Primeline, CNOOC Complete ODP for Lishui Gas Discovery

Primeline and CNOOC have completed the technical work for the Overall Development Plan ("ODP") for Lishui 36-1 gas discovery and are now proceeding to finalize the ODP for submission for governmental approval.

As announced in February 2009, Primeline contracted CNOOC Research Beijing to compile the ODP. The technical work, supported by recently completed surveys and additional study results, has now been completed. Primeline and CNOOC Shanghai held a joint review meeting in late July in Shanghai to review the initial results. Following that initial review, additional work was carried out and the final review by CNOOC Head office was held August 27, 2009 in Wenzhou, the major city on the coast where the proposed offshore pipeline would arrive directly from the Lishui 36-1 gas field.

At the final technical review, the ODP was approved and accepted by CNOOC and Primeline and it was agreed that both parties will now proceed to seek internal approval from CNOOC Investment Committee and Primeline's Board before submission of the ODP for central government approval.

Primeline and CNOOC are preparing the supporting documents including a full environmental impact study report, safety assessment report and various documents from local government departments in Zhejiang Province and Wenzhou City. The environmental and safety report are planned to be submitted to the relevant authorities by the end of October. The timing for submission of the ODP will be subject to the approval by such authorities of the environmental impact study and safety assessment.