For immediate release

18 December 2014

Recommended Acquisition

of

FORTUNE OIL PLC

resulting in the holding by

FORTUNE DYNASTY HOLDINGS LIMITED

(a company that is owned by (i) a member of the

Vitol Group and (ii) First Level Holdings Limited)

of the entire issued and to be issued ordinary share capital of

Fortune Oil not already held by the Consortium to be effected by a scheme of arrangement

under Part 26 of the Companies Act 2006

Summary

·          The Fortune Dynasty Board and the Independent Fortune Oil Directors are pleased to announce that they have reached agreement on the terms of a unanimously recommended acquisition to be made by Fortune Dynasty for the entire issued and to be issued ordinary share capital of Fortune Oil that is not already owned by the Consortium. The Consortium currently holds, directly or indirectly, 1,472,383,697 Fortune Oil Shares, representing approximately 56.91 per cent. of the issued ordinary share capital of Fortune Oil. It is anticipated that the Acquisition will be implemented by way of a Court-sanctioned scheme of arrangement of Fortune Oil under Part 26 of the Act.

·          Fortune Dynasty is a limited liability company incorporated in the British Virgin Islands that is owned (i) 55per cent. by First Level (a company owned by Daniel Chiu and Dennis Chiu, each being a Fortune Oil Director) and (ii) 45 per cent. by Vitol Bermuda. 

·          Under the terms of the Acquisition, which is subject to the Conditions and further terms set out in Appendix I to this Announcement, if the Scheme becomes Effective those Scheme Shareholders on the register of members of Fortune Oil at the Scheme Record Time will receive:

 (Note: Restricted Overseas Shareholders will not be entitled to receive a CVR due to applicable securities laws restrictions)

·          The Acquisition, excluding the CVRs, values the entire issued and to be issued share capital of Fortune Oil at approximately £259 million.

·          The Acquisition, including the CVRs, values the entire issued and to be issued share capital of Fortune Oil at approximately £388 million.

·          The Acquisition represents an immediate cash premium, excluding the CVRs, of approximately:

o  58.5 per cent. over the Closing Price of 6.31 pence per Fortune Oil Share on 17 December 2014, being the last practicable day before the date of this Announcement;

o  42.0 per cent. over the average Closing Price per Fortune Oil Share for the one (1) month period immediately preceding 17 December 2014, being the last practicable day before the date of this Announcement; and

o  29.6 per cent. over the average Closing Price per Fortune Oil Share for the three (3) months immediately preceding 17 December 2014, being the last practicable day before the date of this Announcement.

·          Pursuant to the terms of the Acquisition, holders of Scheme Shares on the register of members of Fortune Oil at the Scheme Record Time (other than Restricted Overseas Shareholders) will receive one CVR for each Scheme Share that they hold. The CVR is intended to enable Scheme Shareholders (other than Restricted Overseas Shareholders) to share in the proceeds of any sale by the Fortune Oil Group and China Gas Group of a material proportion of their current holding of China Gas Holdings Shares within 12 months of the Effective Date, if certain conditions and thresholds are met. Each CVR will provide Scheme Shareholders (other than Restricted Overseas Shareholders) with a contingent right to receive 5 pence in either cash (subject to any applicable deductions or withholdings) or, if they so elect, Loan Note(s) (subject to applicable securities laws), in each case subject to and in accordance with the terms and conditions of the CVR Deed Poll. The CVRs are complex instruments and a number of factors will determine whether any amount will actually be paid to Scheme Shareholders (other than Restricted Overseas Shareholders) by way of the CVRs. No interest is payable in respect of the CVRs or the Loan Notes.  Further details in respect of the CVRs will be contained in the Scheme Document.

·         Applicable securities laws may prevent the issue and/or holding of CVRs in certain jurisdictions (other than the United Kingdom).  Accordingly, the entitlement to receive a CVR will not be extended to Scheme Shareholders who are Restricted Overseas Shareholders. 

·          The Independent Fortune Oil Directors, who have been so advised by VSA Capital, consider the terms of the Acquisition to be fair and reasonable.

·          In providing advice to the Independent Fortune Oil Directors, VSA Capital has taken into account the commercial assessments of the Independent Fortune Oil Directors. Accordingly, the Independent Fortune Oil Directors have unanimously and without qualification determined to recommend that:

o  Scheme Shareholders vote (or procure votes) in favour of the Scheme at the Court Meeting and Fortune Oil Shareholders vote or procure votes in favour of the Resolutions at the General Meeting; or

o  in the event that the Acquisition is implemented by way of an Offer, Fortune Oil Shareholders (excluding the holders of the Excluded Fortune Oil Shares) accept (or procure acceptances of) the Offer.

·          It is intended that the Acquisition will be implemented by means of a scheme of arrangement under Part 26 of the Act (or, if Fortune Dynasty elects and the Takeover Panel consents, an Offer). The Acquisition is conditional on, among other things, (i) the approval of Scheme Shareholders at the Court Meeting and the passing of the Resolutions relating to the Acquisition (including the Capital Reduction) at the General Meeting and (ii) the sanction of the Court.

·          In the event that the Acquisition is to be implemented by way of an Offer, the Fortune Oil Shares (other than holders of the Excluded Fortune Oil Shares) will be acquired pursuant to an Offer fully paid and free from all liens, charges, equitable interests, encumbrances and rights of pre-emption and any other interests of any nature whatsoever and together with all rights attaching thereto.

·          Fortune Dynasty has received irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the Resolutions relating to the Acquisition (including the Capital Reduction) at the General Meeting (or in the event that the Acquisition is implemented by way of an Offer, to accept the Offer) from Frank Attwood and Tian Jun (the only Independent Directors who hold Fortune Oil Shares) in respect of their own beneficial holdings of Fortune Oil Shares amounting, in aggregate, to 3,693,220 Fortune Oil Shares, representing approximately 0.14 per cent. of the issued ordinary share capital of Fortune Oil and 0.33 per cent. of the Scheme Shares held by the Scheme Shareholders entitled to vote at the Court Meeting), in each case at 17 December 2014 (being the last practicable day before the date of this Announcement).   Further details of these Irrevocable Undertakings are set out in Appendix II to this Announcement.

·          Further details of the Acquisition will be contained in the Scheme Document that will be posted to Fortune Oil Shareholders along with notice of the Court Meeting and General Meeting, the Forms of Proxy and the Form of Election as soon as practicable.  It is currently anticipated that the Scheme Document will be posted to Fortune Oil Shareholders shortly following 14 January 2015 (the Takeover Panel having consented to a short extension to the usual 28 day period for posting of a scheme document following the announcement of a firm intention to make an offer under the Takeover Code, to accommodate Court availability in the period following the date of this Announcement).

·         It is expected that the Scheme will become Effective in March 2015, subject to the satisfaction or waiver of the Conditions and further terms set out in Appendix I to this Announcement.

Commenting on the Acquisition, Daniel Chiu, Chairman of Fortune Dynasty said:

"In recent years, Fortune Oil has struggled to gain sufficient interest from investors to maintain a reasonable level of active trading in its shares. This has resulted in a disappointing performance for many shareholders, including myself. Since the disposal of the natural gas business in 2013, the divergence of interests amongst Fortune Oil shareholders has become increasingly apparent. Together with my consortium partners in Fortune Dynasty, we believe a cash offer at a substantial premium to the current share price is the best means of resolving these divergent interests, and provide a means for all shareholders to realise value for their shares in cash."

Commenting on the Acquisition, Qian Benyuan, Chairman of Fortune Oil said:

"We are pleased to announce a recommended offer for Fortune Oil plc. The Independent Directors have sought to obtain a fair and reasonable offer on behalf of, and in the best interests of, all Fortune Oil Shareholders. We believe that the offer by way of a scheme of arrangement represents an attractive outcome for Fortune Oil Shareholders and we unanimously support the Scheme and are all hopeful that the Scheme will be passed by Fortune Oil Shareholders successfully."

Enquiries

Standard Chartered Bank:

(Financial Adviser to Fortune Dynasty)

David Harvey-Evers                                                                  Tel: +44 (0)207 885 9999

Fortune Oil:

Frank Attwood                                                                           Tel: +44 (0)207 096 9580

VSA Capital Limited:

(Financial Adviser to Fortune Oil)

Andrew Raca                                                                             Tel: +44 (0)203 005 5000

Justin McKeegan                                                                       Tel: +44 (0)203 005 5000

This summary should be read in conjunction with the full text of the following Announcement and its appendices. 

The Conditions to, and certain further terms of, the Acquisition are set out in Appendix I to this Announcement. Details of undertakings received by Fortune Dynasty are set out in Appendix II to this Announcement. The sources and bases for certain financial information contained in this Announcement are set out in Appendix III to this Announcement.  Terms used in this Announcement (including this summary) have the meanings attributed to them in Appendix IV.

Important disclaimers (including in relation to securities law restrictions)

This Announcement is not intended to and does not constitute or form part of any offer to sell or subscribe for or any invitation to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Acquisition or otherwise.  The Acquisition will be made solely pursuant to the terms of the Scheme Document (or, if applicable, the Offer Document), which will contain the full terms and conditions of the Acquisition, including details of how to vote in respect of the Acquisition.  Any decision in respect of, or other response to, the Acquisition should be made only on the basis of the information contained in the Scheme Document (or, if applicable, the Offer Document).  

The release, publication or distribution of this Announcement in jurisdictions other than the United Kingdom may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves about, and observe any applicable requirements. This Announcement has been prepared for the purpose of complying with English law and the Takeover Code and the information disclosed may not be the same as that which would have been disclosed if this Announcement had been prepared in accordance with the laws of jurisdictions outside the United Kingdom.

No person has been authorised to make any representations on behalf of Fortune Oil or Fortune Dynasty concerning the Scheme or the Acquisition which are inconsistent with the statements contained herein, and any such representations, if made, may not be relied upon as having been so authorised.

Copies of this Announcement and any formal documentation relating to the Acquisition are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send them in or into or from any Restricted Jurisdiction.

Any failure to comply with the applicable restrictions may constitute a violation of the securities laws of any such jurisdiction and, to the fullest extent permitted by applicable law, Fortune Oil and Fortune Dynasty disclaim any responsibility or liability for the violation of such restrictions by any person.

No person should construe the contents of this Announcement as legal, financial or tax advice and any interested person should consult its own advisers in connection with such matters.

Notice to US investors

The Acquisition relates to the shares of an English company that is not registered under the Exchange Act and is being made by means of a scheme of arrangement provided for under English company law.  A transaction effected by means of a scheme of arrangement is not subject to the tender offer rules or the proxy solicitation rules under the Exchange Act.  Accordingly, the Acquisition is subject to the disclosure requirements and practices applicable in the United Kingdom to schemes of arrangement which differ from the disclosure requirements in the United States tender offer and proxy solicitation rules under the Exchange Act. Financial information included (or incorporated by reference) in this Announcement and the Scheme Document in relation to Fortune Oil has been or will have been prepared in accordance with accounting standards applicable in the United Kingdom that may not be comparable to financial information of US companies or companies whose financial statements are prepared in accordance with generally accepted accounting principles in the United States.  It may be difficult for US holders of Fortune Oil Shares to enforce their rights and any claim arising out of US federal laws, since Fortune Oil, Fortune Dynasty and most of the Consortium are located in a non-US jurisdiction and some or all of their officers and directors may be resident in a non-US jurisdiction.  US holders of Fortune Oil Shares may not be able to sue a non-US company or its officers or directors in a non-US court for violations of the US securities laws.  Further, it may be difficult to compel a non-US company and its affiliates to subject themselves to a US court's judgement.  If Fortune Dynasty exercises its right to implement the Acquisition by way of an Offer, such offer will be made in compliance with applicable US laws and regulations. 

No registration statement will be filed with the SEC or any state securities regulators in the US in connection with the Acquisition, and the Loan Notes to be issued pursuant to the terms of the Class I CVRs will not be registered under the US Securities Act.

Neither the SEC, nor any US state securities commission or any other regulatory authority, has passed upon, or endorsed the merits of, or approved or disapproved of the Loan Notes to be issued in connection with the Acquisition, or determined if this Announcement is accurate or adequate. Any representation to the contrary is a criminal offence in the US.

Fortune Dynasty Financial adviser

Standard Chartered Bank, who is (i) authorised in the United Kingdom by the Prudential Regulation Authority, and (ii) regulated in the United Kingdom by the Financial Conduct Authority and the Prudential Regulation Authority, is acting for Fortune Dynasty and for no one else in connection with the matters set out in this Announcement and the Acquisition and will not be responsible to anyone other than Fortune Dynasty for providing the protections afforded to clients of Standard Chartered Bank nor for providing advice in relation to the Acquisition or any matters set out in this Announcement. Neither Standard Chartered Bank nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Standard Chartered Bank in connection with this Announcement, any statement contained herein or otherwise.

Fortune Oil Financial adviser

VSA Capital Limited, who is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively as financial adviser to the Independent Fortune Oil Directors and no one else in connection with the matters set out in this Announcement and the Acquisition and will not be responsible to anyone other than Independent Fortune Oil Directors for providing the protections afforded to clients of VSA Capital Limited nor for providing advice in relation to the Acquisition or any matters set out in this Announcement. Neither VSA Capital Limited nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of VSA Capital Limited in connection with the Acquisition.

Forward Looking Statements

This Announcement contains certain forward-looking statements with respect to the financial condition, results of operations and business of Fortune Oil and certain plans and objectives of Fortune Dynasty with respect thereto.  These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts.  Forward-looking statements often use words such as 'anticipate', 'target', 'expect', 'estimate', 'intend', 'plan', 'goal', 'believe', 'hope', 'aims', 'continue', 'will', 'may', 'should', 'would', 'could' or other words of similar meaning.  These statements are based on assumptions and assessments made by Fortune Oil and/or Fortune Dynasty in light of their experience and their perception of historical trends, current conditions, future developments and other factors they believe appropriate.  By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future.  The factors described in the context of such forward-looking statements in this Announcement could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements.  Although it is believed that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct and persons reading this Announcement are therefore cautioned not to place undue reliance on these forward-looking statements which speak only as at the date of this Announcement.  Neither Fortune Oil nor Fortune Dynasty assumes any obligation to update or correct the information contained in this Announcement (whether as a result of new information, future events or otherwise), except as required by applicable law. 

There are several factors which could cause actual results to differ materially from those expressed or implied in forward-looking statements.  Among such factors are changes in the global, political, economic, business, competitive, market and regulatory forces, future exchange and interest rates, changes in tax rates and future business combinations or disposals.

No profit forecasts or estimates

No statement in this Announcement is intended as a profit forecast or estimate for any period and no statement in this Announcement should be interpreted to mean that earnings or earnings per ordinary share for Fortune Oil for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per ordinary share for Fortune Oil.

Disclosure requirements of the Takeover Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 p.m. on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Takeover Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Right to switch to an Offer

Fortune Dynasty reserves the right to elect (with the consent of the Takeover Panel) to implement the Acquisition by way of an Offer for the entire issued and to be issued ordinary share capital of Fortune Oil as an alternative to the Scheme.  In such an event, the Offer will be implemented on the same terms (subject to appropriate amendments), so far as applicable, as those which would apply to the Scheme and subject to the amendment referred to in Appendix I to this Announcement.

Publication on Website

In accordance with Rule 26.1 of the Takeover Code, a copy of this Announcement will be made available (subject to certain restrictions relating to persons resident in Restricted Jurisdictions), free of charge, at www.fortune-oil.com and www.fdynasty.com by no later than 12 noon on 19 December 2014.

Neither the content of the websites nor the content of any other website accessible from hyperlinks on such websites is incorporated into, or forms part of, this Announcement.

Not for release, publication or distribution, in whole or in part, in or into or from any restricted jurisdictions or any other JURISDICTION where to do so would constitute a violation of the relevant laws of such jurisdiction

18 December 2014

Recommended Acquisition

of

FORTUNE OIL PLC

resulting in the holding by

FORTUNE DYNASTY HOLDINGS LIMITED

(a company that is owned by (i) a member of the

Vitol Group and (ii) First Level Holdings Limited)

of the entire issued and to be issued ordinary share capital of

Fortune Oil not already held by the Consortium

to be effected by a scheme of arrangement

under Part 26 of the Companies Act 2006

1.         Introduction

The Fortune Dynasty Board and the Independent Fortune Oil Directors are pleased to announce that they have reached agreement on the terms of a unanimously recommended acquisition to be made by Fortune Dynasty for the entire issued and to be issued ordinary share capital of Fortune Oil that is not already owned by the Consortium.  The Consortium currently holds, directly or indirectly, 1,472,383,697 Fortune Oil Shares, representing approximately 56.91 per cent. of the issued ordinary share capital of Fortune Oil. It is anticipated that the Acquisition will be implemented by way of a Court-sanctioned scheme of arrangement of Fortune Oil under Part 26 of the Act. The Conditions to and further terms of the Acquisition are set out in full in Appendix I to this Announcement.

2.         Summary of the terms of the Acquisition

The Acquisition will be on the terms and subject to the Conditions set out in Appendix I to this Announcement and to be set out in the Scheme Document. 

Under the terms of the Acquisition, if the Scheme becomes Effective those holders of Scheme Shares on the register of members of Fortune Oil at the Scheme Record Time will receive:

(Note: Restricted Overseas Shareholders will not be entitled to receive a CVR due to applicable securities laws restrictions)

The Acquisition, excluding the CVRs, values the entire issued and to be issued share capital of Fortune Oil at approximately £259 million.

The Acquisition, including the CVRs, values the entire issued and to be issued share capital of Fortune Oil at approximately £388 million.

             The Acquisition represents an immediate cash premium, excluding the CVRs, of approximately:

·           58.5 per cent. over the Closing Price of 6.31 pence per Fortune Oil Share on 17 December 2014, being the last practicable date before this Announcement;

·           42.0 per cent. over the average Closing Price per Fortune Oil Share for the one (1) month period immediately preceding 17 December 2014, being the last practicable day before the date of this Announcement; and

·           29.6 per cent. over the average Closing Price per Fortune Oil Share for the three (3) months immediately preceding 17 December 2014, being the last practicable day before the date of this Announcement.

The Scheme Shares will be acquired by Fortune Dynasty fully paid and free from all liens, equitable interests, charges, encumbrances, rights of pre-emption and any other third party rights or interests whatsoever and together with all rights existing at the date of this Announcement or thereafter attaching thereto, including (without limitation) the right to receive and retain, in full, all dividends and other distributions (if any) declared, made or paid or any other return of capital (whether by way of reduction of share capital or share premium account or otherwise) made on or after the date of this Announcement in respect of the Scheme Shares.

If any dividend or other distribution in respect of the Scheme Shares is declared, paid or made on or after the date of this Announcement, Fortune Dynasty reserves the right to reduce the consideration payable for each Scheme Share under the terms of the Acquisition by the amount per Scheme Share of such dividend or distribution.

3.         CVRs and Loan Notes

3.1        CVRs

Pursuant to the terms of the Acquisition, Scheme Shareholders (other than Restricted Overseas Shareholders) will receive one CVR for each Scheme Share that they hold. The CVRs are intended to enable Scheme Shareholders (other than Restricted Overseas Shareholders) to share in the proceeds of a sale by the Fortune Oil Group and China Gas Group of a material proportion of their current holding of China Gas Holdings Shares in the 12 month period following the Effective Date, if certain conditions and thresholds are met.

Each CVR will provide Scheme Shareholders (other than Restricted Overseas Shareholders) with a contingent right to receive 5 pence in either cash (the CVR Cash Amount) (subject to any applicable deductions or withholdings) or, if they so elect, Loan Note(s) (subject to applicable securities laws) (the CVR Consideration), in each case subject to and in accordance with the terms and conditions of the CVR Deed Poll.

The CVR Consideration will be paid or issued (as the case may be) to CVR Holders, subject to the terms of the CVR Deed Poll, if both of the following conditions are satisfied prior to the expiry of the 12 month period following the Effective Date (such period the CVR Term):

(a)        the Fortune Oil Group and China Gas Group shall, during the CVR Term, have sold to a CVR Third Party, solely for cash, an aggregate number of the China Gas Holdings Shares exceeding 199,385,362 China Gas Holdings Shares (representing in excess of 35 per cent. of all of the Fortune Oil Group's direct and indirect interests in the China Gas Holdings Shares at the date of this Announcement); and

(b)        the volume-weighted average per share price of all China Gas Holdings Shares sold by the Fortune Oil Group and China Gas Group to a CVR Third Party, solely for cash, during the CVR Term shall be in excess of HK$11.

The CVRs will be an obligation of Fortune Dynasty pursuant to the CVR Deed Poll. 

Scheme Shareholders (other than Restricted Overseas Shareholders) will be entitled to make an election to receive Class I CVRs. Each Class I CVR will entitle the Class I CVR Holder to receive Loan Note(s) (subject to applicable securities laws), in an amount equal to the CVR Cash Amount, the principal of which will be redeemable in cash on the redemption date. Each Class II CVR will entitle the Class II CVR Holder to receive further cash, in an amount equal to the CVR Cash Amount.

The CVRs will be non-transferable other than to certain permitted transferees and no application will be made for the CVRs to be listed or dealt in on any stock exchange.  The CVRs will be governed by English law and will not be represented by any certificate or other evidence of title.  No interest is payable in respect of the CVRs. 

The Loan Notes will not be issued to US Persons or persons located in the United States. Accordingly, such US investors will only have the option to take Class II CVRs. 

Under the laws of Hong Kong it is an offence to issue an invitation to acquire CVRs absent authorisation by the Securities and Futures Commission of Hong Kong or the invitation falling within an exemption in the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong), including the exemption for invitations to "professional investors" as defined in that Ordinance.  Accordingly, Restricted Overseas Shareholders with registered addresses in Hong Kong are not entitled to the CVRs unless Fortune Dynasty is able to establish to its satisfaction that they are such "professional investors". If  the  laws  of  any  other relevant  jurisdiction  make  it  illegal  for  Scheme Shareholders to hold or be issued CVRs or would require any qualification of the CVRs under any applicable laws or regulations, they may not be entitled to the CVRs or the amounts which may be payable thereon. 

The CVRs are complex instruments and a number of factors will determine whether any amount will actually be paid to Scheme Shareholders by way of the CVRs. The minimum payment under the CVRs could be zero. Further details in respect of the CVRs will be contained in the Scheme Document.

3.2        Loan Notes

The Loan Notes will be governed by English law and will be issued, credited as fully paid, in integral multiples of 5 pence nominal value. The Loan Notes will be non-transferable other than to certain permitted transferees and no application will be made for them to be listed or dealt in on any stock exchange. For holders subject to UK capital gains tax, the Loan Notes are not expected to be qualifying corporate bonds.

The Loan Notes will not bear interest.

The Loan Notes will be issued in accordance with the terms of the Class I CVRs. The term of the Loan Notes will be six months and one day from the date of issue of the Loan Notes. On the expiry of the term, Fortune Dynasty will redeem the outstanding Loan Notes for cash at par (less any tax required by law to be withheld or deducted therefrom). A holder of the Loan Notes may not opt to redeem any of his notes prior to the expiry of the term.

Full details of the Loan Notes will be contained in the Scheme Document.

Fortune Oil Shareholders should consider carefully, in light of their own investment objectives and tax position, whether they wish to elect for Class I CVRs which will entitle the Class I CVR Holder to receive Loan Notes and are strongly advised to seek their own independent financial advice before making any such election.

4.         Background to and reasons for the Acquisition

Developments involving Fortune Oil in recent years have resulted in a divergence of interests among Fortune Oil Shareholders, and reduced its suitability as a listed company.  In particular:

(a)        as Fortune Oil is now primarily an investment holding company and generates its cash inflows principally from dividends from its minority equity holdings, rather than operations, it no longer requires access to equity capital markets to sustain and grow its business.  As such, there is no longer a requirement to remain listed on a public market;

(b)        there has been a continuing downward trend in the liquidity of the Fortune Oil Shares over the past two years, which, in addition to the reduced free-float following the disposal of the gas business in October 2013, will continue to make it difficult for Fortune Oil to attract new institutional investors;

(c)        following the disposal of its natural gas business in October 2013, Fortune Oil has become a vehicle for a number of investments, none of which are operated or controlled by Fortune Oil;

(d)        since Fortune Oil's move from a premium to a standard listing on the Main Market of the London Stock Exchange in March 2013, it has become a less suitable investment opportunity for many of its institutional investor shareholders; and

(e)        the nature of Fortune Oil's holding of China Gas Holdings Shares is such that the ability to deal with its China Gas Holdings Shares is restricted and such dealings are only permitted in a limited number of circumstances and, in respect of a number of such shares, are subject to the consent of a third party.  Fortune Oil's ability to realise value in the China Gas Holdings Shares it holds is therefore constrained.  In addition, the net realisable value of the China Gas Holdings Shares held indirectly by Fortune Oil is materially impacted by the level of debt in China Gas Group.  

The Independent Fortune Oil Directors believe there would be a challenging investment environment ahead for Fortune Oil Shareholders, should the Scheme not become Effective and Fortune Oil remain listed.

5.         Recommendation

The Independent Fortune Oil Directors, who have been so advised by VSA Capital, consider the terms of the Acquisition to be fair and reasonable. In providing advice to the Independent Fortune Oil Directors, VSA Capital has taken into account the commercial assessments of the Independent Fortune Oil Directors. The Takeover Panel has consented to the exclusion of Daniel Chiu, Dennis Chiu, Ian Taylor, Louisa Ho and Li Ching from these matters on the basis that they are both Fortune Oil Directors and members of the Concert Party and Wang JinJun on the basis of his close association with certain members of the Concert Party.

Accordingly, the Independent Fortune Oil Directors unanimously recommend that the Scheme Shareholders vote in favour of the Scheme at the Court Meeting and that the Fortune Oil Shareholders vote in favour of the resolutions relating to the Acquisition (including the Capital Reduction) at the General Meeting (or in the event that the Acquisition is implemented by way of an Offer, to accept or procure acceptance of such Offer), as the Independent Fortune Oil Directors who hold Fortune Oil Shares have irrevocably undertaken to do in respect of their own beneficial holdings referred to below.

6.         Background to and reasons for the recommendation

Over the past 20 years, despite progress at Fortune Oil, Fortune Oil's share price performance has been disappointing, with considerable share price fluctuations.  While the disposal of the gas business in October 2013 resulted in a reduced free-float in the Fortune Oil Shares, it was expected that there would have been additional sources of demand for, and hence improved marketability of, the Fortune Oil Shares. This has not been the case. In the period following the disposal of the gas business, the average daily volume traded in Fortune Oil Shares has continued to decline. This indicates that Fortune Oil has become more illiquid in the months following the disposal of the gas business and has, therefore, become less marketable.

Following the disposal of the gas business, Fortune Oil has become primarily an investment holding company and generates its cash inflows principally from dividends from its minority equity holdings, rather than operations.  Fortune Oil does not control its investee companies.  Fortune Oil is vulnerable to the variability in performance of the companies it is invested in.  The Independent Fortune Oil Directors believe that the terms of the Acquisition meet the divergent interests of Fortune Oil Shareholders, allowing both institutional and individual shareholders to realise value for their investment in Fortune Oil.

Given the nature of Fortune Oil's business, the Independent Fortune Oil Directors believe that the next phase of Fortune Oil's development can be most effectively undertaken as a private, unlisted entity. The added costs associated with maintaining a listing are no longer justified given the lack of need for further capital.

The Independent Fortune Oil Directors are mindful of the possibility that Fortune Oil's holding of China Gas Holdings Shares may be sold by the Fortune Oil Group following the completion of the Acquisition.  Accordingly, the Independent Fortune Oil Directors have secured an arrangement whereby, pursuant to the terms of the Acquisition, Scheme Shareholders (other than Restricted Overseas Shareholders) will receive (in addition to 10 pence in cash for each Scheme Share) one CVR for each Scheme Share that they hold. The CVRs are intended to enable Scheme Shareholders to share in the proceeds of a sale by the Fortune Oil Group and China Gas Group of a material proportion of their current holding of China Gas Holdings Shares if certain conditions and thresholds are met. 

7.         Irrevocable Undertakings

Fortune Dynasty has received irrevocable undertakings to vote in favour of the Scheme at the Court Meeting and the Resolutions relating to the Acquisition (including the Capital Reduction) at the General Meeting (or in the event that the Acquisition is implemented by way of an Offer, to accept the Offer) from Frank Attwood and Tian Jun (the only Independent Directors who hold Fortune Oil Shares) in respect of their own beneficial holdings of Fortune Oil Shares amounting, in aggregate, to 3,693,220 Fortune Oil Shares, representing approximately 0.14 per cent. of the issued ordinary share capital of Fortune Oil and 0.33 per cent. of the Scheme Shares held by the Scheme Shareholders entitled to vote at the Court Meeting, in each case at 17 December 2014 (being the last practicable day before the date of this Announcement). 

Further details of these Irrevocable Undertakings are set out in Appendix II to this Announcement.

8.         Information on the Consortium

In aggregate, the Consortium holds, directly or indirectly, 1,472,383,697 Fortune Oil Shares, representing approximately 56.91 per cent. of the issued ordinary share capital of Fortune Oil.

8.1        Fortune Dynasty

Fortune Dynasty is a limited liability company incorporated in the British Virgin Islands that is owned (i) 55 per cent. by First Level and (ii) 45 per cent. by Vitol Bermuda. As part of a reorganisation agreed by the Consortium in connection with the Acquisition (but outside of the Scheme), it is intended that Fortune Dynasty will acquire the interests in Fortune Oil held by Vitol Group and First Level (as described below) such that Fortune Dynasty would ultimately be owned (i) 70 per cent. by First Level and (ii) 30 per cent. by Vitol Bermuda.

Fortune Dynasty currently holds 599,639,580 shares in Fortune Oil representing approximately 23.18 per cent. of the issued ordinary share capital of Fortune Oil as at 17 December 2014, being the last practicable day before the date of this Announcement.

Fortune Dynasty is a holding company whose sole purpose is to hold Fortune Oil Shares.  It acquired its interest in Fortune Oil in October 2013.

8.2        Vitol Group

Vitol Bermuda is a limited liability company incorporated in Bermuda that is a member of the Vitol Group.

The Vitol Group (via Vitol Bermuda) currently directly holds 147,108,505 Fortune Oil Shares representing approximately 5.69 per cent. of the issued ordinary share capital of Fortune Oil (other than the Fortune Oil Shares held indirectly by virtue of Vitol's ownership interest in Fortune Dynasty) as at 17 December 2014, being the last practicable day before the date of this Announcement.

Vitol Bermuda first acquired an interest in Fortune Oil in 1993.

The Vitol Group is one of the world's largest independent energy trading companies. The Vitol Group's core business is in energy, particularly crude oil and oil products. 

8.3        First Level

First Level is a limited liability company incorporated in the Cayman Islands that is owned (i) 99 per cent. by Daniel Chiu and (ii) 1 per cent. by Dennis Chiu (being Daniel Chiu's brother), both Daniel Chiu and Dennis Chiu being Fortune Oil Directors (as more particularly described below).

First Level currently holds, directly and indirectly, 725,635,612 Fortune Oil Shares representing approximately 28.05 per cent. of the issued ordinary share capital of Fortune Oil (other than the Fortune Oil Shares held indirectly by virtue of First Level's ownership interest in Fortune Dynasty) as at 17 December 2014, being the last practicable day before the date of this Announcement.

First Level is a private investment vehicle for Daniel Chiu and its primary purpose is to hold, directly or indirectly, Fortune Oil Shares.

Daniel Chiu has been Fortune Oil's Executive Vice-Chairman since October 1994 and a Fortune Oil Director since 9 August 1993.  Mr Chiu was previously Fortune Oil's Chief Executive Officer prior to holding his current position as Executive Vice-Chairman. Dennis Chiu has been a non-executive director of Fortune Oil since 9 August 1993.

8.4        Concert Parties

The following persons are deemed to be acting in concert with the Consortium:

(a)        Daniel Chiu

Daniel Chiu owns 99 per cent. of First Level, is the Executive Vice-Chairman and an executive director of Fortune Oil and is the brother of Dennis Chiu.

(b)        Li Ching

Li Ching is an executive director of Fortune Oil and is considered to be acting in concert with the Consortium by virtue of being an employee or director of other companies controlled by Daniel Chiu.

(c)        Louisa Ho

Louisa Ho is a non-executive director of Fortune Oil and is considered to be acting in concert with the Consortium by virtue of being an employee or director of other companies controlled by Daniel Chiu.

(d)        Dennis Chiu

Dennis Chiu is the brother of Daniel Chiu, a non-executive director of Fortune Oil and he owns 1 per cent. of First Level.

(e)        Ian Taylor

Ian Taylor is the President and Chief Executive Officer of the Vitol Group.

9.         Financing the Acquisition

9.1        Financing

The cash consideration payable under the terms of the Acquisition (together with costs and expenses payable in connection with the Acquisition) will be funded by the proceeds of the Vitol Offer Facility Agreement.  In addition, the proceeds of the Vitol Offer Facility Agreement may, among other things, be used to refinance certain existing financial indebtedness of the Fortune Oil Group (and to pay associated costs and expenses).

Standard Chartered Bank, as financial adviser to Fortune Dynasty, is satisfied that sufficient financial resources are available to Fortune Dynasty to enable it to satisfy in full the immediate cash consideration payable to Fortune Oil Shareholders under the terms of the Acquisition.

Standard Chartered Bank has not  been  required  to  confirm,  and  has  not confirmed, that resources are available to Fortune Dynasty to satisfy payments under the CVRs or the Loan Notes and shareholders will be at risk if, for any reason, Fortune Dynasty is not in a position to meet its obligations in respect of the CVRs and/or Loan Notes.

9.2        Security

In connection with the Vitol Offer Facility Agreement, and pursuant to the Security Documents, Fortune Dynasty has granted security in favour of the Vitol Lender over all of the Fortune Oil Shares that it owns in Fortune Oil from time to time and First Level has granted security over all of the shares in Fortune Dynasty that it owns from time to time.

9.3        Amendment and waiver of Conditions

Under the Vitol Offer Facility Agreement, Fortune Dynasty has agreed that it will not, without the consent of the Vitol Lender:

(a)        waive or amend any other term or condition of the Acquisition in any material respect where such waiver or amendment could reasonably be expected to materially and adversely affect the interests of the Vitol Lender under the Vitol Offer Facility Agreement (unless such action is required by the Takeover Code or the Takeover Panel); or

(b)        declare, accept or treat as satisfied any material condition to the Acquisition where it is not actually satisfied or has not been complied with, in each case where to do so could reasonably be expected to materially and adversely affect the interests of the Vitol Lender under the Vitol Offer Facility Agreement (unless such action is required by the Takeover Code or the Takeover Panel).

10.        Information on Fortune Oil

Fortune Oil is a limited liability company incorporated in England.  Fortune Oil's shares were admitted to the Official List and main market of the London Stock Exchange on 10 August 1993.  On 20 March 2013, Fortune Oil transferred its listing category on the London Stock Exchange from a "premium listing (commercial company)" to a "standard listing".

Fortune Oil is the ultimate holding company of a group of companies whose principal activities focus on oil, natural gas and resource supply, operations and investments in China. Fortune Oil also trades in oil and petrochemical products, liquid petroleum gas and liquefied natural gas. Fortune Oil's functional headquarters are in Hong Kong.

11.        Fortune Oil Share Schemes

The Acquisition will extend to any Fortune Oil Shares unconditionally allotted or issued and fully paid on or prior to the Scheme Record Time (i) pursuant to the exercise of options under any of the Fortune Oil Share Schemes or (ii) as a result of the vesting of awards pursuant to the Fortune Oil Share Schemes. To the extent that such options or awards have not been exercised or vested, participants in the Fortune Oil Share Schemes will be written to separately and appropriate proposals will be made to such participants in due course. 

In the event that this Acquisition is to be implemented by way of an Offer, proposals will be put to the holders of options under the Fortune Oil Share Schemes to enable them to participate in the Offer on an equivalent basis in the event that such Offer becomes wholly unconditional.

12.        Fortune Dynasty's intentions for Fortune Oil's management and employees

Fortune Dynasty confirms that, if the Acquisition becomes Effective the existing contractual rights of Fortune Oil's management and employees will be observed.

13.        Structure of the Acquisition

13.1      Scheme

It is intended that the Acquisition will be effected by a Court-sanctioned scheme of arrangement between Fortune Oil and the Scheme Shareholders under Part 26 of the Act, and will involve, among other things, a reduction of capital under section 641 of the Act.  The purpose of the Scheme is to provide for Fortune Dynasty to become the owner of the whole of the issued and to be issued share capital of Fortune Oil, other than the Shares already held by the Consortium.  Under the Scheme, the Acquisition is to be principally achieved by:

(a)        the cancellation or transfer (as the case may be) of the Scheme Shares held by Scheme Shareholders in consideration for which the Scheme Shareholders will receive consideration on the basis set out in paragraph 2 of this Announcement;

(b)        amendments to Fortune Oil's articles of association to ensure that any Fortune Oil Shares issued (other than the New Fortune Oil Shares to be issued to Fortune Dynasty or any subsidiaries or nominees of Fortune Dynasty) between the approval of the Scheme at the Court Meeting and the Scheme Record Time (for example as a result of the exercise of options or vesting of awards granted under the Fortune Oil Share Schemes) will (i) be subject to the Scheme and (ii) automatically be acquired by Fortune Dynasty; and

(c)        the issue of New Fortune Oil Shares to Fortune Dynasty provided for in the Scheme.

Approval by Court Meeting and General Meeting

In order to become Effective, the Scheme requires:

(a)        the satisfaction (or, where applicable, waiver) of the Conditions (see paragraph 13.2 of this Announcement);

(b)        the approval of a majority in number of the Scheme Shareholders present and voting at the Court Meeting either in person or by proxy, representing not less than 75 per cent. in value of the Scheme Shares voted by those Scheme Shareholders.  At the Court Meeting, voting will be by poll and not on a show of hands and each Scheme Shareholder present in person or by proxy will be entitled to one vote for each Scheme Share held; and

(c)        the approval of the Resolutions relating to the Acquisition (including the Capital Reduction)  by not less than 75 per cent. of the votes cast, either in person or by proxy, at the General Meeting (to be held directly after the Court Meeting).

Application to Court to sanction the Scheme and confirmation of the Capital Reduction

Once the approval of the Scheme Shareholders to the Scheme has been obtained at the Court Meeting and the approval of the Fortune Oil Shareholders has been obtained to the Resolutions relating to the Acquisition (including the Capital Reduction) at the General Meeting, the Scheme (including, confirmation of the Capital Reduction) must be sanctioned by the Court at the Court Hearings.

The Scheme will become Effective in accordance with its terms on delivery of the Scheme Court Order, the Reduction Court Order and the Statement of Capital giving details of Fortune Oil's share capital, as altered by the Capital Reduction, attached thereto to Companies House, and, in relation to the Capital Reduction, the Reduction Court Order and attached minutes being filed with and registered by Companies House.  Upon the Scheme becoming Effective, it will be binding on all Scheme Shareholders, irrespective of whether or not they attended or voted at the Court Meeting or General Meeting, or whether they voted in favour of or against the Scheme and the cash consideration due under the Acquisition will be despatched by Fortune Dynasty to Scheme Shareholders no later than 14 days after the Effective Date. 

Full details of the Scheme to be set out in the Scheme Document

The Scheme is subject to the satisfaction (or, where applicable, waiver) of the Conditions and the full terms and conditions to be set out in the Scheme Document.  The Scheme Document will include full details of the Scheme, together with notices of the Court Meetings and the General Meeting and the expected timetable, and will specify the action to be taken by Scheme Shareholders.

The Scheme will be governed by English law.  The Scheme will be subject to the applicable requirements of the Takeover Code, the Takeover Panel, the London Stock Exchange, the FCA and the Listing Rules. 

The Scheme will contain a provision for Fortune Oil and Fortune Dynasty to jointly consent, on behalf of all persons concerned, to any modification of or addition to the Scheme or to any condition that the Court may approve or impose.  Fortune Oil has been advised that the Court would be unlikely to approve any modification of, or addition to, or impose a condition to the Scheme which might be material to the interests of the Scheme Shareholders unless the Scheme Shareholders were informed of such modification, addition or condition.  It would be a matter for the Court to decide, in its discretion, whether or not a further meeting of the Scheme Shareholders should be held in these circumstances.

It is expected that the Scheme Document will be dispatched to Fortune Oil Shareholders  and, for information only, to participants in the Fortune Oil Share Schemes as soon as practicable and, in any event, shortly following 14 January 2015. 

13.2      Conditions to the Acquisition

The Conditions to the Acquisition are set out in full in Appendix I to this Announcement. 

The Scheme is conditional, among other things, upon:

(a)        the Scheme becoming Effective by the Long Stop Date or such later date as Fortune Dynasty and Fortune Oil may, with the consent of the Takeover Panel, agree and (if required) the Court may approve, failing which the Scheme will lapse;

(b)        the approval of the Scheme by a majority in number of the Scheme Shareholders voting, either in person or by proxy, at the Court Meeting, representing not less than 75 per cent. in value of the Scheme Shares voted;

(c)        the passing of all Resolutions relating to the Acquisition (including the Capital Reduction) by the requisite majority at the General Meeting; and

(d)        the sanction of the Scheme and subsequent confirmation of the Capital Reduction by the Court (in either case, with or without modification on terms agreed by Fortune Dynasty and Fortune Oil) and the delivery of office copies of the Court Orders and the Statement of Capital to Companies House and, if the Court so orders for the Scheme to become Effective, registration of the Reduction Court Order confirming the Capital Reduction and Statement of Capital with Companies House.

13.3      Scheme timetable/further information

A full anticipated timetable will be set out in the Scheme Document.   At this stage, subject to the approval and availability of the Court (which is subject to change), Fortune Dynasty's expected timetable for the implementation of the Acquisition is as follows:

If the Acquisition does not become Effective by the Long Stop Date, the Acquisition will lapse except where the approval of Scheme Shareholders at the Court Meeting and the Fortune Oil Shareholders at the General Meeting is obtained before this date, in which case the Long Stop Date for the Acquisition may be extended to such later date as Fortune Oil and Fortune Dynasty may agree and, if appropriate, the Court and the Takeover Panel may approve.

13.4      Right to switch to an Offer

Fortune Dynasty reserves the right to elect (with the consent of the Takeover Panel) to implement the Acquisition by way of an Offer for the entire issued and to be issued ordinary share capital of Fortune Oil as an alternative to the Scheme.  In such an event, the Offer will be implemented on the same terms (subject to appropriate amendments), so far as applicable, as those which would apply to the Scheme and subject to the amendment referred to in paragraph 4 of Part B of Appendix I to this Announcement.

If the Acquisition is effected by way of an Offer and such Offer becomes or is declared unconditional in all respects and sufficient acceptances are received, Fortune Dynasty intends to: (i) request the London Stock Exchange to cancel trading in Fortune Oil Shares on the main market of the London Stock Exchange; and (ii) exercise its rights to apply the provisions of Chapter 3 of Part 28 of the Act to acquire compulsorily the remaining Fortune Oil Shares in respect of which the Offer has not been accepted.

14.        De-listing and re-registration as a private limited company

14.1      De-listing

Prior to the Scheme becoming Effective and subject to any applicable requirements of the Takeover Code, Fortune Oil intends to make an application to the London Stock Exchange for cancellation of the trading in Fortune Oil Shares on the London Stock Exchange, and to the UK Listing Authority for the cancellation of the listing of Fortune Oil Shares on the Official List, in each case to take effect on or shortly after the Effective Date. It is intended that dealings in Fortune Oil Shares shall be suspended at close of business in London on 2 March 2015 and that no transfers of Fortune Oil Shares (other than to Fortune Dynasty and/or its nominee(s)) will be registered after that time.

As at the close of trading on the last day of dealings in Fortune Oil Shares prior to the Effective Date, there may be unsettled, open trades for the sale and purchase of Fortune Oil Shares within the CREST system. The Fortune Oil Shares that are the subject of such unsettled trades will be treated under the Scheme in the same way as any other Fortune Oil Share registered in the name of the relevant seller under that trade. Consequently, those Fortune Oil Shares will be cancelled under the Scheme and the seller will receive the cash consideration in accordance with the terms of the Scheme.  No transfers of Fortune Oil Shares will be registered after this date and, other than the registration of Fortune Oil Shares released, transferred or issued under the Fortune Oil Share Schemes after the Scheme Court Hearing and prior to the Scheme Record Time, no Fortune Oil Shares will be issued after this date, save for the New Fortune Oil Shares to be issued to Fortune Dynasty pursuant to the Scheme. 

On the Effective Date, each certificate representing a holding of Fortune Oil Shares subject to the Scheme will be cancelled. Share certificates in respect of Fortune Oil Shares will cease to be valid and every Fortune Oil Shareholder will be bound at the request of Fortune Oil to deliver up to Fortune Oil, or to any person appointed by Fortune Oil, the share certificate(s) for cancellation, or to destroy them. As from the Scheme Record Time, each holding of Scheme Shares credited to any stock account in CREST will be disabled and all Scheme Shares will be removed from CREST in due course.

14.2      Re-registration as a private limited company

It is also intended that Fortune Oil be re-registered as a private limited company as soon as practicable after the Effective Date.

15.        Acquisition related arrangements

15.1      Bid Conduct Agreement

Vitol Bermuda, First Level, Fortune Dynasty and Daniel Chiu entered into a bid conduct agreement on 15 December 2014 (the Bid Conduct Agreement). Pursuant to the Bid Conduct Agreement, the parties agree, among other matters: (i) not to deal in their Fortune Oil Shares in respect of certain manners; (ii) to extend their co-operation to each other in implementing the Acquisition, save to the extent that this would be inconsistent with their obligations under legal or regulatory requirements; and (iii) to implement the Acquisition in accordance with the Takeover Code.

15.2      Louisa Ho Undertaking

Louisa Ho entered into an undertaking on 15 December 2014 (the Louisa Ho Undertaking), pursuant to which Louisa Ho undertakes not to acquire or dispose of any interest in Fortune Oil Shares prior to the Effective Date other than pursuant to the Acquisition or as expressly permitted under the terms of the Louisa Ho Undertaking.

15.3      Dennis Chiu Undertaking

Dennis Chiu entered into an undertaking on 15 December 2014 (the Dennis Chiu Undertaking), pursuant to which Dennis Chiu undertakes not to acquire or dispose of any interest in Fortune Oil Shares prior to the Effective Date other than pursuant to the Acquisition or as expressly permitted under the terms of the Dennis Chiu Undertaking.

15.4      Li Ching Undertaking

Li Ching entered into an undertaking on 17 December 2014 (the Li Ching Undertaking), pursuant to which Li Ching undertakes, among other things, not to acquire or dispose of any interest in Fortune Oil Shares prior to the Effective Date other than pursuant to the Acquisition or as expressly permitted under the terms of the Li Ching Undertaking.

15.5      Confidentiality Agreement

Fortune Dynasty and Fortune Oil entered into the Confidentiality Agreement on 25 November 2014 along with a side letter to such agreement on 15 December 2014 pursuant to which each of Fortune Dynasty and Fortune Oil have agreed to keep confidential information about the other party and not to disclose to third parties (other than permitted recipients) confidential information exchanged by them unless required by law or regulation (the Confidentiality Agreement). These confidentiality obligations will remain in force until completion of the Acquisition or for a period of one year from the date that negotiations in respect of the Acquisition cease or are terminated.

16.        Disclosure of interests in Fortune Oil

16.1      Opening Position Disclosure

Fortune Dynasty confirms that it is making on the date of this Announcement an Opening Position Disclosure that shall set out the details required to be disclosed by it under Rule 8.1(a) of the Takeover Code. 

16.2      Interests

As at the close of business on 17 December 2014 (being the last practicable day prior to the date of this Announcement):

(a)        Fortune Dynasty holds 599,639,580 Fortune Oil Shares, representing approximately 23.18 per cent. of the issued ordinary share capital of Fortune Oil;

(b)        First Level holds, directly or indirectly, 725,635,612 Fortune Oil Shares, representing approximately 28.05 per cent. of the issued ordinary share capital of Fortune Oil (other than the Fortune Oil Shares held indirectly by virtue of First Level's ownership interest in Fortune Dynasty);

(c)        Vitol Group holds 147,108,505 Fortune Oil Shares, representing approximately 5.69 per cent. of the issued ordinary share capital of Fortune Oil (other than the Fortune Oil Shares held indirectly by virtue of Vitol's ownership interest in Fortune Dynasty);

(d)        Louisa Ho holds 2,884,156 Fortune Oil Shares, representing approximately 0.11 per cent. of the issued ordinary share capital of Fortune Oil; and

(e)        Li Ching holds 24,007,211 Fortune Oil Shares representing approximately 0.93 per cent. of the issued ordinary share capital of Fortune Oil and options/awards in respect of 1,267,526 Fortune Oil Shares, representing approximately 0.05 per cent. of the issued ordinary share capital of Fortune Oil,

(collectively, the Disclosed Interests).

Save for (i) the Disclosed Interests, (ii) in connection with the Vitol Offer Facility Agreement (including the Security Documents), and (iii) the Irrevocable Undertakings, none of (1) Fortune Dynasty or any of its directors, (2) the Consortium or any of its directors, or (3) so far as the board of Fortune Dynasty are aware, any person acting, or deemed to be acting, in concert with Fortune Dynasty:

(a)        had an interest in, or right to subscribe for, relevant securities of Fortune Oil;

(b)        had any short position in (whether conditional or absolute and whether in the money or otherwise), including any short position under a derivative, any agreement to sell or any delivery obligation or right to require another person to purchase or take delivery of, relevant securities of Fortune Oil;

(c)        had procured an irrevocable commitment or letter of intent to accept the terms of Acquisition in respect of relevant securities of Fortune Oil; or

(d)        had borrowed or lent any Fortune Oil Shares.

Furthermore, save for the Irrevocable Undertakings, no arrangement exists between (i) Fortune Dynasty or the Consortium or any of their respective associates and (ii) Fortune Oil, in relation to Fortune Oil Shares.  For these purposes, an "arrangement" includes any indemnity or option arrangement, any agreement or any understanding, formal or informal, of whatever nature, relating to Fortune Oil Shares which may be an inducement to deal or refrain from dealing in such securities.

16.3      Rule 2.10 Disclosure

In accordance with Rule 2.10 of the Takeover Code, Fortune Oil confirms that as at close of business on 17 December 2014, being the last practicable day before the date of this Announcement, it has in issue and admitted to trading on the main market of the London Stock Exchange 2,587,106,295 ordinary shares of 1 pence each.  The International Securities Identification Number (ISIN) of the Fortune Oil Shares is GB0001022960.

17.        Overseas shareholders

The distribution of this Announcement to, and the availability of the Acquisition to, persons who are not resident in the United Kingdom may be affected by the laws of their relevant jurisdiction. Such persons should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction. Fortune Oil Shareholders who are in any doubt regarding such matters should consult an appropriate independent professional adviser in the relevant jurisdiction without delay.

Further details in relation to overseas Fortune Oil Shareholders will be contained in the Scheme Document.

18.        Documents on website

A copy of the following documents will, by no later than 12 noon on 19 December 2014, be published on Fortune Oil's website at www.fortune-oil.com and Fortune Dynasty's website at www.fdynasty.com:

(a)        a copy of this Announcement;

(b)        the Vitol Financing Documents;

(c)        the Bid Conduct Agreement;

(d)        the Louisa Ho Undertaking;

(e)        the Dennis Chiu Undertaking;

(f)         the Li Ching Undertaking;

(g)        the Irrevocable Undertakings; and

(h)        the Confidentiality Agreement.

Neither the contents of the websites or any other websites accessible from hyperlinks on such websites are incorporated into, or form any part of, this Announcement.

Enquiries

Standard Chartered Bank:

(Financial Adviser to Fortune Dynasty)

David Harvey-Evers                                                                     Tel: +44 (0)207 885 9999

Fortune Oil:

Frank Attwood                                                                           Tel: +44 (0)207 096 9580

VSA Capital Limited:

(Financial Adviser to Fortune Oil)

Andrew Raca                                                                             Tel: +44 (0)203 005 5000

Justin McKeegan                                                                       Tel: +44 (0)203 005 5000

Important disclaimers (including in relation to securities law restrictions)

This Announcement is not intended to and does not constitute or form part of any offer to sell or subscribe for or any invitation to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Acquisition or otherwise.  The Acquisition will be made solely pursuant to the terms of the Scheme Document (or, if applicable, the Offer Document), which will contain the full terms and conditions of the Acquisition, including details of how to vote in respect of the Acquisition.  Any decision in respect of, or other response to, the Acquisition should be made only on the basis of the information contained in the Scheme Document (or, if applicable, the Offer Document).  

The release, publication or distribution of this Announcement in jurisdictions other than the United Kingdom may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves about, and observe any applicable requirements.  This Announcement has been prepared for the purpose of complying with English law and the Takeover Code and the information disclosed may not be the same as that which would have been disclosed if this Announcement had been prepared in accordance with the laws of jurisdictions outside the United Kingdom.

No person has been authorised to make any representations on behalf of Fortune Oil or Fortune Dynasty concerning the Scheme or the Acquisition which are inconsistent with the statements contained herein, and any such representations, if made, may not be relied upon as having been so authorised.

Copies of this Announcement and any formal documentation relating to the Acquisition are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send them in or into or from any Restricted Jurisdiction.

Any failure to comply with the applicable restrictions may constitute a violation of the securities laws of any such jurisdiction and, to the fullest extent permitted by applicable law, Fortune Oil and Fortune Dynasty disclaim any responsibility or liability for the violation of such restrictions by any person.

No person should construe the contents of this Announcement as legal, financial or tax advice and any interested person should consult its own advisers in connection with such matters.

Notice to US investors

The Acquisition relates to the shares of an English company that is not registered under the Exchange Act and is being made by means of a scheme of arrangement provided for under English company law.  A transaction effected by means of a scheme of arrangement is not subject to the tender offer rules or the proxy solicitation rules under the Exchange Act.  Accordingly, the Acquisition is subject to the disclosure requirements and practices applicable in the United Kingdom to schemes of arrangement which differ from the disclosure requirements in the United States tender offer and proxy solicitation rules under the Exchange Act.  Financial information included (or incorporated by reference) in this Announcement and the Scheme Document in relation to Fortune Oil has been or will have been prepared in accordance with accounting standards applicable in the United Kingdom that may not be comparable to financial information of US companies or companies whose financial statements are prepared in accordance with generally accepted accounting principles in the United States.  It may be difficult for US holders of Fortune Oil Shares to enforce their rights and any claim arising out of US federal laws, since Fortune Oil, Fortune Dynasty and most of the Consortium are located in a non-US jurisdiction and some or all of their officers and directors may be resident in a non-US jurisdiction.  US holders of Fortune Oil Shares may not be able to sue a non-US company or its officers or directors in a non-US court for violations of the US securities laws.  Further, it may be difficult to compel a non-US company and its affiliates to subject themselves to a US court's judgement.  If Fortune Dynasty exercises its right to implement the Acquisition by way of an Offer, such offer will be made in compliance with applicable US laws and regulations. 

No registration statement will be filed with the SEC or any state securities regulators in the US in connection with the Acquisition, and the Loan Notes to be issued pursuant to the terms of the Class I CVRs will not be registered under the US Securities Act.

Neither the SEC, nor any US state securities commission or any other regulatory authority, has passed upon, or endorsed the merits of, or approved or disapproved of the Loan Notes to be issued in connection with the Acquisition, or determined if this Announcement is accurate or adequate. Any representation to the contrary is a criminal offence in the US.

Fortune Dynasty Financial adviser

Standard Chartered Bank, who is (i) authorised in the United Kingdom by the Prudential Regulation Authority, and (ii) regulated in the United Kingdom by the Financial Conduct Authority and the Prudential Regulation Authority, is acting for Fortune Dynasty and for no one else in connection with the matters set out in this Announcement and the Acquisition and will not be responsible to anyone other than Fortune Dynasty for providing the protections afforded to clients of Standard Chartered Bank nor for providing advice in relation to the Acquisition or any matters set out in this Announcement. Neither Standard Chartered Bank nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Standard Chartered Bank in connection with this Announcement, any statement contained herein or otherwise.

Fortune Oil Financial adviser

VSA Capital Limited, who is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting exclusively as financial adviser to the Independent Fortune Oil Directors for Fortune Oil and for and no one else in connection with the matters set out in this Announcement and the Acquisition and will not be responsible to anyone other than Independent Fortune Oil Directors for providing the protections afforded to clients of VSA Capital Limited nor for providing advice in relation to the Acquisition or any matters set out in this Announcement. Neither VSA Capital Limited nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of VSA Capital Limited in connection with the Acquisition.

Forward Looking Statements

This Announcement contains certain forward-looking statements with respect to the financial condition, results of operations and business of Fortune Oil and certain plans and objectives of Fortune Dynasty with respect thereto.  These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts.  Forward-looking statements often use words such as 'anticipate', 'target', 'expect', 'estimate', 'intend', 'plan', 'goal', 'believe', 'hope', 'aims', 'continue', 'will', 'may', 'should', 'would', 'could' or other words of similar meaning.  These statements are based on assumptions and assessments made by Fortune Oil and/or Fortune Dynasty in light of their experience and their perception of historical trends, current conditions, future developments and other factors they believe appropriate.  By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future.  The factors described in the context of such forward-looking statements in this Announcement could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements.  Although it is believed that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct and persons reading this Announcement are therefore cautioned not to place undue reliance on these forward-looking statements which speak only as at the date of this Announcement.  Neither Fortune Oil nor Fortune Dynasty assumes any obligation to update or correct the information contained in this Announcement (whether as a result of new information, future events or otherwise), except as required by applicable law. 

There are several factors which could cause actual results to differ materially from those expressed or implied in forward-looking statements.  Among such factors are changes in the global, political, economic, business, competitive, market and regulatory forces, future exchange and interest rates, changes in tax rates and future business combinations or disposals.

No profit forecasts or estimates

No statement in this Announcement is intended as a profit forecast or estimate for any period and no statement in this Announcement should be interpreted to mean that earnings or earnings per ordinary share for Fortune Oil for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per ordinary share for Fortune Oil.

Disclosure requirements of the Takeover Code

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 p.m. on the 10th business day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Takeover Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Publication on Website

In accordance with Rule 26.1 of the Takeover Code, a copy of this Announcement will be made available (subject to certain restrictions relating to persons resident in Restricted Jurisdictions), free of charge, at www.fortune-oil.com and www.fdynasty.com by no later than 12 noon on 19 December 2014.

Neither the content of the websites nor the content of any other website accessible from hyperlinks on such websites is incorporated into, or forms part of, this Announcement.