The company's stock price reached its minimum intraday limit in three consecutive trading sessions on 13, 14 and 15 Oct 2008, thus constituting an unusual price movement.

To date, the company's controlling shareholder New Hope Chemical Investment Co., Ltd. and its effective controller Liu Yonghao both confirm that there are no significant undisclosed issues outstanding.

Following consultation, the company will cancel the transaction, which was disclosed on 18 Sept 2008, to purchase assets via private placement. In compliance with relevant regulations, no private placement will be launched within the next three months.

The board of directors confirms that, apart from the above-mentioned issue, there are neither significant undisclosed issues, negotiations, plans, intents or agreements outstanding, pursuant to relevant regulations, nor is there any remaining undisclosed information that would materially impact the company's stock price within the next two weeks.

The China Securities Journal, the Shanghai Securities News and the website of the Shanghai Stock Exchange (www.sse.com.cn) are the company's designated media for information disclosure. Investors are advised to exercise caution when dealing in the company's shares.

Board of Directors
16 Oct 2008

Source: Shanghai Stock Exchange

Date: 16 Oct 2008

CN01/CJ/JL/JE/KM