Financial Highlights (Year ended 31 December):

　(Hong Kong, 27 March 2011) China BlueChemical Ltd. (“China BlueChem” or the “Company”; stock code: 3983), one of the leading chemical fertiliser producer in China, today announced its audited annual results for the year ended 31 December 2010.

　During the year, benefiting from the PRC government’s supportive policies to agriculture industry and sustainable Chinese economic growth, the Company’s revenue registered a solid growth of 18.51% to RMB6,867.25 million. Gross profit rose 27.30% to RMB2188.74 million. Net profit attributable to owners of the parent climbed 19.35% to RMB1,175.29 million. Basic earnings per share were RMB0.25. The Board recommend a final dividend of RMB0.09 per share for the year ended 31 December 2010 (2009: RMB0.07).

　Mr. Yang Yexin, CEO and President of the Company, said, “During the year under review, the PRC government bolstered efforts in implementing energy-saving and emission-reduction, while adjusting the benchmark price of domestic-landed natural gas. The residential usage of natural gas increased significantly which affected the utilization rate of domestic gas based urea and methanol producer. An increase in coal price drove up the cost of coal-based urea and methanol producer. Leveraging on China BlueChemical’s low cost advantage along with its upstream and downstream integration marketing strategy, the Company was able to achieve steady revenue growth delivered good shareholders’ return. The Company also took advantage of opportunities for quality acquisitions by obtaining 80% equity interest of Hegang Huahe Coal Chemical Ltd. and 21% equity interest of Guangxi Fudao Agricultural Means of Production Limited. With the added coal resources acquired, the Company further enhanced its efforts in construction of an upstream and downstream integrated coal and urea production base, aiming to further expanding the urea production capacity while capturing a larger market share.”

　During the year under review, the Group was able to eradicate inherent production problems by adopting quantified production management. Production volume of urea achieved 2,010,336 tonnes, while exceeding 2 million tonnes for the first time, and the average utilisation rate recorded 109.3%. The Fudao Phases I & II urea plants fulfilled non-stop long operation cycles. Having overcome the effects of slack in domestic demands for fertilisers due to factors like natural disasters and adverse climate, in the first half of 2010 through centralized sales management in 2010. The annual urea sales volume achieved 1,984,044 tonnes while revenue rose 5.9% to RMB3,514.8 million by exploiting the favorable opportunities of low-season export windows of fertiliser,

　In 2010, the increase of international energy price and tight supply led to a price surge in methanol. Continual promotion of alternative energy in the PRC fueled the demands for methanol. The Company grasped the growing momentum of the industry and safety management, while achieving a historical record of continuous operation cycle of production of 290 days in the Hainan Phase I(CNOOC Jiantao). The construction of an additional 800,000 tonnes of methanol capacity was completed in the 4th quarter of 2010. Production and sales volume of methanol were 867,081 tonnes and 866,859 tonnes, representing an increase of 7.12% and 8.14% respectively. Driven by the rising price and demand, the sales of methanol soared 38.5% to RMB1,690.9 million.

　During the year, the global inventory of phosphate fertiliser remained low and the demand in the second half of the year was strong, thus driving the increase in sales price. The phosphate fertilizser production volume in Hubei recorded a historical high of 455,207 tonnes. The Company grasped the high phosphate price market window presented in the second half of the year and strengthen sales volume, the sales volume and revenue achieved 479,556 tonnes and RMB1,234.1 million, representing a surge of 24.5% compared to 2009.

　Besides, the Company fully utilised its strong cash position to take advantage of quality merger and acquisition opportunities while scaling up new project construction. The Company has pushed forward the construction of Hubei Dayukou 500,000 tonnes phosphate fertiliser expansion project and expected to complete the construction at the end of 2011, which is on schedule. The recently acquired Hegang Huahe Coal Chemical Ltd. actively pushed forward the project construction and expansion of the urea production capacity, while ensuring the supply of the upstream raw materials with its coal exploration right to achieve sustainable development of the Company.   

　Mr Yang concluded: "Looking ahead, the agriculture-friendly policy of the PRC government as well as the increase in grain prices which aim to ensure the supply of grain in China will enhance the initiative of the farmers while sparking a steady rise in the demand of fertiliser. The PRC economy’s sustained growth and the rise in demands for methanol from domestic downstream industries as an alternative source of energy creates a favourable market environment of methanol. China BlueChemical intends to take advantage by pushing forward its project construction, integrating a resources network while evaluating quality merger and acquisition opportunities to implement its expansion strategy of upstream and downstream resources integrated production plant. We strive to make use of our low cost structure and strong capital position to tap potentially abundant market opportunities while expanding our market share in our product and maximise shareholders’ return.”

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About China BlueChemical Ltd.
China BlueChem is one of the largest urea and methanol producers in China in terms of production volume. It is a listed company under China National Offshore Oil Corp. that engages in the production of downstream mineral fertilisers and synthetic chemical products. Currently, China BlueChem’s production facilities are located in Hainan, Inner Mongolia and Hubei, PRC, with a total designed annual production capacity of 1,840,000 tonnes of urea, 1,600,000 tonnes of methanol and 500,000 tonnes of phosphate fertiliser (DAP/MAP).

For press enquiries：
China BlueChemical Ltd.
Mr. Quan Changsheng Tel: (852) 2213 2500    quanchsh@cnooc.com.cn

Strategic Financial Relations (China) Limited
Ms. Nan Dong   Tel: (852) 2864 4811 / 9733 6558   nan.dong@sprg.com.hk
Ms. Arlene Wong  Tel: (852) 2864 4899 / 9233 2926   arlene.wong@sprg.com.hk
Ms. Sophie Zhang  Tel: (852) 2114 4962 / 9660 2952  sophie.zhang@sprg.com.hk
Ms. Ada Ho     Tel: (852) 2114 4954 / 9240 8639  ada.ho@sprg.com.hk