SIIC Environment Holdings Ltd. has signed a supplement agreement with Wuhan Municipal Government for a concessionary period of 20 years in relation to the Hanxi Expansion and Upgrading Project in Wuhan, China. The total investment cost for Hanxi Expansion and Upgrading Project is estimated at approximately RMB 722 million and will be fully funded in cash and financed through the internal resources of the Group and/or bank borrowings. The Hanxi Expansion and Upgrading Project is entered into in the ordinary course of business and entails: expansion of the waste water treatment capacity; upgrading of the current waste water treatment facilities; construction of the new deodorization system; and construction of a new sludge processing system.

Upon the completion of the Hanxi Expansion and Upgrading Project, the daily design of Hanxi Plant will be increased from the existing 400,000 tons/day to 600,000 tons/day, with minimum off-take volume guaranteed. The discharge standard would also be upgraded from the existing Grade 2 to Grade 1B.