09:25     SINO PROSPER<00766> - Announcement (2)                              

    immediately and comply with the Listing Rules accordingly.                
                                                                              
    Pursuant to the Joint Venture Agreement, SPGL and the Joint Venture       
    Partner will contribute 15% of their respective registered capital in     
    the Joint Venture Company in cash within 90 days after the issuance of    
    the Joint Venture Company's business license. The remaining respective    
    registered capital of the Joint Venture Company to be contributed by      
    SPGL and the Joint Venture Partner is payable within two years after the  
    issuance of the Joint Venture Company's business license. The terms of    
    the Joint Venture Agreement have been arrived at after arm's length       
    negotiations between SPGL and the Joint Venture Partner and the           
    Directors believe that the terms of the Joint Venture Agreement are fair  
    and reasonable and in the interests of the shareholders of the Company    
    as a whole.                                                               
                                                                              
    Profit sharing                                                            
    SPGL and the Joint Venture Partner will share all the profit, loss,       
    costs and risk in proportion to their respective interest in the          
    registered capital of the Joint Venture Company. The future results of    
    the Joint Venture Company will be consolidated into the Group's           
    accounts.                                                                 
                                                                              
    Composition of board of directors of the Joint Venture Company            
    The board of directors of the Joint Venture Company will comprise four    
    directors, of which three will be appointed by SPGL and one will be       
    appointed by the Joint Venture Partner.                                   
                                                                              
    Responsibilities of the Joint Venture Partner and the Group               
    The Joint Venture Partner is responsible for, amongst other things, the   
    followings:                                                               
                                                                              
    (i)        to assist in applying for the relevant approvals,              
    registrations and licenses from the relevant PRC government authorities   
    for the establishment of the Joint Venture Company;                       
                                                                              
    (ii)        to assist in purchasing or renting the equipment, material,   
    raw materials, transportation facilities and communication facilities     
    for the Joint Venture Company;                                            
                                                                              
    (iii)        to assist in employing management, technicians, workers and  
    other staff for the Joint Venture Company in the PRC; and                 
                                                                              
    (iv)        to assist in obtaining the necessary visa and working permit  
    for overseas staff of the Joint Venture Company.                          
                                                                              
    Pursuant to the Joint Venture Agreement, SPGL is responsible for,         
    amongst other things, the followings:                                     
                                                                              
    (i)        to assist in purchasing equipment and materials from           
    overseas;                                                                 
                                                                              
    (ii)        to provide the necessary technicians for the production,      
    inspection, installation and testing of facilities;                       
                                                                              
    (iii)        to provide training to the technicians and workers of the    
    Joint Venture Company; and                                                
                                                                              
    (iv)        other matters entrusted by the Joint Venture Company.         
                                                                              
    REASON FOR FORMATION OF THE JOINT VENTURE COMPANY                         
    The Group is principally engaged in property development and management   
    in the PRC and investment in coal gas production and power generation in  
    the northern PRC. It has been reviewing various opportunities with an     
    aim to diversify the variety of its business. The Directors have          
    conducted preliminary researches and have collected information sourced   
    from various articles published in the PRC and overseas countries and     
    are of the view that the consumption of LNG and LPG will become one of    
    the most important energy sources in the 21st century. Developed          
    countries in North America and the European Union are starting to         
    replace pollutive and low-efficient source of energy by less pollutive    
    and high-efficient LNG and LPG. Based on the information possessed by     
    the Group, the Directors are of the view that development of LNG and LPG  
    in the PRC is not sufficient to feed the boom in the PRC economy and the  
    consumption of natural gas including LNG and LPG in the PRC will keep on  
    its increasing trend in the coming future.                                
                                                                              
    The Joint Venture Partner is principally engaged in importing petroleum   
    products including LPG and sales of petroleum product in the PRC.         
    Restructured and renamed in 1999 with registered capital of RMB5          
    million, the Joint Venture Partner has possessed 6 years of experience    
    in the sales of the petroleum products in the PRC. The Directors are of   
    the view that the past experience of the Joint Venture Partner in the     
    area of energy-related business in the PRC will enhance the development   
    of the Joint Venture Company. In anticipation of the enormous demand and  
    growth potential of natural gas including LNG and LPG in the PRC market