| King Stone Energy Group Limited (“King Stone Energy” or the “Company”, Stock Code: 663.HK) stepped into the coal industry after the completion of its acquisition of Hengtai Coal Co. Ltd, in Erduosi, Inner Mongolia on 21 December 2009. At present, the Company owns coal mines in Eerduosi, Inner Mongolia, China. The mine completed its test period in November 2009 and commenced its production in 2010. The production of coal mines in Inner Mongolia reached 4 million tonnes in 2010 and it is expected to be gradually increased in the long run. The annual production capacity of the mines in Inner Mongolia to be reached 6.60 million tones.
The mines of the Company are relatively more accessible by transport with their prime geographical locations. After simple screening, raw coals generated by the mines are supplied to several power stations in Inner Mongolia, Shanxi and Hebei. These mines have also established long-term strategic cooperation relations with some large coal logistics enterprises such as Qinhuangdao Mingwei Group （秦皇島銘偉集團）, securing the sales in raw coals markets. The management believes that the mines construction projects of the Company will be followed by a promising development prospect and will see an enormous potential for further expansion of coal resources reserves and production capacity.
King Stone Energy possesses high quality projects, experienced management with strong corporate governance level, as well as comprehensive future expansion plans. Under the trend of integrating global resources and globalizing market competition, the Company insisted on technology innovation, reliable operations, raising the efficiencies of coal mining, improving the safe production conditions of coal and protecting the ecological environment, so as to maintain a sustainable development route for the Company.
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