30 April 2016, the Company’s cash and cash equivalents to total assets and net assets were approximately 2.56% and 3.72% respectively. Given such relatively low level, the Board considered it is in the best interest of the Company to conduct a fund raising via the Rights Issue to replenish capital and improve the cash position of the Company.

–38– LETTER FROM THE BOARD

Based on the Board’s latest estimates, the net proceeds from the Rights Issue and the internal funding of the Company is expected to satisfy the Company’s corporate and general working capital needs for the next 12 months after considering factors including, business growth of the Company in the prevailing business environment, the pricing and cost structure, capital expenditure required, repayment of borrowings falling due and general working capital required to sustain normal business operation and growth. Therefore, unless there occurs suitable investment opportunity which requires the Company to make substantial capital contribution, the Company has no other fund raising plan in the next 12 months. The Company currently has not identified any potential investment opportunity.

SHAREHOLDERS’ APPROVAL NOT REQUIRED

As the Rights Issue would not increase either the total issued Shares or the market capitalisation of the Company by more than 50%, the Rights Issue is not required to be approved by the Shareholders in a general meeting under the Listing Rules.

INFORMATION OF THE GROUP

The Group is an investment holding company and its subsidiaries are principally engaged in the provision of oilfield technology and oilfield services covering various stages in the life of an oilfield including drilling, well-completion and production enhancement with ancillary activities in trading and manufacturing of oilfield services related products.

EQUITY FUND RAISING ACTIVITIES IN THE PAST 12 MONTHS

Set out below is the fund raising activities conducted by the Company in the past 12 months immediately preceding the date of the 1st Announcement and up to the Latest Practicable Date:

Amount utilized as at the Latest Practicable Date and Date of initial Fund raising Net proceeds Intended use of actual use of announcement activity raised proceeds proceeds Approximate (HK$) Approximate (HK$)

24 September 2015 Subscription of 72.6 million For the repayment The $72.6 million was new shares of bank used for repayment under specific borrowings and of bank borrowings mandate general working and general capital working capital, as to HK$62.0 million and HK$10.6 million, respectively

–39– LETTER FROM THE BOARD

Save as disclosed above, the Company did not raise any other funds by issue of equity securities during the 12 months immediately preceding the date of the 1st Announcement and up to the Latest Practicable Date.

POSSIBLE ADJUSTMENT TO THE SHARE OPTIONS UNDER THE SHARE OPTION SCHEME AND THE CONVERTIBLE BONDS

The Rights Issue may lead to adjustments to (i) the exercise price and/or the number of Shares to be issued upon exercise of the share options under the Share Option Scheme; and (ii) the conversion price and/or the number of Shares to be issued upon exercise of the conversion right under the Convertible Bonds. The Company will notify the holders of such share options, the holders of Convertible Bonds and the Shareholders by way of announcement (as and when appropriate) regarding adjustments to be made (if any) pursuant to the terms of the Share Option Scheme and the Convertible Bonds and such adjustment will be certified by an independent financial adviser or auditors of the Company (as the case may be).

TAXATION

Shareholders are advised to consult their professional advisers if they are in any doubt as to the taxation implications of the receipt, purchase, holding, exercising, disposing of or dealing in the nil-paid Rights Shares or the Rights Shares and regarding the Excluded Shareholders, their receipt of the net proceeds, if any, from sales of the nil-paid Rights Shares on their behalf.

LATEST DEVELOPMENT AND PROSPECTS OF THE GROUP

The Group have had the following developments since 31 December 2015, being the date to which the latest published audited accounts of the Group were made up):

Following the slump in crude oil price in 2014, the international crude oil price (WTI) dropped further from US$53/bbl at the beginning of year to US$37/bbl at the end of the year. It appears that the market is still bearish about the crude oil price and it is widely believed that the international crude oil price will stay low in 2016. Most of the international oil companies (“IOCs”) as well as the national oil companies (“NOCs”) announced that they will continue to exercise a cautious approach in capital investment plans of their exploration and production (“E&P”) activities.

In the China market, most of the NOCs announced further capital expenditure cut in E&P activities in 2016, it is estimated that the Group’s oilfield service business activities with the NOCs are likely to remain low in 2016. Nevertheless, E&P activities from non-NOCs oil and gas companies show an encouraging growing trend recently. The Directors believe the Group’s business cooperations with these non-NOCs customers can expand the Group’s customer base and is likely to benefit the Group’s business development in the foreseeable future. Since January 2016, the Group has won biddings and contracts of production enhancement services in Ordos Basin and certain turbine drilling service jobs in Tarim Basin.

–40– LETTER FROM THE BOARD

For the overseas market, the Group will continue its marketing and new business development in the Middle East. Since January 2016, the Group has expanded its marketing team in the Middle East by recruiting local expertise for the marketing and promotion of the Group’s down completion tools and services to NOCs of certain countries of the Middle East. Further to the success in business development in Iraq, the Group is proactively promoting its oilfield services and products in various countries in the region (such as Saudi Arabia and Oman). Following the lifting of sanctions on Iran by the United States and the European Union, the Group is considering seeking business cooperation opportunities in Iran. In addition, the Group’s production enhancement services in Central Asia and the Middle East, turbine drilling services in North America, well completion services in South East Asia and Australia that the Group started to provide in 2015 have received high recognition from IOCs customers. However, as most of the IOCs are having a budget cut or delaying their E&P activities in 2016, the Directors believe that this may temporarily limit the Group’s business growth in 2016.

Further, given that the collection of the trade receivables from a major customer in Venezuela remained slow in 2015 as the weak oil price has jeopardised the customer’s capability in settling all of the Group’s trade receivables in a short time, as part of the special risk management action plan, the Group downsized the business operations of its Venezuelan subsidiary to a minimal level and planned to relocate its oilfield service equipment to the Middle East.

Due to the low oil price, IOCs and certain international oilfield service companies are now much more cost cautious about the selecting tools suppliers and service providers in order to save operating costs and improve project profitability. By taking advantages of being a high-end oilfield service provider with self-developed tools and technology, the Group will put more marketing effort on certain potential IOCs customers in the Middle East and provide them with cost competitive service proposals in order to achieve a further market penetration in the region.

Looking ahead to 2016, the Group believes that the operating environment will continue to be a challenging year for the oilfield service sector, especially for the young and growing independent oilfield service companies in China. As the current market environments in China and overseas are still associated with uncertainties, the Group will continue to exercise a cautious approach while seeking business development in 2016.

ADDITIONAL INFORMATION

Your attention is drawn to the additional information set out in the appendices to this Prospectus.

Yours faithfully By order of the Board PETRO-KING OILFIELD SERVICES LIMITED Wang Jinlong Chairman

–41– APPENDIX I FINANCIAL INFORMATION OF THE GROUP

1. FINANCIAL INFORMATION OF THE GROUP

Financial information of the Group for each of the three financial years ended 31 December 2015, respectively is disclosed in the following documents which have been published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (http://www.petro-king.cn/en/):

(i) the audited consolidated financial statements included in the Company’s annual report for the year ended 31 December 2015 (pages 62 to 158) (http://www.hkexnews.hk/listedco/listconews/SEHK/2016/0428/LTN201604281904.pdf);

(ii) the audited consolidated financial statements included in the Company’s annual report for the year ended 31 December 2014 (pages 57 to 160) (http://www.hkexnews.hk/listedco/listconews/SEHK/2015/0423/LTN201504231376.pdf); and

(iii) the audited consolidated financial statements included in the Company’s annual report for the year ended 31 December 2013 (pages 59 to 164) (http://www.hkexnews.hk/listedco/listconews/SEHK/2014/0425/LTN201404251331.pdf).

2. INDEBTENDNESS

Statement of Indebtedness

The exchange rate set out below has been used in the preparation of the statement of indebtedness:RMB 1 = HKD 1.2018

As at 30 April 2016, being the latest practicable date for the purpose of this statement of indebtedness, the Group's total borrowings amounted to HK$216,905,794.

As at 30 April 2016 Note HK$

Bank borrowings 1 68,004,606 Finance lease liabilities 2 12,692,824 Convertible bonds – liability component 3 136,208,364

Total borrowings 216,905,794

Notes:

1. The bank borrowings are secured by:

(a) certain pledged bank deposits amounted to HK$26,328,788;

– I-1 – APPENDIX I FINANCIAL INFORMATION OF THE GROUP

(b) corporate guarantees given by certain subsidiaries of the Group; and

2. The rights to the leased assets are reverted to the lessor in the event of default of the lease liabilities by the Group.

As at 30 April 2016, finance lease liabilities were secured by certain machineries of the Group amounting to HK$24,514,676.

3. On 30 March 2015, the Company issued convertible bonds at a par value HK$157,000,000, bearing interest at the rate of 5% per annum and payable semi-annually in arrears. The net proceeds of the convertible bonds is HK$153,860,000. The maturity date of the convertible bonds will be on 30 March 2018. The holder has the right to convert in whole or part of the principal amount of the bond into shares at a conversion price of HK$1.39 per conversion share at any period commencing from 6 months after the date of issuance of the convertible bonds and up to the close of business on the maturity date. The values of the liability component and the equity conversion component were determined at the completion date of the convertible bonds.

The fair value of the liability component was calculated using a discounted cash flow approach. The key unobservable input of the valuation is the discount rate adopted of 13.6% which is based on market interest rates for a number of comparable convertible bonds denominated in US$ and certain parameters specific to the Group’s liquidity risk. The equity component is recognised initially as the difference between the net proceeds from the bonds and the fair value of the liability component and is included in other reserves in equity. Subsequently, the liability component is carried at amortised cost.

The carrying amounts of the liability and equity components as at 30 April 2016, being the latest practicable date for the purpose of this statement of indebtedness, are as follows:

HK$

Liability component 136,208,364 Equity component 28,462,140

164,670,504

Contingencies

As at 30 April 2016, being the latest practicable date for the purpose of this statement of indebtedness, the Group had the following contingencies:

As at 30 April 2016 HK$

Performance bonds (Note 1) 3,274,627 Litigation claim (Note 2) 29,040,466

32,315,093

– I-2 – APPENDIX I FINANCIAL INFORMATION OF THE GROUP

Notes

1. Performance bonds related to the guarantees provided by the banks to the Group's customers in respect of the sales of tools and equipment or provision of services in certain overseas projects. In the event of non-performance, the customers might call upon the performance bonds and the Group would be liable to the banks in respect of the performance bonds provided.

2. The Group was sued by one of a contracting parties alleging a failure to provide stipulated amount of drilling works under the contracts entered in 2012 and 2013 and claimed for a total amount of RMB24,164,142. The case was concluded on 1 June 2015 in which the judgement of the court is in favour of the Group and has dismissed the claim of the contracting party. The contracting party is in the process of appeal. As at 30 April 2016, restricted deposits of RMB5,000,000 are held at bank as reserve under litigation claim. No provision in relation to this claim has been recognised, as the advice from the Group's legal counsel indicates that it is not probable that there is an outflow of resources embodying economic benefits will be required to settle any obligation and the amount of obligation cannot be reasonably estimated.

On 26 May 2016, the Group entered into an agreement for a loan facility of up to HK$70,000,000 for the purpose of financing the general working capital of the Group. The loan, in the amount of HK$70,000,000 was drawn down on 27 May 2016. Save as aforesaid, the Directors confirmed that there had been no material change to the indebtedness and contingent liabilities of the Group since 30 April 2016 and up to the Latest Practicable Date.

Save as aforesaid and apart from intra-group liabilities, as at the close of business on 30 April 2016, the Group did not have any outstanding loan capital, bank overdrafts, loans, mortgages, charges or other similar indebtedness, or hire purchase of finance lease commitments, liabilities under acceptances or acceptance credits, guarantees or other material contingent liabilities.

3. WORKING CAPITAL

The Directors are of the opinion that, after taking into account the financial resources available to the Group, including the internally generated funds, other borrowings and the estimated net proceeds from the Rights Issue, the Group has sufficient working capital to meet its present working capital requirements, that is for and for at least 12 months from the date of this Prospectus.

4. MATERIAL ADVERSE CHANGE

The Directors confirmed that there had been no material adverse change in the financial or trading position or prospect of the Group since 31 December 2015, the date to which the latest published audited financial statements of the Group were made up, up to and including the Latest Practicable Date.

– I-3 – APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

For illustration purposes, the financial information prepared in accordance with paragraph 4.29 of the Listing Rules is set out here to provide prospective investors with further information about how the financial information of the Group might be affected by completion of the Rights Issue as if the Rights Issue had been completed on 31 December 2015. The statement has been prepared for illustrative purposes only and because of its nature, it may not give a true picture of the Group’s financial position on the completion of the Rights Issue.

1. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS OF THE GROUP

The following is an illustrative and unaudited pro forma adjusted consolidated net tangible assets of the Group attributable to owners of the Company and related notes (the “Unaudited Pro Forma Financial Information”), which have been prepared on the basis of the notes set out below for the purpose of illustrating the effect of the Rights Issue as if it had taken place on 31 December 2015.

The Unaudited Pro Forma Financial Information of the Group is prepared based on the consolidated net tangible assets attributable to owners of the Company as at 31 December 2015, as extracted from the published annual report of the Group, for the year ended 31 December 2015, after incorporating the unaudited pro forma adjustments described in the accompanying notes.

– II-1 – APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

This Unaudited Pro Forma Financial Information of the Group has been prepared for illustrative purposes only, and because of its hypothetical nature, it may not give a true picture of the financial position of the Group on the completion of the Rights Issue.

Unaudited Unaudited pro forma pro forma adjusted adjusted consolidated Consolidated consolidated Consolidated net tangible net tangible net tangible net tangible assets per assets of the assets assets per Share Group attributable to Share attributable to attributable to owners of the attributable to owners of the owners of the Company owners of the Company Company Estimated net after Company after as at proceeds from completion of as at completion of 31 December the Rights the Rights 31 December the Rights 2015 Issue Issue 2015 Issue (Note 1) (Note 2) (Note 3) (Note 4) HK$ million HK$ million HK$ million HK$ million HK$ million

Based on 398,463,388 Rights Shares at the subscription price of HK$0.31 each 1,058.81 120.52 1,179.33 0.80 0.68

Notes:

1. The consolidated net tangible assets of the Group attributable to owners of the Company as at 31 December 2015 is based on the consolidated net assets of the Group attributable to owners of the Company as at 31 December 2015 of HK$1,579.30 million with adjustment for intangible assets of HK$520.49 million as extracted from the published annual report of the Group for the year ended 31 December 2015.

2. The estimated net proceeds from the Rights Issue are based on 398,463,388 Rights Shares to be issued (in the proportion of three (3) Rights Share for every ten (10) Shares held as at the Record Date) at the subscription price of HK$0.31 each, after deduction of the related expenses of approximately HK$3.0 million.

3. The consolidated net tangible assets per Share attributable to owners of the Company as at 31 December 2015 was approximately HK$0.80, which was based on the consolidated net tangible assets of the Group attributable to owners of the Company as at 31 December 2015 of HK$1,058.81 million and 1,328,211,294 Shares in issue as at 31 December 2015.

4. The unaudited pro forma adjusted consolidated net tangible assets per Share is arrived at after the adjustments referred to in the preceding paragraphs (Note 1 and 2) and on the basis that 1,328,211,294 Shares were in issue as at 31 December 2015 and 398,463,388 Rights Shares were issued under the Rights Issue as if the Rights Issue had been completed on 31 December 2015 but takes no account of the exercise of the subscription rights attaching to the Share Options and conversion of the Convertible Bonds.

5. No adjustments have been made to the unaudited pro forma adjusted consolidated net tangible assets of the Group to reflect any trading results or other transactions of the Group entered into subsequent to 31 December 2015.

– II-2 – APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

2. REPORT FROM REPORTING ACCOUNTANT ON UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

The following is the text of a report received from PricewaterhouseCoopers, Certified Public Accountants, Hong Kong, for the purpose of incorporation in this Prospectus.

INDEPENDENT REPORTING ACCOUNTANT’S ASSURANCE REPORT ON THE COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION

To the Directors of Petro-king Oilfield Services Limited

We have completed our assurance engagement to report on the compilation of unaudited pro forma financial information of Petro-king Oilfield Services Limited (the “Company”) and its subsidiaries (collectively the “Group”) by the directors for illustrative purposes only. The unaudited pro forma financial information consists of the unaudited pro forma statement of adjusted consolidated net tangible assets of the Group as at 31 December 2015, and related notes (the “Unaudited Pro Forma Financial Information”) as set out on pages II-1 to II-2 of the Company’s prospectus dated 15 June 2016, in connection with the proposed rights issue of the Company. The applicable criteria on the basis of which the directors have compiled the Unaudited Pro Forma Financial Information are described on pages II-1 to II-2.

The Unaudited Pro Forma Financial Information has been compiled by the directors to illustrate the impact of the proposed rights issue on the Group’s financial position as at 31 December 2015 as if the proposed rights issue had taken place at 31 December 2015. As part of this process, information about the Group’s financial position has been extracted by the directors from the Group’s financial statements for the year ended 31 December 2015, on which an audit report has been published.

Directors’ Responsibility for the Unaudited Pro Forma Financial Information

The directors are responsible for compiling the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”) and with reference to Accounting Guideline 7 “Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars” (“AG 7”) issued by the Hong Kong Institute of Certified Public Accountants (“HKICPA”).

– II-3 – APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

Our Independence and Quality Control

We have complied with the independence and other ethical requirements of the Code of Ethics for Professional Accountants issued by the HKICPA, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behaviour.

Our firm applies Hong Kong Standard on Quality Control 1 issued by the HKICPA and accordingly maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.

Reporting Accountant’s Responsibilities

Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the Listing Rules, on the Unaudited Pro Forma Financial Information and to report our opinion to you. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the Unaudited Pro Forma Financial Information beyond that owed to those to whom those reports were addressed by us at the dates of their issue.

We conducted our engagement in accordance with Hong Kong Standard on Assurance Engagements 3420 “Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus”, issued by the HKICPA. This standard requires that the reporting accountant plans and performs procedures to obtain reasonable assurance about whether the directors have compiled the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.

For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical financial information used in compiling the Unaudited Pro Forma Financial Information, nor have we, in the course of this engagement, performed an audit or review of the financial information used in compiling the Unaudited Pro Forma Financial Information.

The purpose of unaudited pro forma financial information included in a prospectus is solely to illustrate the impact of a significant event or transaction on unadjusted financial information of the entity as if the event had occurred or the transaction had been undertaken at an earlier date selected for purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome of the proposed rights issue at 31 December 2015 would have been as presented.

– II-4 – APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

A reasonable assurance engagement to report on whether the unaudited pro forma financial information has been properly compiled on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by the directors in the compilation of the unaudited pro forma financial information provide a reasonable basis for presenting the significant effects directly attributable to the event or transaction, and to obtain sufficient appropriate evidence about whether:

• The related pro forma adjustments give appropriate effect to those criteria; and

• The unaudited pro forma financial information reflects the proper application of those adjustments to the unadjusted financial information.

The procedures selected depend on the reporting accountant’s judgment, having regard to the reporting accountant’s understanding of the nature of the company, the event or transaction in respect of which the unaudited pro forma financial information has been compiled, and other relevant engagement circumstances.

The engagement also involves evaluating the overall presentation of the unaudited pro forma financial information.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Opinion

In our opinion:

(a) the Unaudited Pro Forma Financial Information has been properly compiled by the directors of the Company on the basis stated;

(b) such basis is consistent with the accounting policies of the Group; and

(c) the adjustments are appropriate for the purposes of the Unaudited Pro Forma Financial Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.

PricewaterhouseCoopers Certified Public Accountants

Hong Kong, 15 June 2016

– II-5 – APPENDIX III GENERAL INFORMATION

1. RESPONSIBILITY STATEMENT

This Prospectus, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this Prospectus is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this Prospectus misleading.

2. SHARE CAPITAL

The authorised and issued Shares of the Company (i) as at the Latest Practicable Date; and (ii) immediately following completion of the Rights Issue (as no new Shares being issued and there being no repurchase of Shares by the Company on or before the Record Date) are set out as follows:

(i) As at the Latest Practicable Date

Authorised:

10,000,000,000 Shares

Issued and fully paid:

1,328,211,294 Shares

(ii) Immediately following the completion of the Rights Issue

Authorised:

10,000,000,000 Shares

Issued and fully paid:

1,328,211,294 Shares in issue before completion of the Rights Issue

398,463,388 Rights Shares to be allotted and issued upon completion of the Rights Issue

1,726,674,682 Shares

– III-1 – APPENDIX III GENERAL INFORMATION

All of the Rights Shares to be issued will rank pari passu in all respect with each other, including, in particular, as to dividends, voting rights and capital, and once issued and fully paid, with all the Shares in issue as at the date of allotment and issue of the Rights Shares. The Rights Shares to be issued will be listed on the Stock Exchange.

No Share or any other securities of the Company is listed or dealt in on any stock exchange other than the Stock Exchange and no application is being made or is currently proposed or sought for the Shares or the Rights Shares or any other securities of the Company to be listed or dealt in on any other stock exchange.

As at the Latest Practicable Date, there were no arrangements under which future dividends are waived or agreed to be waived. Save as disclosed below, the Company has no other outstanding convertible securities, options or warrants, which confer any right to subscribe for or convert or exchange into the Shares.

3. SHARE OPTION SCHEME

As at the Latest Practicable Date, there are outstanding and vested options to subscribe for 24,813,854 Shares granted pursuant to the Share Option Scheme (inclusive of the Directors Options) and the holders of the Directors Options and the Undertaken Options have irrevocably and unconditionally undertaken not to exercise the Share Options before the completion of the Rights Issue. The maximum number of new Shares that would fall to be issued and allotted under the Share Option Scheme would be 12,328,942.

4. CONVERTIBLE BONDS

The Company issued convertible bonds at a par value of HK$157 million on 30 March 2015. The bonds mature three years from the issue date at their nominal value of HK$157 million or can be converted into shares at the holder’s option at the conversion price of HK$1.39 per conversion share (subject to adjustment) at any period commencing from 6 months after the date of issuance of the convertible bonds and up to the close of business on the maturity date. Golden China Master Fund, an affiliated entity of Greenwoods China Alpha Master Fund have undertaken not to convert into Shares and not to sell or transfer HK$39 million worth of Convertible Bonds convertible into 28,057,554 Shares, held by them before the completion of the Rights Issue. The maximum number of new Shares that would fall to be issued and allotted under the Convertible Bonds would be 84,892,086.

– III-2 – APPENDIX III GENERAL INFORMATION

5. BIOGRAPHICAL DETAILS OF DIRECTORS

Executive Directors

Mr. Wang Jinlong (王金龍) (“Mr Wang“), aged 50, is the chairman and an executive Director. He was appointed as an executive Director on 31 December 2007 and is also a director of certain subsidiaries of the Group. Mr. Wang is primarily responsible for long term development strategy of the Group. He has over 20 years of experience in the oil and gas industry. Mr. Wang founded the Group in April 2002 as the executive director and general manager of Petro-king Oilfield Technology Ltd. Prior to that, he worked at 菲利普斯中國有限公司 (Phillips China Inc.) (later known as 康菲石油中國有限公司 (ConocoPhillips China Inc.)) between 1994 and 2003 where he had served as a senior drilling/production engineer. Mr. Wang graduated from 西南石油學院 (Southwest Petroleum Institute*) with a Bachelor of Engineering degree majoring in drilling engineering in July 1986. Mr. Wang obtained a Mid-level Professional Qualification as an engineer in April 1993 issued by 中華人民共和國地質礦產部 (the PRC Ministry of Geology and Mineral Resources*), which was later reformed and incorporated into 中華人民共和國國土資源部 (the PRC Ministry of Land and Resources*), and a qualification of senior engineer issued by CNOOC in March 2002. Mr. Wang has been recognised for his contributions to the development of the technology of geology and was awarded certificates for such contributions by the PRC Ministry of Geology and Mineral Resources in December 1996. Mr. Wang is currently performing the roles of chairman and chief executive officer of the Company. Under code provision A.2.1 of Appendix 14 to the Listing Rules, the roles of chairman and chief executive officer should not be performed by the same individual. Taking into account Mr. Wang’s strong expertise in the oil and gas industry, the Board considered that the roles of chairman and chief executive officer being performed by Mr. Wang enables more effective and efficient overall business planning, decision making and implementation thereof by the Group. In order to maintain good corporate governance and fully comply with the code provisions, the Board will regularly review the need to appoint different individuals to perform the roles of chairman and chief executive officer separately.

* For identification purpose only

– III-3 – APPENDIX III GENERAL INFORMATION

Mr. Zhao Jindong (趙錦棟) (“Mr. Zhao”), aged 52, is the chief executive officer and an executive Director. He joined the Group in 2003 as a vice general manager and was redesigned from Vice President to Chief Executive Officer in April 2016. He was appointed as an executive Director on 24 December 2012 and is also a director of certain subsidiaries of the Group. Mr. Zhao has over 30 years of experience in drilling and completion services of the oil and gas industry. Before joining the Group, Mr. Zhao was the senior drilling and completion engineer at 康菲石油公司 (ConocoPhillips Oil Company) from October 2002 to December 2003. He was employed by ConocoPhillips China Inc. from October 1997 to October 2002 where he was recognised for his exemplary performance and contributions to the operations in Xinjiang. Mr. Zhao started his career as an engineer trainee at 地質礦產部石油鑽井研究所 (Drilling Institute of Minority of Geology*) in December 1983. He continued his employment with the Drilling Institute of Minority of Geology where he became a senior engineer and an assistant manager of the drilling development department. Mr. Zhao graduated from 中國地質大學 (China Geology University*) with a diploma in drilling engineering in 1988.

Non-executive Directors

Mr. Lee Tommy (李銘浚) (“Mr. Lee“), aged 39, is a non-executive Director. He joined the Group in December 2007 as a director of Petro-king Holding Limited. He was appointed as a non-executive Director on 31 December 2007. Mr. Lee has been the vice chairman and chief executive officer of Termbray Industries International (Holdings) Limited since 2008 and 2010 respectively. Mr. Lee was appointed as director of Guangdong Ellington Electronics Technology Company Limited (“Guangdong Ellington”) since 2001. Guangdong Ellington was listed on the Shanghai Stock Exchange (stock code: 603328) since 1 July 2014. He was a vice president of Guangdong Ellington from 2001 to 2008, primarily responsible for the overall management and strategic planning of Guangdong Ellington. Mr. Lee studied Economics in Seneca College of Canada.

Ms. Ma Hua (馬華) (“Ms. Ma“), aged 40, is a non-executive Director. She was appointed as a non-executive Director on 12 June 2012. She is now the managing director of 新疆TCL股權投資有限公司 (TCL Capital*). She was TCL Corporation’s employee from January 2003 to February 2008 acting as the chairman’s corporate secretary. Prior to that, Ms. Ma had already been employed by TCL 國際控股 (TCL International Holdings Ltd.) as an investor relations personnel from July 2001 to January 2003. Ms. Ma Hua obtained her Master of Business Administration from 中國人民大學 (Renmin University of China*) in January 2004 and graduated from 太原理工大學 (Taiyuan Technology University*) with a Bachelor degree double majoring in industry and foreign trade/English language in July 1998.

* For identification purpose only

– III-4 – APPENDIX III GENERAL INFORMATION

Mr. Ko Po Ming (高寶明) (“Mr. Ko“), aged 57, is a non-executive Director. He was appointed as a nonexecutive Director on 18 February 2013. Mr. Ko graduated from The Chinese University of Hong Kong in 1982 with a Bachelor’s degree in Business Administration. Mr. Ko has over 30 years of experience in finance and investment banking business. Prior to co-founding Goldbond Capital Holdings Limited (“GCHL”) in 2003, he was the Head of Asian Corporate Finance of BNP Paribas Peregrine Capital Limited where he was in charge of the corporate finance business in Asia. GCHL was acquired by Piper Jaffray Companies (NYSE: PJC) in 2007 and its name was changed to Piper Jaffray Asia Holdings Limited (“PJA”). Since then and until September 2012, Mr. Ko served as the Chief Executive Officer of PJA. Mr. Ko was a consultant of China Minsheng Banking Corp., Ltd Hong Kong Branch from October 2012 till March 2015. Mr. Ko had acted as independent non-executive directors of a number of Hong Kong and PRC listed companies, including (i) Nanjing Panda Electronics Company Limited (stock code: 553) between 1996 and 1999; (ii) Dazhong Transport (Group) Company Limited (SHA: 600611) between 1997 and 2003; (iii) Chinese Energy Holdings Limited (formerly known as iMerchants Limited (stock code: 8009)) between 2000 and 2004; and (iv) Tianjin Capital Environmental Protection Group Company Limited (stock code: 1065) between 2003 and 2009. He was a Listing Committee member of the Main Board and GEM Board of the Stock Exchange between May 2003 and June 2009. At present, he is the Chief Executive Officer and a director of CMBC International Holdings Limited (a wholly owned subsidiary of China Minsheng Banking Corp., Limited), a non-executive director of Globe Metals and Mining Limited (ASX: GBE) and also a trustee of St. Johnsbury Academy, an independent day and boarding secondary school. St. Johnsbury Academy is a non-profit corporation under section 501(c)(3) of the Internal Revenue Code in the United States of America.

Independent Non-executive Directors

Mr. He Shenghou (何生厚) (“Mr. He“), aged 69, is an independent non-executive Director. He was appointed as an independent non-executive Director on 18 February 2013. Mr. He obtained his diploma in production engineering from 北京石油學院 (Beijing Petroleum Institute, now known as China University of Petroleum*) in July 1970. He has over 40 years of experience in oilfield development engineering and technology research and practice while being employed by Sinopec. Mr. He retired in December 2008 as Sinopec’s vice executive commander. In November 2007, Mr. He was engaged as a committee member of “大型油氣田及煤層氣開發”重大專項實施方案論證委員會 (the “Large-scale oil and GasFields and CBM Development” Major Projects Implementation Planning Committee*) by the NDRC, the Ministry of Finance and the Ministry of Science and Technology. Mr. He has numerous achievements throughout his career. A recent achievement is the receipt of a Scientific Development Award certificate from 中國石油和化學工業聯合會 (China Petroleum and Chemical Industry Federation*) in October 2011.

* For identification purpose only

– III-5 – APPENDIX III GENERAL INFORMATION

Mr. Tong Hin Wor (湯顯和) (“Mr. Tong“), aged 70, is an independent non-executive Director. He was appointed as an independent non-executive Director on 18 February 2013. He holds a diploma in management studies from the Hong Kong Polytechnic University. Mr. Tong has over 30 years of working experience in financial management. He was appointed as an independent non-executive director of Termbray Industries International (Holdings) Limited in 2008 where he has also been serving as a member of the audit committee. Mr. Tong was the group vice president of Elec & Eltek Corporate Services Limited from 1995 to 2004 and the group controller of Elec & Eltek (International) Limited in 1995. He was the financial controller of Karrie Industrial Company Limited, a company principally engaged in electronics and sheet metal manufacturing in 1993.

Mr. Wong Lap Tat Arthur (黃立達) (“Mr. Wong“), aged 56, is an independent non-executive Director. He was appointed as an independent non-executive Director on 18 February 2013. He is also the chairman of the Group’s audit committee. Mr. Wong has more than 30 years of experience in the field of accounting. He is currently the chief financial officer of 北京瑞迪歐文化傳播有限責任公司 (Beijing Radio Cultural Transmission Co., Ltd.*). He was the chief financial officer of GreenTree Inns Hotel Management Group, Inc. from February 2011 to May 2012. He had also previously acted as the chief financial officer of Nobao Renewable Energy Holdings Limited from March 2010 to November 2010 and of Asia New- Energy Holdings Pte. Ltd. from June 2008 to December 2009. Prior to that, Mr. Wong built his career at Deloitte Touche Tohmatsu (“Deloitte”) from July 1982 to May 2008 where he left as a partner of the Beijing office. Mr. Wong received a Bachelor of Science in applied economics from the University of San Francisco in 1988 and completed a higher diploma of accountancy at Hong Kong Polytechnic University in 1982. He obtained his CPA accreditation from both the American Institute of CPAs and the Hong Kong Institute of CPAs. He is also a member of the Chartered Association of Certified Accountants. He was an independent non-executive director and the chair of the audit committee of Besunyen Holdings Company Limited (stock code: 926) and You On Demand Holdings, Inc. (NASDAQ: YOD) until 23 April 2014 and 11 April 2016 respectively. He is currently an independent non-executive director and the chair of the audit committee of Sky Solar Holdings, Ltd. (NASDAQ: SKYS), China Maple Leaf Educational Systems Limited (HKSE: 1317), VisionChina Media Inc. (NASDAQ: VISN), China Automotive Systems, Inc. (NASDAQ: CAAS) and Daqo New Energy Corp. (NYSE: DQ), as well as an independent director and the chairman of the compensation committee of Xueda Education Group (NYSE: XUE).

– III-6 – APPENDIX III GENERAL INFORMATION

Positions and addresses of the Directors

Name of Director Position Address

Mr. Wang Jinlong Chairperson and Flat A, 4th Floor, Tak On Mansion, Executive Director 1-11 Pine Street, Tai Kok Tsui, Kowloon, Hong Kong

Mr. Zhao Jindong Chief Executive Office 5A Yi Youge, Lanyi Garden, and Executive Shekou, Nanshan District, Director Shenzhen, Guangdong, PRC

Mr. Ko Po Ming Non-executive Director Flat A, 21/F, Block 9, The Palazzo, 28 Lok King Street, Fo Tan, Shatin, New Territories, Hong Kong

Mr. Lee Tommy Non-executive Director Flat A, 15th Floor, Tower 3, 37 Repulse Bay Road, Repulse Bay, Hong Kong

Ms. Ma Hua Non-executive Director 3039 Bao’an North Road, Luohu District, Shenzhen, Guangdong Province, China

Mr. He Shenghou Independent Room 808, 6F, Block 6, He Ping Li, Non-Executive Dongcheng District, Director Beijing, China

Mr. Tong Hin Independent Flat E, 10/F, Block 3, Wor Non-Executive Le Bleu Deux, Coastal Skyline, Director 12 Waterfront Road, Tung Chung, New Territories, Hong Kong

Mr. Wong Lap Tat Independent 1208 Dragon Bay Villa, Arthur Non-Executive Hou Sha Yu, Shunyi District, Director Beijing 101302, China

– III-7 – APPENDIX III GENERAL INFORMATION

Senior Management

Ms. Sun Jinxia (孫金霞) (“Ms. Sun“), aged 41, is a vice president. She is also a director of certain subsidiaries of the Group. Ms. Sun is responsible for the Group’s daily operation of the business department, purchase department, HR & Admin department, Venezuelan Market, HSE department, and quality assurance department. She joined the Group in 2003 as an assistant to general manager. She has over 15 years of experience in business management. Ms. Sun was a sales manager of 深圳威尼斯酒店 (the Venice Hotel Shenzhen*) between October 2001 and July 2002. Prior to that, she was a sales supervisor and sales manager of 深圳南海酒店有限公司 (Shenzhen Nanhai Hotel Limited*) from July 1997 to April 1998 and from April 1998 to June 2000, respectively. She completed her Master of Business Administration at the University of Ballarat, Australia in July 2004.

Mr. Zhang Taiyuan (張太元) (“Mr. Zhang“), aged 51, is a vice president. He is also a director of certain subsidiaries of the Group. He joined the Group in 2004 as a senior drilling supervisor and has been subsequently promoted to director of international projects and also to vice president. Mr. Zhang has over 25 years of experience in project management and drilling engineering of the oil and gas industry. He was an offshore drilling supervisor of Devon Energy China Ltd. prior to joining the Group from December 2002 to December 2004. Between January 2002 and December 2002, he was a project manager of CNPC. Mr. Zhang acted as a CNPC engineering professional representative for CNPC-Burlington (then known as CNPC-ENRON) from October 1997 to January 2002. Prior, he was employed by 川中油氣公司 (Chuanzhong Oil and Gas Company of SPA*) from August 1986 where he acted as a drilling engineer. He graduated from 西南石油學院 (Southwest Petroleum Institute*) in 1986 with a Bachelor of Engineering degree, majoring in drilling engineering.

Mr. Shu Wa Tung Laurence (舒華東) (“Mr. Shu“), aged 43, joined the Group in July 2010 as the Group’s chief financial officer and he is primarily responsible for the Group’s overall financial strategies and daily management of the Group’s financial, accounting and legal functions. Mr. Shu graduated from Deakin University, Australia in 1994 with a Bachelor degree in Business majoring in Accounting. He received his CPA accreditation from both the Hong Kong Institute of CPAs and the Australian Society of CPAs in 1997 and completed his CFO Programme at 中歐國際工商學院 (China Europe International Business School) in 2009. Mr. Shu has over 20 years of experience in audit, corporate finance, and financial management. He joined Deloitte in 1994 and later became a manager of the Reorganisation Services Group of Deloitte and joined Deloitte & Touche Corporate Finance Limited (a corporate finance service company of Deloitte) as a manager from 2001 to 2002. From 2002 to 2005, Mr. Shu was an associate director of Goldbond Capital (Asia) Limited. From May 2005 to July 2008, he served as the chief financial officer and company secretary of Texhong Textile Group Limited (stock code: 2678) overseeing the group’s financial management functions. From July 2008 to June 2010, Mr. Shu served as the chief financial officer of Rongsheng Heavy Industries Holdings

* For identification purpose only

– III-8 – APPENDIX III GENERAL INFORMATION

Limited (熔盛重工控股有限公司) and oversaw the group’s financial management functions and corporate finance activities as well as the daily management of the group’s finance department.

Mr. Xie Qingfan (謝慶繁) (“Mr. Xie“), aged 52, is a vice president and chief engineer primarily responsible for the research and development of technologies for the Group, the organization and division, of the technical management of the Group and standardization of the management of technologies. He joined the Group in 2006 as the manager of the northwest region. Mr. Xie has over 30 years of experience in the oil and gas industry. He had acted in various roles during his employment with 中石化中原石油勘探局 (Sinopec Zhongyuan Petroleum Exploration Bureau) between 1982 to 2005; such as engineering service centre director of the 鑽井工程技術研究院 (Drilling Engineering and Technology Research Institute*) in 2001, deputy chief engineer of the 鑽井管具工程處 (Drilling Pipe Tool Engineering Department*) in 2002, and senior engineer in 2005. He received numerous certificates for his contributions to this bureau from as early as 1985. For instance, he was presented with a Technology Advancement Certificate for his research on technology to prevent failure of drilling tools in February 2006 and for his research and development of PDC drill heads in February 2003. Mr. Xie completed a training course of electrical wireline freepoint & backoff provided by HOMCO in 1993 and received training for the operation of motorized freepoint equipment held by Applied Electronic Systems, Inc. in 2001. He graduated from 石油大學 (Petroleum University*) with a Bachelor degree majoring in mine machinery in July 1996.

Mr. Yuan Fucun (袁夫存) (“Mr. Yuan“), aged 46, is a vice president. He joined the Group in 2013 and he is primarily responsible for the management of some international projects, ISPM engineering department, unconventionality oil & gas services, oilfield surface engineering business department, exploration & production department, and several other departments. Mr. Yuan has over 20 years of experience in offshore drilling and completion management of the oil and gas industry. Mr. Yuan was employed as Drilling Manager, Senior Drilling Engineer, Drilling Superintendent of Schlumberger Group, and responsible for IPM integrated project management and drilling engineering and technical services in Russia, the Middle East, Algeria. He was highly praised for his outstanding performance and contributions. Mr. Yuan has worked for Conoco Phillips China Inc. for 12 years, and worked as Xijiang Drilling, Completion Services Manager, Senior Reservoir, Production Engineer, Senior Drilling Engineer, Senior Production, Completion Engineer, Engineers and so on. Mr. Yuan graduated from 西南石油學院 (Southwest Petroleum Institute*) with a Bachelor of Engineering, majoring in offshore petroleum engineering in 1992 and obtained a master degree (EMBA) from Hong Kong University of Science and Technology in 2014.

* For identification purpose only

– III-9 – APPENDIX III GENERAL INFORMATION

Mr. Pan Yuxin (潘玉新) (“Mr. Pan“), aged 40, is a vice president. He joined the Group in 2011 and he is primarily responsible for the management of domestic market. Mr. Pan has over 20 years of experience in oil and gas service industry. He has worked as Northeast Project Manager, North China Project Manager, Southwest Project Manager, Marketing Director and Vice President for 北京一龍恒業石油工程技有限公司. He has worked as field and sales department manager for Anton Oilfield Services Group. He has been in charge of water injection station, oil production station and oil producing region for Zhongyuan oilfield. Mr. Pan graduated in July 1995 from the Zhongyuan Oilfield Petroleum School and graduated from China PLA Institute of Engineering Corps undergraduate in June 2013.

Mr. Lin Jingyu (林景禹) (“Mr. Lin“), aged 42, is a vice president. Mr. Lin Jingyu is responsible for the engineering and technology of the Group’s production enhancement department and Jiaoshiba project department. He joined the Group in 2008 as a senior engineer. He has over 20 years of experience in the exploration and development technology of oilfields. From July 2006 to August 2008, Mr. Lin Jingyu served as the vice president and senior engineer of the Acid Fracturing Research Centre of the Research Institute of Petroleum Engineering and Technology of Sinopec Henan Oilfield Company (中石化河南油田分公司石油工程技術研究院壓裂酸化研究所). Before then, he was the office director and engineer of the Acid Fracturing Research Centre of the Research Institute of Petroleum Engineering and Technology of Henan Oilfield Company. From July 1996 to July 2000, he was the assistant engineer of Henan Oilfield and Oil Production Technology Research Institute (河南油田採油工藝研究所). Before then, Mr. Lin Jingyu obtained a Master degree in oil, gas and oilfields exploration from the School of Petroleum Engineering of Yangtze University (formerly known as Jianghan Petroleum Institute) (長江大學石油工程學院（原江漢石油學院）). From September 1992 to June 1996, he obtained a Bachelor degree in petroleum engineering from Xi’an Petroleum Institute (西安石油學院). In addition, Mr. Lin Jingyu participated in international investment and project management for oil and gas exploration and development in Imperial College London during September 2005 to March 2006.

– III-10 – APPENDIX III GENERAL INFORMATION

Positions and addresses of the Senior Management

Name of Senior Management Position Business address

Ms. Sun Jinxia Vice President F/7, Building A, Tiley Central Plaza, No. 3 Haide Road, NanShan District, ShenZhen, GuangDong, P.R.China

Mr. Zhang Vice President F/7, Building A, Taiyuan Tiley Central Plaza, No. 3 Haide Road, NanShan District, ShenZhen, GuangDong, P.R.China

Mr. Shu Wa Tung Chief Financial Officer F/7, Building A, Laurence Tiley Central Plaza, No. 3 Haide Road, NanShan District, ShenZhen, GuangDong, P.R.China

Mr. Xie Qingfan Vice President and F/7, Building A, Chief Engineer Tiley Central Plaza, No. 3 Haide Road, NanShan District, ShenZhen, GuangDong, P.R.China

Mr. Yuan Fucun Vice President F/7, Building A, Tiley Central Plaza, No. 3 Haide Road, NanShan District, ShenZhen, GuangDong, P.R.China

Mr. Pan Yuxin Vice President F/7, Building A, Tiley Central Plaza, No. 3 Haide Road, NanShan District, ShenZhen, GuangDong, P.R.China

– III-11 – APPENDIX III GENERAL INFORMATION

Name of Senior Management Position Business address

Mr. Lin Jingyu Vice President F/7, Building A, Tiley Central Plaza, No. 3 Haide Road, NanShan District, ShenZhen, GuangDong, P.R.China

Company Secretary

Mr. Tung Tat Chiu, Michael (佟達釗) (“Mr. Tung“), aged 54, was appointed as the company secretary of the Company on 18 February 2013. He is the senior partner of Tung & Co., a law firm providing legal advice as to Hong Kong laws to the Group since 2007. He holds a Bachelor of Arts degree in law and accounting from The University of Manchester, the United Kingdom. He has over 20 years of experience as practising lawyer in Hong Kong. He is also a China-Appointed Attesting Officer. Mr. Tung currently serves as a joint company secretary of Jiangxi Copper Company Limited (stock code: 358), Harbin Electric Company Limited (stock code: 1133) and Qingling Motors Co. Ltd (stock code: 1122) and the sole company secretary of Yunbo Digital Synergy Group Limited (stock code: 8050), respectively. He is currently the internal legal adviser of Silver Grant International Industries Limited (stock code: 171).

– III-12 – APPENDIX III GENERAL INFORMATION

6. DIRECTORS’ AND CHIEF EXECUTIVE’S INTERESTS AND SHORT POSITIONS IN THE SHARES, UNDERLYING SHARES AND DEBENTURES OF THE COMPANY AND ITS ASSOCIATED CORPORATION

As at the Latest Practicable Date, the interests and short positions of the Directors and chief executive in the Shares, underlying Shares and debentures of the Company or any of its associated corporation (within the meaning of Part XV of the SFO), which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under such provisions of the SFO); or were otherwise required pursuant to section 352 of the SFO to be entered in the register referred to therein; or were required pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (the “Model Code”) to be notified to the Company and the Stock Exchange, were as follows:

Interests in Shares and Underlying Shares of the Company

Approximate Number of percentage of Shares interest in the Name of Director Capacity/ Nature of interest (Note 1) Company

Mr. Wang Jinlong Interest in a controlled 488,920,138(L) 36.81% Corporation (Note 2) Beneficial owner (Note 4) 102,173(L) 0.008%

Mr. Lee Tommy Beneficiary of trust (Note 3) 526,180,335(L) 30.47% Beneficial owner (Note 4) 102,173(L) 0.008%

Mr. Ko Po Ming Beneficial owner (Note 5) 1,485,714(L) 0.11% Beneficial owner (Note 4) 102,173(L) 0.008%

Mr. Zhao Jindong Beneficial owner 2,602,173(L) 0.20% (Note 4 and 6)

Ms. Ma Hua Beneficial owner (Note 4) 102,173(L) 0.008%

Mr. He Shenghou Beneficial owner (Note 4) 102,173(L) 0.008%

Mr. Tong Hin Wor Beneficial owner (Note 4) 102,173(L) 0.008%

Mr. Wong Lap Tat Beneficial owner (Note 7) 390,000(L) 0.03% Arthur Beneficial owner (Note 4) 102,173(L) 0.008%

– III-13 – APPENDIX III GENERAL INFORMATION

Notes:

1. “L” denotes long position.

2. Mr. Wang Jinlong holds approximately 45.24% of the issued share capital in King Shine and King Shine directly holds approximately 28.32% of the total number of issued shares of the Company. Therefore, Mr. Wang is taken to be interested in the number of Shares held by King Shine pursuant to Part XV of the SFO. These Shares include 376,092,414 Shares beneficially owned by King Shine and 112,827,724 nil-paid Rights Shares for which King Shine has irrevocably and unconditionally undertaken to subscribe pursuant to its Irrevocable Undertaking.

3. 63.99% of the total issued share capital of Termbray Industries International (Holdings) Limited (“Termbray Industries”) is owned by Lee & Leung (B.V.I.) Limited which is wholly-owned by Lee & Leung Family Investment Limited, which is wholly owned by HSBC International Trustee Limited as trustee for Lee & Leung Family Trust. Mr. Lee Lap is the settlor of the Lee & Leung Family Trust. The discretionary beneficiaries of the Lee & Leung Family Trust are Madam Leung Lai Ping, certain children of Mr. Lee Lap and Madam Leung Lai Ping (including Mr. Lee Tommy, a nonexecutive Director) and the offspring of such children. Termbray Industries directly holds 100% of the issued share capital of Termbray Electronics (B.V.I.) Limited (“Termbray Electronics (BVI)”) which in turn holds 100% of the issued share capital of Termbray Natural Resources. Therefore, Mr. Lee Lap, Mr. Lee Tommy, HSBC International Trustee Limited, Lee & Leung Family Investment Limited, Lee & Leung (B.V.I.) Limited, Termbray Industries and Termbray Electronics (BVI) are taken to be interested in the number of Shares held by Termbray Natural Resources pursuant to Part XV of the SFO. Pursuant to its Irrevocable Undertaking, Termbray Natural Resources has irrevocably and unconditionally undertaken to subscribe for 121,426,231 nil-paid Rights Shares.

4. 100,000 share options were granted to each of the Directors on 29 April 2014 pursuant to the Share Option Scheme and were adjusted to 102,173 share options after the completion of the rights issue of the Company on 4 February 2015. Therefore under Part XV of the SFO, the Directors are taken to be interested in the underlying shares that they are entitled to subscribe for subject to the exercise of the share options granted.

5. Mr. Ko Po Ming is interested 1,485,714 Shares which include 1,142,857 Shares beneficially owned by him and 342,857 nil-paid Rights Shares for which he has irrevocably and unconditionally undertaken to subscribe pursuant to his Irrevocable Undertaking.

6. 2,500,000 share options were conditionally granted to Mr. Zhao Jindong on 29 May 2015 and became unconditional on 7 September 2015. Therefore under Part XV of the SFO, Mr. Zhao Jindong is taken to be interested in the underlying shares that he is entitled to subscribe for subject to the exercise of the share options granted.

7. Mr. Wong Lap Tat Arthur is interested 390,000 Shares which include 300,000 Shares beneficially owned by him and 90,000 nil-paid Rights Shares for which he has irrevocably and unconditionally undertaken to subscribe pursuant to his Irrevocable Undertaking.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors had or was deemed to have any interests or short positions in the Shares, underlying Shares or debentures of the Company or in the shares, underlying shares or debentures of any of the associated corporations of the Company (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which he/she was taken or deemed to have under such provisions of the SFO); or were otherwise required pursuant to section 352 of the SFO to be entered in the register referred to therein; or were required pursuant to the Model Code to be notified to the Company and the Stock Exchange.

– III-14 – APPENDIX III GENERAL INFORMATION

7. SUBSTANTIAL SHAREHOLDERS’ INTERESTS AND SHORT POSITIONS IN THE SHARES AND UNDERLYING SHARES

Save as disclosed below, as at the Latest Practicable Date, according to the register of interest kept by the Company under section 336 of the SFO and so far as is known to any Directors, no other person nor company (other than the Directors whose interests are disclosed above) had an interest or a short position in the Shares or underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other principal members of the Group or had any option in respect of such capital:

Interests of substantial shareholders of the Company

Approximate percentage of Number of shareholding Name of Shares in the Shareholder Capacity/ Nature of interest (Note 1) Company

Mr. Lee Lap Settlor of a discretionary 549,180,335(L) 31.81% trust (Note 2 and 3)

HSBC International Trustee (Note 2) 526,180,335(L) 30.47% Trustee Limited

Lee & Leung Interest in a controlled 526,180,335(L) 30.47% Family corporation (Note 2) Investment Limited

Lee & Leung (B.V.I.) Interest in a controlled 526,180,335(L) 30.47% Limited corporation (Note 2)

Termbray Interest in a controlled 526,180,335(L) 30.47% Industries corporation (Note 2) International (Holdings) Limited

Termbray Interest in a controlled 526,180,335(L) 30.47% Electronics corporation (Note 2) (B.V.I.) Limited

Termbray Natural Beneficial owner 526,180,335(L) 30.47% Resources

– III-15 – APPENDIX III GENERAL INFORMATION

Approximate percentage of Number of shareholding Name of Shares in the Shareholder Capacity/ Nature of interest (Note 1) Company

TCL Corporation Interest in a controlled 136,303,475(L) 10.26% corporation (Note 4)

T.C.L. Industries Interest in a controlled 136,303,475(L) 10.26% Holdings (H.K.) corporation (Note 4) Limited (“TCL HK”)

Excel Top Holdings Interest in a controlled 136,303,475(L) 10.26% Limited corporation (Note 4)

Jade Max Holdings Interest in a controlled 136,303,475(L) 10.26% Limited corporation (Note 4)

Jade Win Beneficial owner 136,303,475(L) 10.26% Investment Limited

Ms. Zhou Xiaojun Interest of spouse (Note 5) 489,022,311(L) 36.82%

King Shine Beneficial owner (Note 6) 488,920,138(L) 36.81%

UBS Group AG Person having a security 70,093,285(L) 5.28% interest in shares (Note 7)

Interest in a controlled 670,857(L) 0.05% corporation (Note 7) 670,857(S) 0.05%

UBS AG Beneficial owner (Note 8) 670,857(L) 0.05% 670,857(S) 0.05%

Person having a security 70,093,285(L) 5.28% interest in shares (Note 8)

Greenwoods Asset Interest in a controlled 72,651,713(L) 5.47% Management corporation (Note 9) Holdings Limited

– III-16 – APPENDIX III GENERAL INFORMATION

Approximate percentage of Number of shareholding Name of Shares in the Shareholder Capacity/ Nature of interest (Note 1) Company

Greenwoods Asset Interest in a controlled 2,558,428 0.19% Management corporation (Note 9) Limited

Interest in a controlled 70,093,285 5.28% corporation (Note 9)

Notes:

1. “L” denotes long position and “S” denotes short position.

2. 63.99% of the total issued share capital of Termbray Industries is owned by Lee & Leung (B.V.I.) Limited which is wholly-owned by Lee & Leung Family Investment Limited, which is wholly owned by HSBC International Trustee Limited as trustee for Lee & Leung Family Trust. Mr. Lee Lap is the settlor of the Lee & Leung Family Trust. The discretionary beneficiaries of the Lee & Leung Family Trust are Madam Leung Lai Ping, certain children of Mr. Lee Lap and Madam Leung Lai Ping (including Mr. Lee Tommy, a non-executive Director) and the offspring of such children. Termbray Industries directly holds 100% of the issued share capital of Termbray Electronics (BVI) which in turn holds 100% of the issued share capital of Termbray Natural Resources. Therefore, Mr. Lee Lap, Mr. Lee Tommy, HSBC International Trustee Limited, Lee & Leung Family Investment Limited, Lee & Leung (B.V.I.) Limited, Termbray Industries and Termbray Electronics (BVI) are taken to be interested in the number of Shares held by Termbray Natural Resources pursuant to Part XV of the SFO. Pursuant to its Irrevocable Undertaking, Termbray Natural Resources has irrevocably and unconditionally undertaken to subscribe for 121,426,231 nil-paid Rights Shares.

3. These Shares include 23,000,000 Rights Shares underwritten by Great Wisdom pursuant to the Underwriting Agreements.

4. TCL Corporation directly holds 100% of the issued share capital of TCL HK, which in turn holds 100% of the issued share capital of Exceltop Holdings Limited, which in turn holds 100% of the issued share capital of Jade Max Holdings Limited, which in turn holds 100% of the issued share capital of Jade Win Investment Limited. Therefore, TCL Corporation, TCL HK, Excel Top Holdings Limited and Jade Max Holdings Limited are taken to be interested in the number of Shares held by Jade Win Investment Limited pursuant to Part XV of the SFO. Pursuant to its Irrevocably Undertaking, Jade Win has irrevocably and unconditionally undertaken to subscribe for 31,454,648 nil-paid Rights Shares.

5. Ms. Zhou holds approximately 17.91% of the issued share capital in King Shine. Ms. Zhou is the spouse of Mr. Wang. Therefore, Ms. Zhou is deemed to be interested in the Shares in which Mr. Wang is interested for the purpose of the SFO.

6. These Shares include 376,092,414 Shares beneficially owned by King Shine and 112,827,724 nil-paid Rights Shares for which King Shine has irrevocably and unconditionally undertaken to subscribe pursuant to its Irrevocable Undertaking.

7. According to the corporate substantial shareholder notice filed by UBS Group AG on 9 February 2015, the interests include (i) 83,857 shares in long position and 83,857 shares in short position held in cash settled derivatives listed or traded on a Stock Exchange or traded on a Futures Exchange and (ii) 587,000 shares in short position held in cash settled unlisted derivatives.

8. According to the corporate substantial shareholder notice filed by UBS AG on 9 February 2015, interests include (i) 83,857 Shares in long position and 83,857 shares in short position held in cash settled derivatives listed or traded on a Stock Exchange or traded on a Futures Exchange and (ii) 587,000 Shares in short position held in cash settled unlisted derivatives.

9. Greenwoods Asset Management Holdings Limited was interested in 72,651,713 Shares as at Latest Practicable Date which were ultimately held as to 70,093,285 by Greenwoods China Alpha Master Fund and 2,558,428 by other Greenwoods Funds. Pursuant to their Irrevocably Undertaking, Greenwoods Funds have irrevocably and unconditionally undertaken to subscribe for an aggregate of 21,795,513 nil-paid Rights Shares. Pursuant to the Underwriting Agreements, Greenwoods China Alpha Master Fund has underwritten for an aggregate of 65,716,441 Shares.

– III-17 – APPENDIX III GENERAL INFORMATION

Save as disclosed above, as at the Latest Practicable Date, the Directors are not aware that there is any party (not being a Director) who had any interest or short position in the shares or underlying shares of the Company which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who was, directly or indirectly, interested in 5% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or any options in respect of such shares.

8. DIRECTORS’ SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contracts with any member of the Group which will not expire or is not determinable by the Group within one year without payment of compensation other than statutory compensation.

9. DIRECTORS’ INTERESTS IN THE GROUP’S ASSETS OR CONTRACTS OR ARRANGEMENTS SIGNIFICANT TO THE GROUP

As at the Latest Practicable Date, none of the Directors had any interest in any assets which have been, since 31 December 2015 (being the date to which the latest published audited accounts of the Company were made up), acquired or disposed of by or leased to any member of the Group, or are proposed to be acquired or disposed of by or leased to any member of the Group.

As the Latest Practicable Date, none of the Directors was materially interested in any contract or arrangement, subsisting at the date of this Prospectus, which is significant to the business of the Group.

10. QUALIFICATION AND CONSENTS OF EXPERTS

The following are the qualifications of the experts who have given statement or opinion or advise for inclusion in this Prospectus:

Name Qualification

PricewaterhouseCoopers Certified Public Accountants

Conyers Dill & Pearman BVI legal adviser

Each of the above mentioned experts has given and has not withdrawn its written consent to the issue of this Prospectus with the inclusion of its report and/or legal opinion (as the case maybe) and references to its name in the form and context in which they appear herein.

As at the Latest Practicable Date, each of the above mentioned experts did not have any direct or indirect interest in any securities of any member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group nor did they have any interest, either directly or indirectly, in any assets which had been, since 31 December 2015 (being the date to which the latest published audited financial statements of the Company were made up), acquired or disposed of by or leased to or were proposed to be acquired or disposed of by or leased to any member of the Group.

– III-18 – APPENDIX III GENERAL INFORMATION

11. CORPORATE INFORMATION

Registered office Commerce House Wickhams Cay 1 P.O. Box 3140 Road Town, Tortola British Virgin Islands VG1110

Principal place of Office No. 504, 5th Floor business in Hong Kong Tower 1, Silvercord No. 30 Canton Road Kowloon, Hong Kong

Company secretary Mr. Tung Tat Chiu, Michael

Authorised Mr. Wang Jinlong (王金龍) representatives Flat A, 4th Floor Tak On Mansions 5 Pine Street, Tai Kok Tsui Kowloon, Hong Kong

Mr. Tung Tat Chiu, Michael (佟達釗) Office 1601, 16th Floor LHT Tower, 31 Queen’s Road Central, Hong Kong

Auditor PricewaterhouseCoopers Certified Public Accountants 22/F Prince’s Building Central, Hong Kong

Branch share registrar Computershare Hong Kong Investor Services Limited and transfer office in Shops 1712-1716, 17th Floor, Hopewell Centre Hong Kong 183 Queen’s Road East Wanchai Hong Kong

Principal share registrar Codan Trust Company (B.V.I.) Ltd. and transfer office in Commerce House, Wickhams Cay 1 the British Virgin P.O. Box 3140 Islands Road Town, Tortola British Virgin Islands VG1110

– III-19 – APPENDIX III GENERAL INFORMATION

Principal bankers Standard Chartered Bank (China) Limited 11/F Tower A, Kingkey 100 Building No. 5016 Shennan East Road Luohu District Shenzhen 518001 China

China Merchants Bank China Merchants Building, Shekou Shenzhen 518067 China

Hang Seng Bank Limited 83 Des Voeux Road Central Hong Kong

China Construction Bank Corporation Rongchao Business Center 6006 Yitian Road, Futian District Shenzhen PRC

Industrial and Commercial Bank of China Limited Clearing Centre the Second Floor North Block Financial Center Shennan Road East Shenzhen PRC

12. PARTIES INVOLVED IN THE RIGHTS ISSUE

Underwriters Great Wisdom Investment Limited Flat A, 8th Floor, Waylee Industrial Centre 30-38 Tsuen King Circuit, Tsuen Wan New Territories, Hong Kong

Greenwoods China Alpha Master Fund 190 Elgin Avenue, George Town Grand Cayman, KY1-9005 Cayman Islands

– III-20 – APPENDIX III GENERAL INFORMATION

China Galaxy International Securities (Hong Kong) Co., Limited Units 3501-7 & 3513-14, 35/F Cosco Tower, 183 Queen’s Road Central Hong Kong

Legal advisers to As to Hong Kong law the Company Tung & Co. in association with Jia Yuan Law Office Office 1601, 16th Floor, LHT Tower 31 Queen’s Road Central Hong Kong

As to BVI law Conyers Dill & Pearman 29/F One Exchange Square 8 Connaught Place Central Hong Kong

Reporting accountant PricewaterhouseCoopers Certified Public Accountants 22/F Prince’s Building Central Hong Kong

13. MATERIAL CONTRACTS

As at the Latest Practicable Date, the following contracts (not being contracts in the ordinary course of business of the Company) have been entered into by members of the Group within two years immediately preceding the date of this Prospectus which are or may be material:

(a) the underwriting agreement dated 24 December 2014 entered into among the Company, China Galaxy International Securities (Hong Kong) Co., Limited and Jereh International (Hong Kong) Co., Limited in relation to the rights issue of 154,341,411 rights shares in the Company;

(b) the irrevocable undertakings dated 24 December 2014 given by each of King Shine Group Limited, Termbray Natural Resources Company Limited, Jade Win Investment Limited, CSOF Inno Investments Limited, Everbright Inno Investments Limited, Jereh International (Hong Kong) Co., Limited and Ko Po Ming;

(c) the placing agreement dated 12 March 2015 entered into between the Company and China Galaxy International Securities (Hong Kong) Co., Limited in relation to the placing of the convertible bonds with an aggregate principal amount of up to HK$250,000,000 to be issued by the Company;

– III-21 – APPENDIX III GENERAL INFORMATION

(d) the memoranda of understanding all dated 9 June 2015 entered into among 深圳市百勤石油技術有限公司 (Petro-king Oilfield Technology Limited*), He Jianhui, Chen Hongli, Zhang Yianwu and 深圳市弗賽特檢測設備有限公司 (Shenzhen Fluid Science & Technology Co., Ltd*) with each of 上海景林資產管理有限公司, He Jianhui and Chen Liquan in relation to the proposed disposal of an aggregate of 40.1% equity interest in 深圳市弗賽特檢測設備有限公司 (Shenzhen Fluid Science & Technology Co., Ltd*);

(e) the placing agreement dated 31 July 2015 entered into between the Company and Convoy Investment Services Limited in relation to the placing of bonds with an aggregate principal amount of up to HK$180,000,000 to be issued by the Company;

(f) the disposal agreements all dated 3 August 2015 entered into among 深圳市百勤石油技術有限公司 (Petro-king Oilfield Technology Limited*) with each of 長安財富資產管理有限公司, He Jianhui and Chen Liquan in relation to the disposal of an aggregate of 40.1% equity interest in 深圳市弗賽特檢測設備有限公司 (Shenzhen Fluid Science & Technology Co., Ltd*);

(g) the subscription agreement dated 24 September 2015 entered into between the Company and Termbray Natural Resources Company Limited in respect of 28,480,000 new shares issued by the Company;

(h) the subscription agreement dated 24 September 2015 entered into between the Company and Jade Win Investment Limited in respect of 20,000,000 new shares issued by the Company;

(i) the subscription agreement dated 24 September 2015 entered into between the Company and Jereh International (Hong Kong) Co., Limited in respect of 45,000,000 new shares issued by the Company;

(j) the supplemental agreement dated 24 November 2015 to the subscription agreement dated 24 September 2015 in respect of 28,480,000 new shares issued by the Company entered into between the Company and Termbray Natural Resources Company Limited;

(k) the supplemental agreement dated 24 November 2015 to the subscription agreement dated 24 September 2015 in respect of 20,000,000 new shares issued by the Company entered into between the Company and Jade Win Investment Limited;

(l) the supplemental agreement dated 24 November 2015 to the subscription agreement dated 24 September 2015 in respect of 45,000,000 new shares issued by the Company entered into between the Company and Jereh International (Hong Kong) Co., Limited;

(m) the Underwriting Agreements; and

(n) the Irrevocable Undertakings.

– III-22 – APPENDIX III GENERAL INFORMATION

14. LITIGATION

Save as disclosed below, as at the Latest Practicable Date, no member of the Group is engaged in any litigation or claims of material importance known to the Directors to be pending or threatened against any member of the Group.

During 2014, a contracting party initiated legal proceedings against the Group alleging a failure to provide stipulated amount of drilling works under the contracts entered in 2012 and 2013 and claimed for a total amount of RMB24,164,142. The case was concluded on 1 June 2015 in which the judgment of the court has been in favor of the Group and has dismissed the claim of the contracting party. The contracting party is in the process of appeal. As at the Latest Practicable Date, restricted deposits of RMB5,000,000 are held at bank as reserve under litigation claim.

15. EXPENSES

The expenses in connection with the Rights Issue and the application for listing, including underwriting commission, printing, registration, translation, legal and accounting charges are estimated to amount to approximately HK$3 million and will be payable by the Company.

16. DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES

A copy of this Prospectus, together with copies of the PAL and EAF and the written consent referred to in the paragraph headed “Qualification and Consent of Expert” in this appendix have been delivered to the Registrar of Companies of Hong Kong for registration as required by section 342C of the Companies (WUMP) Ordinance.

17. LEGAL EFFECT

The Issue Documents and all acceptances of any offer or application contained in such documents are governed by and shall be construed in accordance with the laws of Hong Kong. Where an application is made in pursuance of any such documents, the relevant document(s) shall have the effect of rendering all persons concerned bound by the provisions, other than the penal provisions, of sections 44A and 44B of the Companies (WUMP) Ordinance, so far as applicable.

– III-23 – APPENDIX III GENERAL INFORMATION

18. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection at the principal place of business of the Company at Room 504, 5/F, Tower 1 Silvercord, 30 Canton Road, Tsim Sha Tsui, Kowloon, Hong Kong during normal business hours (i.e. from 9:00 a.m. to 12:00 noon. and from 1:00 p.m. to 6:00 p.m.) unless (i) a tropical cyclone warning signal number 8 or above is hoisted, or (ii) a black rainstorm warning signal is issued, except public holidays, from the date of this Prospectus up to and including Friday, 29 June 2016:

(a) the memorandum and articles of association of the Company;

(b) the annual reports of the Company for the two years ended 31 December 2015, respectively;

(c) the report on the unaudited pro forma financial information of the Group issued by PricewaterhouseCoopers set out in Appendix II to this prospectus;

(d) the written consent referred to in the paragraphs headed “Qualifications and Consents of Experts” in this appendix;

(e) the material contracts of the Company listed in the paragraph headed “Material Contracts” in this appendix;

(f) this Prospectus.

19. MISCELLANEOUS

(a) The registered office of the Company is Commerce House, Wickhams Cay 1 P.O. Box 3140, Road Town, Tortola, British Virgin Islands, VG1110 and the principal place of business of the Company is Office No. 504, 5th Floor, Tower 1, Silvercord, No. 30 Canton Road, Kowloon, Hong Kong.

(b) The Share Registrar is Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong.

– III-24 –