ABOUT CHINA NATURAL GAS, INC.:

China Natural Gas, Inc. (website: www.naturalgaschina.com) is a US Delaware registered public company that owns and operates its natural gas related businesses in China. China Natural Gas is the first China based natural gas company publicly traded in the US capital markets (stock symbol: CHNG). Managed by seasoned industry executives, the Company owns a 120 kilometer long Compressed Natural Gas (CNG) pipeline located in the city of Xi'An (Population 8.5 million), the capital city of China's Shaanxi Province and a gateway to China's vast western regions. The northern region of Shaanxi Province is the home to China's second largest natural gas reserve. The Company has been consistently profitable since its inception.

China Natural Gas is the sole authorized provider of natural gas to residential customers in certain parts of the Xi'An area, including Lantian County and the Baqiao District. The Company is rapidly expanding its network of compressed natural gas filling stations to satisfy strong customer demand.

In August 2006, the Company announced expansion of their retail natural gas business into China's Henan Province, which is China's most populous province with a population of 100 million.

OUR CORPORATE HISTORY AS A PUBLIC COMPANY:

China Natural Gas became a public company in the US capital markets in December 2005 and its shares have been trading under the stock symbol "CHNG" since that time. In January 2006, the Company completed a US$10.4 million equity financing with institutional investors. The Company registered shares underlying such financing (SB-2 filed on Feb 10, 2006) with the US Securities & Exchange Commission (SEC). In May 2006, after a full SEC review, our registration was declared effective. The Company's required public filings are current and in good standing with the SEC.

WE HAVE AND ARE GROWING A PROFITABLE BUSINESS IN A FAVORABLE MARKET ENVIRONMENT

We Have Three Profitable and Growing Business lines:

End-user delivery of natural gas through residential and industrial pipelines to approximately 83,000 homes and businesses;
Wholesale natural gas to retail CNG filling stations for hybrid (natural gas/gasoline) powered vehicles;
Company-owned retail CNG filling stations for hybrid (natural gas/gasoline) powered vehicles (26 stations as of January 2008).

An Environmentally Friendly Company, We Offer Compressed Natural Gas as an Alternative to Gasoline

Many taxis and buses in China are configured to operate on both compressed natural gas and gasoline. Due to the rising cost of gasoline, taxi drivers derive significant cost benefits by utilizing natural gas for their vehicles. CNG powered vehicles not only contribute to a cleaner environment but also save drivers as much as 60% in fuel cost - the bulk of a taxi driver's daily operating expenses. To address increasing customer demand for compressed natural gas we continue to expand our natural gas distribution channels through construction and acquisition of retail natural gas filling stations. As an environmentally friendly "clean energy", natural gas has been promoted by the Chinese government as an alternative fuel to gasoline.

Long Term Growth through High Margin LNG Business:

In 2008, CHNG plans to launch its Liquefied Natural Gas (LNG) facility which is currently under construction. The LNG facility is located in the northern region of Shaanxi Province, home to China's second largest natural gas reserve. The Company has entered into a gas supply agreement with PetroChina, China's largest oil and gas company, for 150,000,000 cubic meters of natural gas annually. The LNG business, once launched, has a profit margin as high as 80% depending on the region in China to which LNG may be transported to via specialty trucks. LNG is easily transportable via CHNG's fleet of specialty trucks and therefore can overcome the geographic barriers that exist in pipeline transportation.