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Honghua Group and Baker Hughes Collaborate to Explore and Develop China's Unconventional Hydrocarbons Market

  Honghua Group and Baker Hughes Collaborate to Explore and Develop China's
                      Unconventional Hydrocarbons Market

PR Newswire

HOUSTON, Dec. 12, 2012

HOUSTON, Dec. 12, 2012 /PRNewswire/-- Honghua Group Limited (HK: 0196), a
leading global land drilling rig manufacturer, announced that it has signed a
Memorandum of Understanding (MOU) with Baker Hughes, a leading supplier of
oilfield services, products, technology and systems, to jointly provide
integrated operation services and carry out research and sub-surface
evaluation and engineering services for non-conventional oil and gas
opportunities in the People's Republic of China. The two companies will
jointly set up a research center for unconventional energy in Chengdu, Sichuan
Province, China, which will be principally engaged in conducting shale oil and
gas related research and consultancy services to support shale oil and gas
development. The MOU signing ceremony happened on December 11, 2012 in
Houston, Texas.

The strategic partnership will combine Baker Hughes' expertise in global
project management, reservoir technology and product solutions with Honghua
Group's strength in the production and servicing of petroleum equipment to
provide integrated solutions in unconventional hydrocarbons to existing and
potential customers.

Mr. Zhang Mi, Chairman of Honghua Group, said, "The development of
unconventional hydrocarbons industry portends a major shift in the global
energy market. The cooperation between the two industry leaders combines
industry best practices, expertise and superior technology to provide the best
integrated solutions in the market for oil and gas investors in China and
around the world."

"Baker Hughes is very pleased to be working with Honghua to jointly conduct
sub-surface research and evaluation for China's vast unconventional
resources," said Art Soucy, President, Global Products and Services, Baker
Hughes. "Both companies have considerable expertise and through this
partnership, we will be able to develop innovative solutions for our
customers."

Per the MOU, the two companies will invest in the development and testing of
technologies and solutions that are applicable to China's unconventional
hydrocarbons market. In addition, Honghua China and Baker Hughes Beijing, the
subsidiaries of Honghua Group and Baker Hughes respectively, have agreed to
start collaboration in the testing of 6,000 horsepower fracturing pump and
sub-surface smart control system for coiled tubing drilling rig..

During the MOU signing ceremony, Honghua Group and Baker Hughes hosted an
academic seminar on shale gas at the Southwest Petroleum University in
Chengdu, Sichuan Province, which focused on China's complex geographical
conditions and the opportunities and challenges in shale gas development in
China. Stanford University professor and US government energy advisor Mr. Mark
Zoback gave the keynote presentation at the seminar. Mr. Zoback is an
internationally renowned geomechanics expert and a pioneer in the application
of unconventional resource geomechanics. Mr. Zoback discussed the application
of geomechanics in shale gas exploration, and technology solutions for shale
gas exploration.

About Honghua Group:

Honghua Group Limited is a large-scale equipment manufacturer and drilling
service provider, specializing in research, design, manufacture, and
set-assembly of drilling rigs, offshore engineering, and oil & gas
exploitation and production equipment. With its land drilling rig
manufacturing base in Sichuan province, Honghua Group is the biggest exporter
of drilling rigs in China, and one of the largest land drilling rig
manufacturers in the world. For more information on Honghua, please visit
http://www.hh-gltd.com/ or http://www.hh-america.com/.

SOURCE Honghua Group Limited

Website: http://www.hh-gltd.com
Website: http://www.hh-america.com
Contact: Honghua Group Limited, Vicky Fu, +8628 8297 1852, fuhj@hhcp.com.cn;
Weber Shandwick , Sun Ying, +8610 8569 9919, ysun@webershandwick.com
 
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