The Hong Kong and China Gas Company Limited (Stock Code: 3) annual report EXPANDING NEW HORIZONS Building on a distinguished history as a local energy supplier in Hong Kong spanning more than a century and a half, we have in recent years consistently embraced new opportunities and challenges as the scope of our operations has progressively expanded. 2014 AWARDS AND RECOGNITIONS TOWNGAS TOWNGAS CHINA Global Chinese Business 1000 Company of the Year Award Yazhou Zhoukan Institution of Gas Engineers & Managers of the United Kingdom and the Energy and Top 100 Hong Kong Listed Companies Utilities Alliance Finet Group Limited and Tencent TOWNGAS & TOWNGAS CHINA The Outstanding Listed Company Award Constituent Companies of The Hong Kong Institute of Financial Analysts the Hang Seng Corporate and Professional Commentators Limited Sustainability Index Series Hang Seng Indexes Company Limited Innovation continued to drive CONTENTS our business in 2014 with the establishment of S-TEch, 02 Towngas’ Businesses In 2014 a new IT services venture 04 Business Highlights focused on the application of 05 Five-Year Summary We have developed a cloud computing. 06 Chairman’s Statement landmark 202 PROJEctS 14 Board of Directors IN MAINLAND CHINA, 15 Biographical Details of Directors Our NEW PLANT IN 19 Executive Committee spanning city-gas, city-water, INNER MONGOLIA was 20 The Mainland Utility Businesses wastewater treatment, natural undergoing commissioning 28 The Hong Kong Gas Business gas pipelines, new energy, to upgrade methanol 36 New Energy and telecommunications and into high-grade fuel Diversified Businesses the production of gas-related chemical products. 44 Corporate Social Responsibility materials and devices. 53 Financial Resources Review 54 Five-Year Financial Statistics Agreement for the In Hong Kong we hosted the 55 2014 Financial Analysis implementation of the 13th GAS INFORMATION 56 Comparison of Ten-Year Results SOUth EAST NEW EXchANGE IN thE WESTERN 58 Report of the Directors TERRITORIES LANDFIll PACIFIC AREA CONFERENCE 67 Corporate Governance Report GAS UTILISATION PROJEct AND EXHIBITION for 77 Independent Auditor’s Report was signed, helping the landfill international gas operators. 78 Consolidated Income Statement site to significantly reduce 79 Consolidated Statement of carbon dioxide emissions. Comprehensive Income Marking its 10th year of 80 Consolidated Balance Sheet operations, our subsidiary 82 Balance Sheet Towngas Telecom opened a 84 Consolidated Cash Flow Statement large scale DATA CENTRE 86 Consolidated Statement of Changes in Equity IN HONG KONG, the second 88 Notes to the Accounts such facility in its portfolio. 173 Corporate Information and Financial Calendar TOWNGAS’ BUSINESSES IN 2014 Towngas (Stock Code: 3) Towngas China (Stock Code: 1083) 172 202 Heilongjiang Piped City-gas Water Projects Coal Logistic Project Piped City-gas 158. Shenyang Coastal 91 Economic Zone Projects 41. Wujiang 82. Shandong Jining Projects 159. Yingkou Guangdong Province 42. Suzhou Industrial Park Jiaxianggang Guangdong Province 160. Dalian 1. Panyu 43. Wuhu Logistic Port 107. Foshan Changxingdao 2. Zhongshan 44. Suzhou Industrial Park Oilfield Project 108. Shaoguan 37 161. Dalian Economic Jilin 29 3. Dongyong (Industrial Wastewater 83. Phetchabun Province 109. Qingyuan 77 and Technical 171 170 169 4. Shenzhen Treatment) in Thailand 110. Yangdong Development Zone 5. Chaoan 45. Maanshan 111. Fengxi 162. Anshan 6. Chaozhou Raoping 46. Jiangbei Telecommunication 156 Eastern China 163. Lvshun Projects 167 Liaoning Central China 112. Nanjing Gaochun 164. Kazuo 165 158 96 7. Wuhan New Energy 84. Shandong Jinan 113. Dafeng 165. Beipiao 157 168 154 8. Xinmi Projects 85. Shandong Jinan Chibo 114. Tongshan 166. Wafangdian 155 162 164 159 Eastern China Coal Mining 86. Liaoning Dalian DETA 115. Maanshan 167. Xinqiu 36 87. Dalian Yida 116. Bowang Hebei 166201 9. Yixing 47. Jiangxi Fengcheng 168. Jianping 160 88. Shandong Laiyang 117. Zhengpugang 161 10. Taizhou 48. Inner Mongolia Erdos 169. Changchun 94Beijing 173 86 87 Xiaoyugou 89. Xuzhou Fengxian Xin Qu Modern 30 56 163 11. Zhangjiagang 170. Gongzhuling Inner Mongolia 95 12. Wujiang 49. Inner Mongolia Erdos 90. Xuzhou Peixian Industrial Zone 171. Siping 72 13. Xuzhou Kejian 91. Harbin 118. Wuhu Fanchang 172. Qiqihar 178 49 55 175 14. Suining 92. Dongguan 119. Bozhou-Wuhu 174 140 143 Coal-based Chemical Hebei Province 48 51 176 148 15. Fengxian 93. Shenzhen Modern Industrial Shanxi 31 152 50. Jiangxi Fengcheng 173. Qinhuangdao 70 151 147 88 94. Beijing Zhongjing Zone 73 142 16. Danyang 51. Inner Mongolia Erdos 174. Yanshan 177 136 95. Beijing Chibo 120. Anqing 74 57 138139 146 17. Jintan 175. Cangxian 145 14128 137 CNG/LNG Refilling 121. Chizhou 81 84 85 18. Tongling 176. Mengcun Stations 122. Tunxi 63 149 150 Shandong Yellow Sea 19. Suzhou Other Projects 62 59 144 52. Shaanxi Xianyang 177. Shijiazhuang 80 58 Industrial Park 123. Huangshan 76 61 53. Shaanxi Huitai 96. Shenyang Sanquan Inner Mongolia 66 69 82 68 20. Changzhou 124. Huizhou 15 90 Construction 67 65 79 Jiangsu 54. Anhui Maanshan 125. Tongxiang 178. Baotou 89 21. Nanjing Supervisory 114 13 14 55. Shanxi Yuanping 126. Huzhou Shaanxi 8 113 22. Fengcheng Southwestern China 38 119 56. Dalian DETA 97. M-Tech 53 60 10 23. Pingxiang 127. Yuhang 179. Ziyang 75 52 32 26 98. GH-Fusion 106 35 Anhui 57. Shandong Chiping 128. Songyang 180. Weiyuan Henan 40 16 104 24. Jiangxi 99. Towngas Technology 21 58. Shandong Jining 129. Changjiu 181. Pengxi 203 17 20 11 25. Zhangshu 100. Suzhou Industrial 71 39 42 59. Shandong Dongping 54 115 112 9 100 19 26. Yonganzhou 130. Fuzhou 182. Lezhi 44 12 60. Henan Xinmi Park Broad Energy 45 116 102 41 131. Jiujiang 183. Pingchang 186 46 43 126 27. Hangzhou Services 183 117 125 61. Shandong Jiaxiang 132. Wuning 184. Dayi 191 118 Shandong Province 62. Henan Anyang 101. G-Tech 194 Hubei 120 121 18 133. Xiushui 185. Yuechi Sichuan 188 127 28. Jinan East 63. Shanxi Lingshi 102. GH Yixing Ecology 193 181 123 134. Yifeng 186. Cangxi 185 7 124 27 103. S-Tech (Zhuhai) 187 Chongqing 131 Northern China 64. Guangdong 189 182 135. Changting 187. Chengdu 184 192 122 29. Jilin Guangzhou 104. Zhangjiagang 132 Shandong Province 188. Zhongjiang 190 179 129 Zhejiang (Chemical) 196 78 133 30. Beijing Economic- 65. Henan Kaifeng 195 136. Jimo 189. Jianyang 180 134 128 66. Henan Linzhou 105. ECO Engineering 153 24 22 47 130 East China Sea technological 137. Laoshan 190. Pengshan 67. Shanxi Pinglu Management 25 50 Development Area 138. Zibo 191. Mianyang 68. Shandong Weishan (Shenzhen) Hunan 31. Hebei Jingxian 139. Zibo Lubo 192. Xinjin 23 69. Shandong Shanxian 106. ECO Engineering Northwestern China 140. Longkou 193. Xindu 70. Hebei Shijiazhuang Management (Xi’an) Jiangxi Fujian 32. Xi’an 141. Jinan West 194. Mianzhu Guizhou 135 71. Shaanxi Lueyang 142. Weifang 195. Jiajiang Hainan Province 72. Inner Mongolia 143. Weihai 196. Qijiang 33. Qionghai Huhhot 197 108 144. Taian 197. Guilin 73. Shandong Linqing 200 199 Guangdong 198. Zhongwei (Fusui) 5 145. Chiping Thailand 109 64 105 Midstream 74. Xingtai Ningjin 199. Xingyi Yunnan Guangxi 101 111 6 146. Linqu 1 3 97 Projects 75. Shaanxi Fengxiang 83 Phetchabun 107 98 147. Laiyang 200. Luliang 92 99 34. Guangdong LNG Upstream Projects 198 4 148. Zhaoyuan 2 93 34 35. Anhui NG 76. Shanxi LCBM 149. Pingyin Midstream Project 36. Hebei NG 77. Jilin Tianyuan 103 150. Feicheng 201. Wafangdian NG 110 37. Jilin NG 78. LCMM Project 151. Boxing Economic Hong Kong 38. Henan NG 79. Xuzhou COG Development Zone CNG Refilling Station 39. Jintan NG 80. Heze COG 152. Yangxin 81. Jiexiu COG 202. Qiqihar Hunan Province LNG Refilling 153. Miluo 33 Station Other Project Northeastern China Hainan 40 Nanjing (Marine) 154. Benxi 203. Zhuojia Public 155. Chaoyang Engineering 156. Tieling Towngas Group Hong Kong headquarters CNG / LNG refilling stations (Towngas) Liquefied natural gas receiving station Coal-based chemical processing 157. Fuxin Piped city-gas projects (Towngas) CNG refilling station (Towngas China) Provincial natural gas pipeline network Upstream projects Piped city-gas projects (Towngas China) Other projects (Towngas) Water projects Coal logistic project City high pressure pipeline network / Other projects (Towngas China) Telecommunication projects Oilfield project Underground gas storage (Towngas) Coal mining City high pressure pipeline network (Towngas China) 172 202 Heilongjiang Based in Hong Kong, our portfolio 91 currently includes 202 projects in 24 provinces, municipalities and autonomous regions in 37 Jilin 29 77 171 170 169 mainland China, as well as one in Thailand. 156 167 Liaoning 165 157 158 96 154 168 155 162 164 159 36 Hebei 166201 160 161 94Beijing 173 86 87 30 56 163 Inner Mongolia 95 72 178 49 55 175 174 140 143 48 51 176 148 Shanxi 31 152 70 151 147 88 73 142 177 136 74 57 138139 146 145 14128 137 81 84 85 63 149 150 Shandong Yellow Sea 62 59 144 80 58 76 61 66 69 82 68 15 90 67 65 79 Jiangsu 89 114 13 Shaanxi 8 14 113 38 119 53 60 10 75 52 32 26 106 35 Henan Anhui 40 16 104 21 203 17 20 11 71 39 42 54 115 112 9 100 19 44 12 45 116 102 41 186 46 43 126 183 117 125 191 118 194 Hubei 120 121 18 188 Sichuan 193 181 123 127 185 7 124 27 187 Chongqing 131 189 182 184 192 122 132 190 179 129 Zhejiang 196 78 133 195 180 134 128 153 24 22 47 130 East China Sea 25 50 Hunan 23 Jiangxi Guizhou 135 Fujian 197 108 200 199 Guangdong 5 Thailand 109 64 105 Yunnan Guangxi 101 111 6 1 3 97 83 Phetchabun 107 98 92 99 198 4 2 93 34 103 110 Hong Kong 33 Hainan Towngas Group Hong Kong headquarters