RMB 58 Mln Loan Guarantee

At the 8th 2008 Extraordinary Meeting of the 3rd Board of Directors, held on 23 Oct 2008, the following proposals were examined and approved:

1. to guarantee an eight-year RMB 57.89 mln loan with Bank of China, Dongying Dongcheng sub-branch for Dongying Capital Water Co., Ltd., a subsidiary in which the company holds a 50% stake
China Water Investment Co., Ltd. will pledge a 50% stake in Dongying Capital Water to the company as a counter guarantee.
As of the date of this announcement, the total amount of guarantees provided by the company and its subsidiaries is RMB 1,584,890,000; the total amount of guarantees provided by the company for its subsidiaries is RMB 560,890,000.

2. to pledge the toll collection right to Jingtong Expressway for a 5-year RMB 900 mln loan, with an interest rate 7% lower than the benchmark interest rate
3. to provide a 6-month RMB 60 mln entrusted loan at an interest rate of 7.92% to Jiujiang Hewenhu Environmental Protection Co., Ltd. via China Minsheng Banking Co., Ltd.
4. to continue to apply for a one-year RMB 100 mln entrusted loan at an interest rate of 4.3434% from Jiujiang Hewenhu Environmental Protection Co., Ltd. via the Bank of Communication, Dongdan sub-branch
5. to apply for a renewal of a two-year RMB 300 mln line of credit with China Everbright Bank, Xinyuan branch
6. to apply for a renewal of a two-year RMB 449 mln line of credit with China Construction Bank, South Shouti Road sub-branch
7. the 3Q 2008 Report

The company will convene the 1st 2008 Extraordinary General Meeting of Shareholders on 11 Nov 2008, at which proposal 2 will be examined and considered for approval.

Board of Directors
23 Oct 2008


Source: Shanghai Stock Exchange

Date: 27 Oct 2008

CN01/SC/VW/DM/NK/KM