BEIJING YANHUA<0325> - Announcement
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contents of this announcement, makes no representation as to its accuracy
or completeness and expressly disclaims any liability whatsoever for any
loss howsoever arising from or in reliance upon the whole or any part of
the contents of this announcement.
BEIJING YANHUA PETROCHEMICAL COMPANY LIMITED
(a joint stock company incorporated in the People's Republic of China with
limited liability)
Announcement
The board of directors (the "Board") of Beijing Yanhua Petrochemical
Company Limited (the "Company") wishes to announce that the Company's
proposed ethylene expansion project (which includes the ethylene facility,
the LDPE facility, the acetonitrile extraction facility and benzene
production facility) (the "Ethylene Project") has been approved by the
State Council of the People's Republic of China ("PRC").
The Board wishes to announce that the State Council of the PRC has
approved on 18th March, 1999 the Company's Ethylene Project which was
described in the prospectus (the "Prospectus") issued by the Company in
relation to its global offering of H shares in June 1997. The approval
granted by the State Council is the final major approval required before
the Company can proceed further with plans to implement the Ethylene
Project. According to the feasibility study done in early March 1999, the
total construction costs for the Ethylene Project, including interest
expenses, are expected to be Renminbi 3.84 billion (This amount is lower
than the amount stated in the Prospectus because of (i) the reduction in
the prices of certain construction materials, and (ii) certain cost
containment measures taken by the Company), which will be partially funded
by cash generated from the Company's operation and partially funded by
loans from banks. In a related event, on 2nd April, 1999 the Company will
hold a contract signing ceremony with various international companies that
will provide technology and equipment as part of the Ethylene Project.
The Ethylene Project is an integral part of the Company's production
capacity expansion plans. With the completion of the Ethylene Project,
which is expected to be in the second half of 2001, the annual rated
ethylene production capacity of the Company will be increased from 450,000
tonnes to 660,000 tonnes.
This announcement is made by the order of the Board, the members of which
individually and jointly accept responsibility for the accuracy of it.
By the order of the Board
Zhang Zhaomin
Company Secretary
Beijing, the PRC, 1st April, 1999
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