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Message from CEO

Safety is our number one priority and it can never be compromised on versus productivity. This is embedded in our DNA and is the foundation for sustainable growth of our business. In 2019, we implemented the Safety Roadmap which comprehensively reviews and further improves safety performance by strengthening the safety culture, supervision and systems. With all the efforts made, we achieved zero life-changing incidents in the organization. Externally however sadly enough not and we still see a large need for the improvement of customer safety awareness and behavior. We feel that we still have a long way to go to fulfill our safety responsibilities and are committed as always to continue to do so.

As a family-owned company, we know that employees are the most valuable asset of the company and we care for each employee as a member of SHV Energy China family. Guided by the core value of Invest in People, we have committed to creating a safe, diverse and inclusive work environment, inspiring employees’ potential and supporting career development and success.

For over 20 years since entering China, we see it as our responsibility to contribute to local communities. We actively carry out community activities including education programs, charity donations and events to show our care and love for the vulnerable. In 2019, we launched a new CSR project "Energize the Future" which focuses on education support to students from low-income families and ill-equipped schools, helping teenagers fulfill their dreams.

SHV Energy China has released the sustainability report in three consecutive years since 2018. Over the past three years, we have been working hard to fulfill our commitments in four areas: Environment Protection, Health and Safety, Employee Development and Community Initiatives. It fills us all with pride knowing that we have a real positive impact on society, working together to reduce carbon dioxide emissions and achieve the sustainable development goal of all while growing our business.

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Maarten BijlCEO

Contents01 Message from CEO

04 Environment

02 Sustainable Development

08 Health and Safety

12 Employee Development

14 Community Initiatives

In 2019, SHV Energy China continued to focus on our LPG and LNG businesses that enable our customers make use of or even switch to cleaner energy. We actively expanded our LNG business, accelerating the coal to gas conversion of industrial enterprises. Moreover, we continued to explore new energy innovations and solutions. The opening of our first hydrogen station in June 2019 marks a milestone in our development of SHV Energy China. It has created an option for scale-up in the hydrogen energy transportation industry and we’re learning about this market each day. The concept of environment-friendly and sustainable development remains a core part of our purpose and pushes us to keep further innovating. In 2019 we created a dedicated Renewables & BioLPG position giving resources to our ambition to bring BioLPG to China and built new business solutions for our customers.

2012Expanding business to industrial LNG

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Milestones of SHV Energy China

SHV Energy Group has been engaging in clean energy business across 20 countries in four continents with more than 30 million customers, mainly providing clean energy solutions and service, including LPG, LNG and biomass fuel. SHV Energy Group is a global leading clean energy distributor and the first large-scale distribution company for biomass LPG in the world.

SHV Energy Group is affiliated to SHV Holdings, the largest family-owned enterprise originated from Steenkolen Handels- Vereeniging in 1896. SHV Holdings presents in 60 countries worldwide with seven decentralized divisions, including energy distribution, cash-and-carry wholesale, private equity, exploration and production of oil and gas, heavy lifting and transport activities, industrial services, animal nutrition and fish feed. With approxi-mately 60,000 employees globally, its total annual sales amounted to €20.1 billion.

Operations in Chinafor more than 20 years

MemberCompanies

Employees

39

Sustainable Development

20122013Acquired cylinder gas business of BP in Shanghai, Guanzhou,

2018Acquired bottled gas business of Foshan LPG Co . Ltd.

2019Started on deploying hydrogen business and opened first hydrogen refueling station Acquired bottled gas business of Zhuhai Shin-shin Energy Co . Ltd.

2009With acquisition of Zhu-hai Gas Group, 3 newmembers joined XiweiZhuhai Gas, Yangjiang Senye and Jiang men Huayu

2007Acquired Shanghai Bestir Energy,marching into YRD market

19972006Further developed PRD marke through acquisi-tion of Dongguan Xiwei Foshan Shunran and Guangzhou Xiran

2005Launched LPG business for vehicles

SHV officially entered China

1997LPG

As a member of SHV Energy, a family-owned energy enter-

prise from the Netherlands, SHV (China) Investment Company

Limited has 39 member companies in the Pearl River Delta

and the Yangtze River Delta region with around 5000 employ-

ees. Leveraging its rich experience in the globe, SHV Energy

China has grown rapidly in various business segments, includ-

ing domestic gas, commercial gas, industrial gas, and auto-

mobile gas, serving Chinese customers with profe-

ssional, safe and innovative energy solutions.

Foshan, Zhongshan and Jiangmen

The carbon reduction target can be achieved mainly from two aspects:

300,000 tons

contributing 300,00 tonsof Carbon Reduction by 2021

We have been supporting all sectors of society to control carbon

emissions and improve local air quality through use of clean

energy, while making every effort to minimize the environmental

impact of our own operations and work with the whole society

towards the cleaner today and tomorrow.

We are committed to contributing 300,000 tons of carbon reduc-

tion across the entire value chain (from upstream supply, our own

operations, to end-use) by 2021 as an important objective of our

operational strategy.

(Note:CO eq is carbon dioxide equivalent.Standardizing the effects of various greenhouse gasse,and unified the to measure the overall greenhouse effect results)

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Our Carbon Footprint 2019

01Carbon Footprint(by process flow)

Exploitation & Production 243,650 11.2%

Upstream Transportation 18,154 0.8%

Storage - 0.0%

Primary Transportation 4,645 0.2%

Midstream Operartion 2,734 0.1%

Secondary Transportation 9,722 0.4%

Retailing 3,348 0.2%

Overhead and travel 2,570 0.1%

End Use 1,886,277 87%

Total 2,171,100 100.0%

Proportion

Carbon Emission

（mT CO eq）2

Carbon Emission（mT CO eq）

11,638.56 11,638.56

0.5%Scope 1 Direct Carbon Emission

2,155,182.112,155,182.11

99.3%Scope 3 Other Carbon Emission

Carbon Emission（mT CO eq）

4,279.83 4,279.83

0.2%Scope 2 Indirect Carbon Emission

Carbon Emission（mT CO eq）

2,171,100.50 2,171,100.50

100%

Carbon Emission（mT CO eq）

Environment

Reduce carbon emissions by switching customers to cleaner energy02

Reduce carbon emissions from self-operations

Total

We have been reviewing the carbon emissions in our operations persistently to achieve clean and green sustainable development through reducing our environment footprint by energy consumption optimization and LEAN production.

In addition to traditional energy solutions, we have explored new directions with innovative thinking to provide customers with cleaner energy. In 2019, SHV Energy started to provide bioLPG to customers in Europe, while we are also working hard to promote the supply of bioLPG in China.

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Our Carbon Impact

Solid Waste Generation

625tons

Electricity Consumption

8,711,350kwh

Water Consumption

279,459

Environmental Protection Awareness

We organize and encourage our employees to participate in various environmental protection activities to raise their awareness on sustainable development and low-carbon emission. We inspire our staff at different locations to take action to the Earth Hour initiative in response to WWF's call to save energy, At the same time, we organized our staff and their families to participate in the first Tree-planting Day of SHV Energy China.

SHV's First Hydrogen Station

We proactively embrace energy innova-tion and reform in China and opened SHV Energy’s first hydrogen refueling station worldwide, which opened a completely new chapter in clean energy use for transportation. We look forward to accelerating progress towards more renewable energy, including biomass energy, to contribute to better air quality through energy upgrades and conversion.

Green Enterprise Award

With the extraordinary performance in environmental protection and sustainable development, we won the Green Enterprise Award for outstanding contribution of European enterprises in China in 2019 held by the European Chamber Union of Commerce in China. This is an inspiration and encouragement to us. We will continue to meet our commitments to environmental protec-tion and social responsibility with our actions and reduce the impact of environ-mental pollution and carbon emissions to sustainable development.

To address the long-standing issue in handling the waste-water generated from the LPG storage tank retesting, we explore an innovative measure of using portable equipmant to process waste-water through many experiments. The equipmant can be reused for multiple sites .can be used in different filling plants which greatly reduced the cost of water processing and offered an alterna-tive to improve environment protection.

Wastewater Treatment

Cylinder Retesting Energy Saving

The surface treatment process for cylinders at cylinder retest stations is changed from incineration to steam purging. The dust treatment system for shot blasting has also been upgraded. By taking those measures, use of LPG was reduced by 16 tons and electricity by 36,000kwh a year, which significantly reduced the energy consumption and improved the working environment to safe guard the occupational health of our employees.

44,471 tons

of Planting

Pine Trees267,000and Let Them Grow 25 Years

Total

Carbon Emission Reduction

(mT CO eq)2

44,471Carbon Emission Reduction

(mT CO eq)2

Carbon Emission Reduction

(mT CO eq)

Carbon Emission Reduction

(mT CO eq)

Carbon Emission Reduction

(mT CO eq)

Carbon Emission Reduction

(mT CO eq)

Carbon Emission Reduction

(mT CO eq)

24,969

Coal

16,348Wood

1,878Fuel oil

1,242Electricity

25Diesel

Petrol

92

2

2

2

2

End-user Energy Switching

The photovoltaic power generation project continues to bring us clean power supply with the total generation capacityincreased from 140,358kwh in 2018 to 158,828kwh in 2019, an increase of 13% which is enough for an average family to use for about 25 years.

Photovoltaic Power Generation

Reducing carbon emissions by assisting our customers to use cleaner energy (refer to as Carbon Impact) is an important strategy to achieve our overall carbon reduction targets. We have worked closely with our customers to achieve the conversion of wood, coal and petroleum to LPG and LNG, and thereby helping domestic and industrial customers to reduce energy consumption and carbon emissions.

In 2019, total 44,471 tons of CO2 reduction was achieved in 2019 by energy conversion, this is equivalent to the impact of planting 267,000 pine trees and let them grow for 25 years.

CO2 ReductionEquivalent to the Impact

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We are committed to providing a healthy and safe working

environment for employees as well as providing safe and

high-quality products to our customers. Meanwhile we en-

hance the safety culture in company-wide, and improve cus-

tomers' knowledge and ability on gas safety.

Safety has always been the most important foundation of all

the works. We are continuously raising our own safety stan-

dards and at the same time leading the industry to grow in a

sustainable and safe way.

88,063hours Safety Training 6.8%

2,499times Safety Audits 10.6%

701timesEmergency Drills

6,354itemsImprovement Actions 14.9%

SafetyTraining

Emergency drill

Safety Audits

ImprovementActions

We have always been committed to safety, and that is why "no compromise on safety" applies to our entire business, including process safety, product safety, transportation safety, emergency management and customer safety. Leading the business towards the goal of “Zero accidents, zero injuries and zero pollution" through continuous improvement in safety manage-ment, more investments in safety and enhancing the safety awareness of employees and customers.

Safety Roadmap is one of the important safety targets for SHV Energy in 2019. We have made improve-ments in 11 items set from 3 different perspectives including visible felt leadership (VFL), transport and manual handling. We made comprehensive assessments on safety management behaviors, and strove to improve safety culture. We organized staff of all levels for different trainings, such as site visit management, NEBOSH training, risk assessment training, manual handling training, defensive driving training, etc. By doing so, we’d like to ensure the effective implementation of the safety roadmap and improve safety management performance.

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Hazard and Operability analysis (HAZOP) is an important component of operational safety improve-ment project OWNERship. The hazard and operability analysis on 40 sites in China (including filling plants, autogas stations, hydrogen stations, LNG bulk stations) were completed in 2019 with a deeper understanding on the process design of different stations and inherent characteristics in production. Potential safety risks in the process were identified and improvement suggestions were set forth. Through on-site training and practice, operation and safety personnel in OPCOs had expanded their knowledge of safety management and greatly improved site process safety. The project also updated the site process flow diagram, put together a list of critical equipment, and further improved the existing operating safety management system.

05We attach great importance to our employees' personal safety. In addition to routine personal protective equipment, we equip employees in key positions with high-standard fire resistant clothes, safety shoes with metatarsal protection and safety glasses to better protect our staff.

04To further strengthen employees' safety awareness and get them more familiar with the safety essentials in daily work, SHV Energy Group has developed the Life Saving Rules and supporting animation videos and posters. We also organized Family Safety Day and contests to raise employ-ees' awareness on safety, helping them keep in mind of the safety cautions that need to be addressed at work.

At the 7th China International Chemical Logistics Supply Chain Summit, SHV Energy China won the annual Excellent Case Award for Chemical Supply Chain Innovation and Application with its industry-leading logistics Route Optimization System (ROS) and intelligent Transport Management System (TMS). With the application of these systems, SHV Energy China can achieve the whole-pro-cess control and optimization over logistic vehicle routes, monitor vehicle safety in real time and come up with improvement recommendations. After the system being put into use, the incident rate of logistic vehicles dropped by 47% and logistic efficiency was estimated to go up by 14%.

03

Health and Safety

08

Lost Time Incident Rate

15%Vehicle Incident Rate

23%Customer Incident Rate

15%

1110

290times

Assist government with Emergency Rescues

424sessionsSafety Education in Community

73pcs12sessionsSafety Education in School

Gas Knowledge Boards in Community

213sessionsJoint Safety Inspection

59,467ItemsAddressed Safety Hazards for Customers

In the afternoon of August 19, 2019, a third-party company tanker carrying 23.5 tons of LPG overturned on the G4 Beijing-Macau expressway, causing traffic disruption on the road ramp and a risk of leakage. The rescue team of Guangzhou company rushed to the scene upon incident report, and worked with relevant departments to carry out emergency rescue. They followed the rescue operation on site and began pouring the tanker at 6am on the next day. After working for over 20 hours, the team success-fully transferred the LPG to a new tanker and eliminated hidden dangers at 11am on August 20. This accident and rescue operation were widely reported and covered by mass media.

Guangzhou Rescue Team SuccessfullyEliminated Road Hazards

Gas Safety Education held in a school in Zhuhai

In June 2019, Xiwei Zhuhai and Construction Bureau of Gaolan Port jointly held a safety education campaign themed Safety with You at Pingsha Town No.2 middle school, teaching students practical gas safety knowledge through animations and interactive activities, inspired them to apply what they have learned in daily life and ensure safe use of gas in their families.

Daluo Gas Station Emergency Drill - Joint Emergency Response by Government and Enterprise

In November 2019, an LPG cylinder refilling and leakage emergency drill was held at Daluo filling plant in Guangzhou. Government authorities, industry associations and over 100 representatives from gas enterprises participated in the event. Safety experts from Xiwei Guangzhou introduced the emergency management system and safety training experi-ence, and shared the knowledge of emergency plan prepara-tion and safety inspection for gas cylinder refilling. The drill was highly appreciated by the attendees from gas industry and improved the safety management level of the industry.

Safety Training to Staff’s Family

In November 2019, SHV Energy China organized the Family Safety Day -- EHS with You. This event aimed to make every employee's family fully understand, through teaching and entertainment, that EHS can indeed assure people's health and happiness in work and life. While learning the practical safety tips, people were also expected to integrate the concept of environmental protection, health and safety into their lives so that everyone can enjoy the good life with safety guaranteed.

Jiangmen Rescue Team in Action

In October 2019, a suspected gas leak occurred in a community in Heshan, Jiangmen. Jiangmen rescue team rapidly activated the emergency response mechanism and worked closely with the local government for several days and nights to eliminate the hazards. The rescue efforts were highly appreciated by the local government leaders. Positive comments were given by government depart-ments to Jiangmen rescue team for their quick, profession-al and proactive response in the rescue.

To listen and understand more about our customers and to strengthen gas safety education among the customers, the first Xiwei customer experience center located in Zhongshan was established on October 20, 2019. The experience center consists of three parts: brand development, safe use of gas and customer interaction. Through various publicity materials and interactive activities, customers can experience our products and services, learn about safe use of gas and reinforce safety awareness.

First Customer Experience Center Established in Zhongshan

Customer Safety

It is an important job to keep improving our customers’ safety

awareness. Therefore, various type of customer safety education

activities were carried out in different regions.

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We trust and support employees to develop their strengths

and encourage them to keep trying new ways of working

and to drive changes. We (the company and employees)

work together to create a work environment of dedication,

motivating employees to maximize their potentials to

achieve self-fulfillment and a better work-life balance.

Through a series of comprehensive training and develop-

ment processes and systems, we improve the skillsets of our

employees and thereby enhance the organization's sustain-

able competitiveness of core talents.

Training hours

29,820hours

Total Training Hours (man-hour)

13,792hoursTraining on Specialized and General Skills

8,260hours

Training on Leadership

7,768hours

Training on Basic Knowledge

The Lean School aims to support the company's strategic objectives by develop-ing lean talent at all levels and to form a lean culture within the organization. In addition, to promote the company's contin-uous improvement activities, to reduce costs for the company and to improve performance output. In 2019, 22 LEAN ambassadors took the "Yellow Belt" program. They have completed phase I & II training so far and visited the benchmark enterprise. At the same time, each LEAN ambassador has initiated and led "Yellow Belt" projects in their responsible regions and maximize their contributions to the company by training other employees.

In 2019, to further strengthen sales team’s capability, improve work efficiency and increase sales volume and profit, SHV Energy China initiated a sales perfor-mance analysis, put forward an improve-ment proposal, completed the design of sales structure optimization, developed related sales training courses, and sorted out tool kit for sales new hires

SHV Energy China launched online courses on e-learning platform. It enables our employees to take trainings via mobile phones and PCs whenever and wherever possible. In 2019, over 1,500 staff took the online courses. More online courses will be developed to make it easy for our employees to access more learning resources.

In 2019, to accelerate talent development and team building in adaption to rapidly changing business and organizational development needs, we updated and unified the criteria for talent measure-ments. By rolling out the new SHV leader-ship model, developing related leadership training courses and building the assessment center, a common talent development "language" has been formed in the company and will advance talent development and talent mobility across regions

Leadership Improvement

Train High-potential Supervisors

Lean Talents

Improvement on SalesPerformance

E-learning Platform Goes Live

28%Percentage of Female

24%Percentage of Senior Female Managers

6,118man-time

Total Number of Employees Attended Training in 2019

29,820hours

Total Training Hours

Employee Development

5,000Employees

The JUMP Program is a one-year training and development program designed for front-line managers and supervisors, which aims to improve their all-around management and business skills through a three-phase training and action learning projects. In 2019, 26 outstanding supervi-sors completed this training program. And their action learning projects got excellent results, and won two professional awards in the 9th Performance Improvement Forum held by the International Perfor-mance Improvement Association in Beijing on November 8.

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As a locally based enterprise, we always see ourselves as part of the community and strive to contribute to the sustainable development of the community in our operations. We organize community activities, such as education support, dona-tion and charity visit with the intent to demonstrate our care to vulnerable groups, pass on the spirit of great love and social responsibilities.

New Year Visit to Families in Need

During the Spring Festival of 2019, volunteers from Xiwei Foshan visited the families in need in Denggang Village with local village leaders from Xinan town in Sanshui district. The volunteers sent living supplies to the families as a new year greeting and also performed safety inspection on the gas cylinders and hoses for them.

Community Evening for Gas Safety

In March 2019, Xiwei Zhongshan jointly hosted a show themed Gas Use Safety to Benefit All Families with Nanlang township government and Zhongshan Gas Association. The show aimed to promote the knowledge of safe use of gas to residents in the communities.

Healthy Hiking

In March 2019, Xiwei Dongguan organized a five-kilometer hiking to promote gas use safety. Inspiring and fun games were designed and set up along the hiking trail. It was not only to promote safety knowledge but also to encourage a healthy lifestyle through regular exercising.

Zhongshan Charity Walk

Xiwei Zhongshan has participated in the annual charity walk in Zhongshan for 5 consecutive years, to spread the love and care in the spirit of the city also in the spirit of Xiwei.

Initiate Energize the Future project

Energize the Future is the CSR project initiated by SHV Energy China in 2019, focusing on teenager education. It includes donation of library to schools in remote areas and scholarships for college students from low-income families.

The first library of “Energize the Future” project opened in a Yao primary school in Liannan county of Guangdong province in December 2019. Most students come from low-income families in poor mountainous area in northern Guangdong and a large majority of them are left-behind children. This library created a colorful world of knowledge for children who lack companionship of parents.

The project also provides scholarships to college freshmen from low-income families. In 2019, 11 students were selected through application materials and home visits.

Energize the Future project has won support and praise from local communities as well as our employees. We will continue to work with all OPCOs to develop more CSR activities focusing on education support to local communities.

29Volunteer and charity activities

12Public welfare activitiesin schools

13Parent-child and public health activities

Persons engaged in community activities

>100,000 people

Community Initiatives

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SHV (China) Investment Company Limited

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