Ms. Ann Lin reports

CHANGFENG COMPLETES TRIAL RUN OF LNG SHIPMENT FROM CANADA TO THE PRC

Changfeng Energy Inc. has successfully completed its trial run of a liquefied natural gas (LNG) shipment from Canada to China using ISO containers. The LNG shipment from the Vancouver port was arranged by Changfeng and it arrived at the Shanghai port on Nov. 8, 2018, and has now cleared customs. The LNG exported to China was procured by Changfeng from a British Columbia-based energy provider. Sanya Changfeng Offshore Natural Gas Distribution Co. Ltd., a wholly owned subsidiary of Changfeng, is the importer into China. The LNG received in Shanghai will be sold to Hebei Riheng Clean Energy Ltd., a controlled subsidiary of Changfeng, and will be transported to Hebei to support the LNG distribution services of Riheng Energy to areas where pipeline gas is not accessible. Changfeng had obtained an export order from the Canadian National Energy Board for the LNG export and Sanya Changfeng had received all necessary permits for the LNG import in China.

According to the recent energy reform policies of the Chinese government, China is shifting away from a coal-based economy and is increasingly relying on natural gas as the source of energy consumption. In particular, Changfeng's management has observed that, in the winter months due to higher demand for natural gas required for heating in China, the available supply of natural gas may be lower and trucked LNG prices may increase. Based on Wood Mackenzie Ltd.'s estimates, trucks carried approximately 19 million tons of LNG to customers last year, accounting for 12 per cent of China's total LNG consumption. Further, unlike the market price of pipeline gas, which is regulated by the Chinese government, LNG prices are relatively deregulated and market oriented. Accordingly, the company has been seeking to broaden its supply base beyond that of China, to sources such as Canada, in order to benefit from opportunities in respect of LNG supply. As a Canadian-listed energy company operating in China, the company recognizes the potential synergy of Sino-Canadian energy trading and natural gas supply, and has taken steps, such as the aforementioned trial run LNG shipment, to strategically position the company to seize such opportunities.

About Changfeng Energy Inc.

Changfeng Energy is an integrated energy provider and natural gas distribution company (or natural gas utility) in China. Changfeng Energy strives to combine leading clean energy technology with natural gas usage to provide sustainable energy to its customer base in China.

We seek Safe Harbor.