LPH: Wont raise capital at current PPS levels
Longwei Petroleum Plans to Increase Storage Capacity in 2011
Company Has No Intention to Raise Capital at Current Price Levels
PR Newswire
TAIYUAN CITY, China, Dec. 17, 2010
TAIYUAN CITY, China, Dec. 17, 2010 /PRNewswire-Asia-FirstCall/ -- Longwei Petroleum Investment Holding Ltd. (NYSE Amex: LPH) ("Longwei" or the "Company"), an energy company engaged in the storage and distribution of finished petroleum products in the People's Republic of China ("PRC"), today announced that it intends to expand its petroleum storage capacity in 2011 to keep up with growing demand for petroleum products in its region.
The Company wishes to clarify to its shareholders that it has no intention of raising capital at current price levels and would only issue shares in the future to make an accretive acquisition that would increase storage capacity, revenue and earnings.
"We are actively exploring strategic opportunities to take advantage of the growth in the marketplace. Our last acquisition has proven to be very successful, and we want to be prepared as we position the Company to expand our offering and customer base," stated Mr. Cai Yongjun, Chairman and CEO of Longwei.
The China Petroleum Planning and Engineering Institute recently announced that China plans to increase its oil storage capacity to 78 million cubic meters (approximately 67 million metric tons) by 2015. China had oil storage capacity of 53 million cubic meters at the end of last year and anticipates this to grow by 47% by 2015. China's two largest state-owned oil companies, CNPC and Sinopec, are expected to have 50 million cubic meters of storage capacity by 2015, while independent operators are expected to grow storage capacity to 28 million cubic meters by 2015. China has emphasized expanded oil storage and refinery capacity to increase its strategic reserves, which make it less vulnerable to market fluctuations and less susceptible to international oil conflicts.
Michael Toups, CFO of Longwei, said, "China is not only dependent on its two state-owned oil companies to increase storage capacity, but it needs independent operators to actively grow their businesses as well. We are well-positioned as the largest independent oil storage operator in Shanxi Province to continue to build our storage capacity and grow our distribution within the surrounding regions."
AI
