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BEIJING, Dec. 14, 2015 /PRNewswire/ -- Recon Technology, Ltd. (NASDAQ: RCON) ("Recon" or the "Company"), a leading independent oilfield services provider operating primarily in China, announced today that Beijing BHD Petroleum Technology Co., Ltd. ("BHD"), a wholly-owned subsidiary of the Company, won a major bidding contract with PetroChina Co., Ltd. ("PetroChina") and has been deemed a Class A Furnace Supplier to all PetroChina's oilfield companies. With this bidding and qualification, BHD will participate in PetroChina's furnace procurement program, which was worth over RMB 2.9 billion (approximately $457 million) during the period Oct. 2015 to Sep. 2017.
The Company also announced today that BHD has secured a RMB 3.22 million (~$0.5 million) contract to supply five furnaces to PetroChina's Huabei Oilfield under this Bidding process.
The Centralized Procurement program is a major part of PetroChina's procurement strategy, led by the Group Company of PetroChina. Under this program, PetroChina collects material requirements from its subsidiary companies and conducts a strategic bidding process to secure a limited number of designated suppliers. All purchases of related products are then procured from the designated Class A suppliers who were selected through the bidding process. This process helps PetroChina and its suppliers establish long-term relationships and realize mutual benefits and development. The bidding process for furnaces began in October 2014, with around 130 suppliers competing in two rounds of bidding based on technical and commercial performance standards. Only 27 companies were selected in this process, of which 16 companies are PetroChina affiliates or subsidiaries, eight are private companies qualified as Class A suppliers and the remaining three qualified as Class B suppliers.
Mr. Shenping Yin, Chairman and CEO of Recon, stated, "This qualification and contract win is a testament to our technical strength and service quality as one of the leading independent oilfield product and service providers to PetroChina. With this qualification, Recon now can participate in all of PetroChina's furnace markets. Beyond our current client base, such as Huabei Oilfield, Qinghai Oilfield and Jilin Oilfield, we expect meaningful furnace orders from PetroChina's affiliated oilfields, such as Daqing Oilfield, Jidong Oilfield, Tuha Oilfield and Changqing Oilfield, to drive a healthy recovery of our furnace business in the next few years. As there are only a limited number of PetroChina approved suppliers, the competition is significantly reduced. This will allow us to increase our client base, while reducing resources devoted to building our client base, and allow us to devote more of our efforts to product improvement to better serve our clients.
About Recon Technology, Ltd.
Recon Technology, Ltd. (NASDAQ: RCON) ("Recon") is China's first independent oil and gas field service company to be listed on NASDAQ. Working closely with leading global partners, Recon has achieved rapid growth supplying China's largest oil and gas exploration companies, including Sinopec and China National Petroleum Corporation, with advanced automated technologies, efficient gathering and transportation equipment and reservoir stimulation measures. The solutions Recon provides are aimed at increasing gas and petroleum extraction levels, reducing impurities, improving safety and lowering production costs. For additional information, please visit www.recon.cn.
Statements made in this release with respect to Recon's current plans, estimates, strategies and beliefs and other statements that are not historical facts are forward-looking statements about the future performance of Recon. Forward-looking statements include, but are not limited to, those statements using words such as "believe," "expect," "plans," "strategy," "prospects," "forecast," "estimate," "project," "anticipate," "aim," "intend," "seek," "may," "might," "could" or "should," and words of similar meaning in connection with a discussion of future operations, financial performance, events or conditions. From time to time, oral or written forward-looking statements may also be included in other materials released to the public. These statements are based on management's assumptions, judgments and beliefs in light of the information currently available to it. Recon cautions investors that a number of important risks and uncertainties could cause actual results to differ materially from those discussed in the forward-looking statements, including but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in reports filed by the company with the Securities and Exchange Commission. Therefore investors should not place undue reliance on such forward-looking statements. Actual results may differ significantly from those set forth in the forward-looking statements.
All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.
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