Exhibit 10.12
Translated from Original Mandarin
Debts Settlement Agreement
Party A: Songyuan City Yuqiao Qianan Hong Xiang Oil and Gas development Co., Ltd
Party B: Songyuan City Yuqiao Oil and Gas development Co., Ltd
During period of both parties cooperatively developed the Qian112 oilfield from March of 2003 to March 31,
2006, Party B was previously responsible to redeem the oil sales revenue to Party A. In order to make a final
settlement to the debtor-creditor relationship between both parties which additionally confirmed by the
accountants and auditors, both parties agree that Party B owed total amount of RMB 5,364,308.4 to Party A.
Base on the mutual understanding, both parties agree the following debts settlement:
Party A: Songyuan City Yuqiao Qianan Hong Xiang Oil and Gas development Co. Ltd
[SEAL]
Party B: Songyuan City Yuqiao Oil and Gas development Co., Ltd
[SEAL]
Date: April 12, 2006
1.
Amount of the debts
The total amount of the debts which Party B owes Party A is RMB 5,364,308.4
2.
Term of Settlement
Party B shall repay all the debts to Party A on or before May 30th, 2006.
3.
Liability for the breach of agreement
•
If Party B fails to repay the debts to Party A in full amount on time, Party B
shall bear the 5% penalty to the total value of debts.
•
If Party B violates any terms of the settlement agreement, it could be treated
as the breach of agreement, Party A shall file a lawsuit against Party B at
local court at any time.
Legal representative of Party A
/s/ Wang Hong Jun
Legal representative of Party B
/s/Wang Bing Wu