The Hong Kong and China Gas Company Stock

The Hong Kong and China Gas Company Limited, together with its subsidiaries, principally engages in the production, distribution and marketing of gas, water supply and energy businesses in Hong Kong and the People’s Republic of China (the ‘PRC’).

The company also engages in property development and investment activities in Hong Kong. Inclusive of projects of the company’s subsidiary, Towngas China Company Limited (Towngas China), the company had 265 projects on the mainland, as of December 31, 2019, spread across 26 provinces, autonomous regions and municipalities. These projects encompass upstream, midstream and downstream natural gas sectors, environmentally-friendly energy and efficient energy applications, water sectors and waste processing, as well as telecommunications.

The company’s development of emerging environmentally-friendly energy businesses, through ECO Environmental Investments Limited (ECO), include coalbed methane liquefaction, clean coal chemicals, conversion and utilization of biomass, and utilization of industrial and agricultural waste, as well as natural gas refilling stations.

The company’s city-gas businesses on the mainland are progressing well. As of December 31, 2019, inclusive of Towngas China, the company had a total of 132 city-gas projects in mainland cities spread across 23 provinces, autonomous regions and municipalities. The total volume of gas sales for these projects in 2019 was approximately 25,550 million cubic metres. As of December 31, 2019, the company’s mainland gas customers stood at approximately 29.78 million.

The company’s aviation fuel facility, which is under a 40-year franchise agreement with the Airport Authority Hong Kong, supplies fuel for aircraft at Hong Kong International Airport in Chek Lap Kok. This business operates eight tanks with a gross aviation fuel storage capacity of 264,000 cubic metres, as well as a jetty with two berths for receiving fuel from Tuen Mun and delivering it to the Airport via two undersea pipelines. A major logistics base for aviation fuel in Hong Kong, it supplies approximately 6 million tonnes of fuel a year.

The company’s five dedicated filling stations serve around 18,000 liquefied petroleum gas (LPG) taxis and most of the LPG minibuses in Hong Kong, 24 hours a day. These stations typically sell around 65,000 tonnes of LPG a year. The company also manages landfill gas projects in Hong Kong, using gas collected from strategic landfills in the North East New Territories and South East New Territories.

Telecommunications

The company operates telecommunications businesses both in Hong Kong and mainland China through Towngas Telecommunications Company Limited, a wholly-owned subsidiary of the company, and its subsidiaries (collectively known as TGT). With its solid infrastructure and resources, TGT provides services to Hong Kong, mainland China and international telecommunications providers, operators, and enterprises.

Information Technology

The company’s wholly-owned subsidiary, S-Tech Technology Holdings Limited (S-Tech), provides its city-gas companies with information technology that supports customer service management. This business is engaged in cloud software development, solutions implementation and systems integration services that enable its city-gas businesses to manage their advanced customer service and gas piping network systems.

In 2019, S-Tech’s online customer service management platform, Towngas Customer Information System (TCIS), covered 85 per cent of the company’s city-gas companies on the mainland. During 2019, S-Tech cooperated with Shandong Jihua Gas Co., Ltd in Jinan, one of the company’s major city-gas joint ventures in Shandong Province, to introduce a new IT solution, Towngas Total Solution (TTS+). TTS+ is a comprehensive information system that seamlessly integrates Towngas’ financial, engineering and purchasing systems with S-Tech’s software, including TCIS 3.0, the Virtual Customer Centre (VCC) e-commerce platform, as well as the Towngas Management System and Geographic Information System.

Civil and Building Services Engineering

U-Tech Engineering Company Limited (U-Tech) is a wholly owned subsidiary of the company providing consultancy and engineering contractor services in Hong Kong and Macao. These services include utilities installation, infrastructure construction and civil and building services engineering for public and private projects.

During 2109, U-Tech acquired a district cooling mains construction contract from the Electrical and Mechanical Services Department at the Kai Tak development area. Other contracts secured in 2019 include U-Tech’s second contract with Evergrande Group for MVAC installation works at their residential development in Cheung Sha Wan, as well as a new contract for the supply and installation of electrical works for Henderson Land’s residential development at Kai Tak. In 2019, the company received the Safety Performance Award – Construction from the Occupational Safety and Health Council for the sixth consecutive year.

Manufacturing

M-Tech Metering Solutions Company Limited (M-Tech) is a wholly-owned subsidiary of the company that develops and markets smart gas meters. These smart commercial and residential meters, which are based on the latest technology, help to satisfy the demand for mobile payments, data management and accurate gas consumption measurement.

In late 2019, M-Tech collaborated with a well-known manufacturer of gas meters in mainland China to launch an advanced residential Narrowband Internet of Things (NB-IoT) smart meter, which replaces conventional IC card meters. This new meter works with the company’s two major IT systems – TCIS and VCC – and is designed to ensure greater data security. It also enables gas companies to perform gas consumption analysis to identify peak-shaving distribution with daily data updates, while providing end-users with the latest smart metering functions, such as mobile payments and gas leakage safety alerts.

As this smart meter is already widely accepted in the mainland residential market, M-Tech has plans to develop a similar meter equipped with NB-IoT modules for the commercial market. Another wholly-owned subsidiary of the company, G-Tech Piping System (Zhongshan) Company Limited (G-Tech), supplies polyethylene (PE) piping, fittings and related ancillary products. With the support of GH-Fusion Corporation Limited (GH-Fusion), a joint venture between Towngas and Fusion Group founded in the United Kingdom, specializing in PE fittings, G-Tech can provide clients with a range of products for piping systems. G-Tech operates eight piping extrusion lines in both its Zhongshan and Maanshan production plants.

During 2019, G-Tech set up a new distribution centre in Qingdao, Shandong Province. G-Tech plans to set up more distribution centres to satisfy business development needs. GH-Fusion also continued to explore new business opportunities in overseas markets, including Europe and the Asia Pacific.

History

The Hong Kong and China Gas Company Limited was founded in 1862.