According to the report from Zhitong Finance APP, HONGHUA GROUP (00196) announced that its subsidiary SiChuan HONGHUA Electric Co., Ltd. (HONGHUA Electric) successfully won a two-year Shale Oil fracturing service project from a domestic client, with a contract amount of approximately 0.58 billion yuan. Recently, HONGHUA Electric signed the first-year Shale Oil fracturing service contract with the domestic client, with a contract value of about 0.29 billion yuan. According to the service contract, HONGHUA Electric will provide a series of electric fracturing equipment and services for the development of Shale Oil.

The service contract was established after HONGHUA Electric negotiated with the domestic client on the basis of fairness. The terms of the service contract are normal commercial terms, fair and reasonable.

Due to the increase in Global oil demand and the decrease in traditional oil resources, the market demand for Shale Oil is continuously rising. Oil & Gas is an important strategic replacement resource for the development of Oil & Gas in our country. Due to the complexity of its extraction technology, it has always been a focus within the Industry. In recent years, through continuous technological breakthroughs and iterative upgrades, the scale and capacity of Shale Oil extraction in our country have been continuously expanding. The company leverages the successful experiences gained during the development of electric fracturing equipment and field application practice, introducing all-electric fracturing technology to improve extraction efficiency while reducing environmental pollution, achieving low-cost and high-efficiency development of unconventional Oil & Gas, and enhancing the core competitiveness of the company's fracturing equipment and services. The signing of this contract marks the first entry of the company's electric fracturing equipment supplementary Construction service into a certain Shale Oil market, highlighting that the reliable quality of the company's products and excellent services have gained more trust and recognition from clients. It also holds milestone significance for the company to further promote the implementation of the electric drive concept, establish industry benchmarks, and occupy a high ground in the market.