China Sanjiang Fine Chemicals Co. Ltd. (China Sanjiang) announced that its wholly owned subsidiary, Sanjiang Chemical, has entered into a Naphtha Purchase Agreement with Blue Whale Bioenergy on 2 April 2026, covering the period from the signing date to 31 December 2026.
The contract: • Scope: Supply of biomass-based naphtha for Sanjiang Chemical’s production facilities. • Pricing: Determined by mutual agreement, benchmarked against the prevailing hydrogenated naphtha price in Shandong as quoted by the Longzhong Information platform, ensuring market-aligned terms. • Annual cap: Transaction value capped at RMB 88.00 million (approximately USD 12.44 million) for the contract period. • Historical dealings: No prior transactions between the two parties from 2023 to 31 March 2026.
Strategic rationale: • Sanjiang’s recently commissioned 1 million-tonne per-year Phase VI ethylene oxide/ethylene glycol complex and its upstream Naphtha/Ethane/Propane-to-Ethylene/Propylene unit have lifted the Group’s overall output capacity by about 80%. • Securing an additional naphtha supplier is expected to strengthen feedstock stability and operational flexibility for the expanded facilities.
Regulatory context: • Blue Whale Bioenergy is 41% owned by Zhejiang Zhongxin Enterprise Management, which in turn is 60% held by Ms Guan Siyi and 40% by Ms Han Jianhong—both executive directors of China Sanjiang and related parties to controlling shareholder Mr Guan Jianzhong. Consequently, Blue Whale Bioenergy qualifies as a connected person under Hong Kong Listing Rules. • Given that applicable percentage ratios exceed 0.1% but are below 5%, the transaction is classified as a continuing connected transaction subject to reporting, announcement and annual review requirements, but exempt from independent shareholders’ approval under Chapter 14A. • Directors Ms Han and Ms Guan abstained from voting on the board resolution approving the agreement; no other directors were required to abstain.
Company profile: China Sanjiang produces ethylene oxide, ethylene glycol, polypropylene, methyl tert-butyl ether, surfactants and related chemical products in the PRC, and also provides processing services for these products.