Change to the general contract for the aerospace engineering project and Jiutai Ordos’ 500,000-ton ethylene glycol project

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Change to the General Contract for Aerospace Engineering’s 500,000-ton ethylene glycol project with Jutai Ordos Author/Source: Yaha Coal Chemical Industry Date: 2019-07-11 Views: 16 On July 4, Aerospace Engineering announced that, due to changes in the owner’s project plans, the company intended to modify the original General Contract with Jutai Energy (Ordos) Co., Ltd., adjust the scope of work, and sign a new agreement as the basis for execution. On July 7, 2018, Aerospace Changzheng Chemical Engineering Co., Ltd. (hereinafter referred to as Aerospace Engineering or the Company) held the 23rd meeting of its second board of directors, during which the resolution regarding the particularly significant contract for the Jiutai project was approved. On July 10, 2018, the Company signed a general contract for the construction of a project to produce 500,000 tons of ethylene glycol per year with Jiutai Energy (Ordos) Co., Ltd. (hereinafter referred to as Jiutai Energy or the Client) (hereinafter referred to as the ‘General Contract’). For more details, please refer to the announcement issued by the Company on the Shanghai Stock Exchange website on July 10, 2018, under announcement number 2018-015. On July 3, 2019, the company held the 10th meeting of its third board of directors, during which the resolution on \"Amending the particularly significant contract related to the Jiutai project\" was approved. Contract changes: 1. Since the signing of the aforementioned general contract, the owner has initiated several other large-scale construction projects simultaneously. The procurement and construction work related to the parts of the project that are not related to gasification units, as specified in the original general contract, have not yet begun. Through mutual consultation, it was decided to adjust the scope of work: Aerospace Engineering will be responsible for tasks such as patent licensing, engineering design, and the procurement of patented equipment within the scope of its core business, while the owner will handle the procurement and construction of units such as conversion units and low-temperature methanol washing units on its own. 2. The project pricing model has been changed from a fixed-price plus cost-plus model to a fixed-price model. The original general contract included a fixed-price component and a cost-plus fee component; the fixed-price contract amounted to 251 million yuan, while the cost-plus fee contract was estimated at 733.95 million yuan, for a total estimated amount of 984.95 million yuan. After both parties intend to amend the original General Contract, a new agreement to be signed under a fixed-price model will serve as the basis for performance, with the amount specified in the new agreement being 251 million yuan. 3. The new agreement consists of a Contract Agreement, a Patent License Agreement, an Engineering Design Contract, a Purchase Contract for Special Equipment Related to Aerospace Patents, and a Technical Service Contract; the total value of these contracts is 251 million yuan.