Major Milestone

In April 1996 , Wuhan Electric made a successful bid in an international tender for a contract of a boiler make-up water treatment for the Zhejiang Beilun 3 X 600 MW Power Plant Project and subsequently subcontracted the work to Wuhan Kaidi Water. This marked Wuhan Kaidi Water's first foray into the provision of such boiler make-up water treatment systems.

August 1997 , Wuhan Electric was awarded a contract to install water treatment state for Phase 2 of the Jiangxi Fengcheng 4 X 300 MW Power Plant Project

In 1998 , Kennicott Water Systems Limited became our supplier of the CONESEP “S” technology, a special technique applied to water condensate treatment systems which was developed by Christ-Kennicott Water Treatment Company. This technique was successfully applied by Wuhan Kaidi Water in the Jiangsu Taicang 2 X 300 MW Power Plant Project.

In April 1999 , Wuhan Electric was awarded a contract with the Shanxi Datong Coal Power Plant and subsequently sub-contracted the supply of a reverse osmosis system to Wuhan Kaidi Water, which signified our entry into the supply of such systems.

Wuhan Kaidi Water was also awarded a sub-contract from Wuhan Electric in April 1999 in relation to the Shanxi Qinling Power Plant Project. This contract is in relation to a pioneer project in the PRC involving the treatment and recycling of industrial wastewater for power plants that are able to generate 1 million kilowatts of energy.

Wuhan Kaidi Water achieved ISO9000 certification in recognition of the high standards that we have imposed on our quality management systems in the course of running our business operations.

In May 2001 , seeing the potential in the provision of automated control systems, Wuhan Kaidi Water started providing automated control systems.

In August 2001, Wuhan Kaidi Water was awarded a contract to provide condensate water treatment services for the Shanghai Waigaoqiao 2 X 900 MW Power Plant Project, which at the time of contract, had the largest capacity in the PRC.

In the same month, our previous subsidiary, Wuhan Kaidi Measure & Control entered into a contract to provide a coal conveying control system for the Ningxia Shizuishan 4 X 300 MW Power Plant Project. This contract signified our official entry into business operations relating to such control systems.

In April 2002 , our previous subsidiary, Wuhan Kaidi Measure & Control was awarded a sub-contract from Wuhan Electric to operate the control system for flue gas desulphurization for the Guangzhou Hengyun [1 X 210 MW] Power Plant Project. It was during this project that we upgraded our control systems from the PLC model to the DCS model.

In September 2002, Wuhan Kaidi Water introduced the EDI water purifying technology by General Electric ( China ) Co., Ltd. and applied such technology to the Henan Languang Power Plant Project in the course of providing treatment services for boiler make-up water. This signified the first time we supplied membrane technology for an entire project.

In April 2003 , Wuhan Kaidi Water was appointed by Christ-Kennicott Water Technology Ltd as the exclusive distributor of the CONESEP ”S” technology in the PRC on a long-term basis until 12 December 2011.

In October 2003, we ventured into the municipal wastewater treatment industry by entering into a contract with Huaneng International Power Co., Ltd to procure and install standard equipment for a municipal wastewater treatment system. We also obtained certificates for being a preferred supplier in relation to the provision of water treatment systems for power plants with capacities of 200 MW, 300 MW and 600 MW respectively. These certificates are awarded jointly by China Power Construction Consultancy Co Ltd and China Power Equipment Co Ltd, the consulting agencies which regulate the construction of power plants by state-owned enterprises. We believe that these certificates will strengthen our ability to tender for projects by state-owned enterprises relating to the construction of power plants with capacity of 200 MW, 300 MW and 600 MW respectively.

In March 2004 , Wuhan Kaidi Water secured, through a tender, a contract from Wuhan New City Waste Water Treatment Co., Ltd. (a subsidiary of Wuhan Electric) to procure standard equipment to the wastewater treatment plant in the Wuhan New Economic Development Zone.

In order to streamline our operations, our previous subsidiary, Wuhan Kaidi Measure & Control was dissolved on 11 June 2004 and its assets (including its automated control systems business) and liabilities were amalgamated with Wuhan Kaidi Water.

In July 2004, our associated company, Wuhan Hanxi, obtained a business licence to build and operate a municipal wastewater treatment plant in Wuhan City . The aggregate proposed investment value is approximately RMB463 million and its registered capital is RMB100 million

In October 2004, Wuhan Kaidi Water was awarded a contract to provide condensate water treatment system services for the Huaneng Yuhuan 4 X 1,000 MW Power Plant Project, which was at the Latest Practicable Date, the power plant with the largest capacity in the PRC.

In December 2004, Wuhan Kaidi Water was awarded three certificates from the Quality Assurance Centre of China Association for Quality (" QAC "). Wuhan Kaidi Water obtained a Certificate of Quality Management System, a Certificate of Occupation Health & Safety Management System and a Certificate of Environmental Management System. These certificates were awarded in respect to Wuhan Kaidi Water's engineering design and technical services in treatment of municipal and industrial wastewater as well as the electronic and petrochemical industries.