Its operating permit allows the Company to distribute natural gas throughout the greater Sanya region of Hainan Island for 30 years commencing December 31, 2007.

This part caught my eye. Hainan Island (pop 7.1 M) is a popular tourist destination which the Chinese Govt. is trying to develop as a major international conference center and holiday destination. I've no idea how far along they are in their plans, but it's probably worth looking into in connection with this company, especially since Sanya is the main beach resort area. Any growth in the Sanya area implies increased NG consumption for air-con, as well as transportation and cooking. Also worth noting are the ecological programs they're promoting in the interior.

Here's the travel guide blurb on the place:

http://www.travelchinaguide.com/cityguides/hainan

and here's an extract from the wiki entry:

Economy

Hainan's economy is predominantly agricultural, and more than a half of the island's exports are agricultural products. Hainan's elevation to province-level status (1988), however, was accompanied by its designation as China's largest "special economic zone", the intent being to hasten the development of the island's plentiful resources.

Prior to this, the province had a reputation for being a "Wild West" area, largely untouched by industrialisation; even today there are relatively few factories in the province. Tourismplays an important part of Hainan's economy, thanks largely to its tropical beaches and lush forests.

The central government has encouraged foreign investment in Hainan and has allowed the island to rely to a large extent on market forces.

Hainan's industrial development largely has been limited to the processing of its mineral and agricultural products, particularly rubber and iron ore. Since the 1950s, machinery, farm equipment, and textiles have been manufactured in the Haikou area for local consumption. A major constraint on industrial expansion has been an inadequate supply of electricity. Much of the island's generating capacity is hydroelectric, and it is subject to seasonal fluctuations in stream and river flows.

Its nominal GDP for 2008 was 145.9 billion yuan (US$21 billion), making it the 4th smallest in all of the PRC and contributes just 0.5% to the entire country's economy. Its GDP per capita was 17,175 yuan (US$2,472).

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the standout point in this article is the electrical shortage, which implies increased NG consumption somewhere down the road, since the place is too small to justify a nuclear plant. Important to note is that Hainan has a major naval base, so presumably future port facilities are possible for LNG off-loading, an angle worth looking at if Changfeng has enough clout to get a piece of it.

This is something for China fans to keep on their long-range radar. I don't think the place is going to boom overnight, but it has definite possibilities, in fact a while back I looked into Hainan as a possible retirement destination. It passed on all criteria, but you'd want to look into their property system before buying since it differs from our own. Here's info on that, current to 2003:

http://www.cadastraltemplate.org/countryreport/China.pdf

ebear