JOINT VENTURE CONTRACT

between

Zhangjiagang Chemical machinery co., ltd.

and

SES ASIA TECHNOLOGIES, LTD.

for the Establishment of

zcm -ses Sino-US Clean Energy tECHNOLOGIES CO., lTD.

14 FEBRUARY 2014

ZHANGJIAGANG, PEOPLE’S Republic of China

JOINT VENTURE CONTRACT

THIS JOINT VENTURE CONTRACT is entered into on February 14, 2014, in accordance with the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures and the Regulations for the Implementation of the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures (the “Joint Venture Law”), the Provisions for the Contribution of Capital by Parties to Joint Ventures Using Chinese and Foreign Investment and its supplementary provisions, and other relevant and officially promulgated Chinese laws and regulations between:

Zhangjiagang Chemical Machinery Co., Ltd., a company limited by shares established and existing under the laws of the PRC whose registered address is No. 20 Chengyang Road, Houcheng, Jingang Town, Zhangjiagang City, Jiangsu Province, 215631, PRC (“ ZCM ”).

AND

SES Asia Technologies, Limited. , a limited company established and existing under the laws of Hong Kong Special Administrative Region of the PRC whose registered address is 7/F., Bonham Centre 79-85 Bonham Strand, Sheung Wan (“ SESHK ”)

ZCM and SESHK may hereinafter be referred to individually as a “ Party ” or collectively as the “ Parties ”.

WHEREAS , the Parties intend to establish a Sino-Foreign Equity Joint Venture with the primary objective of:

Considering the above factors and confirming that the Parties are completely informed, in conformity with the principles of equality and mutual benefit, the Parties hereby agree as follows:

The following terms shall have the meanings set forth below:

“Affiliate”, with respect to a Party, shall mean any entity directly or indirectly controlling, controlled by or under common control with such Party; an entity shall be deemed to “control” another entity if the former possesses, directly or indirectly, no less than 50% voting shares or registered capital, or the power to appoint or elect the majority of directors or the actual control rights of the latter.

“Articles of Association” shall mean the Articles of Association of the Company dated as of the date hereof between the Parties, and as may be amended or restated from time to time by the Board.

“Basic Engineering Design Package” or “BEDP” shall mean a package of technical document deliverables prepared, after delivery of the PDP, for the next step engineering design, which shall comply with the China’s latest industrial standards.

“Board” or “Board of Directors” shall mean the Board of Directors of the Company.

“Business License” shall mean the business license to be issued to the Company by the competent PRC State Administration for Industry and Commerce, including the business license issuedby the authorities, which may be amended from time to time.

“Chairman” shall mean the chairman of the Board of Directors of the Company.

“China” or the “PRC” , for the purpose of this Contract, shall mean the People's Republic of China.

“Company” or the “Joint Venture” shall mean ZCM-SES Clean Energy Technologies Co., Ltd. or any other name approved by the competent authority, the equity joint venture company established by the Parties pursuant to the Joint Venture Law, other relevant and officially promulgated laws and regulations of the PRC, and this Contract.

“Confidential Information” shall mean technology and Know-How as well as trade secrets, strategic business or marketing information, business projections, secret processes and etc., including but not limited to processes, data, formulae, material balance, control logic, programs, manuals, designs, sketches, photographs, plans, drawings, specifications, reports, studies, findings, non-patented inventions and ideas, any data relating to a patent that is not disclosed in a granted patent, and other information relating to the production, packaging, use, pricing, or sales and distribution, whether of a technical, engineering, operational, business or economic nature, whenever provided by SESHK (or its Affiliates), or by ZCM (or its Affiliates), in connection with the establishment of the Company and any matters related thereto, the implementation of and/or the conduct of the business contemplated by this Contract and the other contracts contemplated herein. Confidential Information, however, shall not include information which is now or hereafter becomes part of the public domain through authorized publication, or information which the receiving Party can demonstrate was in its possession, prior to the effectiveness of the Contract, and which was legally obtained and is not in violation of any agreement.

“Contract” shall mean this Joint Venture Contract and the Annexes attached hereto.

“Critical Design Parameters” or “CDP” shall mean key SGT and SGT Proprietary Equipment design parameters for a project on a case-by-case basis, which are based on a specific basis for design for a project and are fundamental technology parameters required to initiate the PDP.

“Detailed Engineering Design Package” or “DEDP” shall mean the detailed engineering design package, which is prepared as a follow up to the BEDP.

“Director” shall mean a member of the Board of Directors.

“Effective Date” shall mean the day on which this Contract becomes effective and approved by the competent examination and approval authority.

“Establishment Date” shall mean the date on which the Business License of the Company is issued.

“Examination and Approval Authority” shall mean the competent authority as is duly authorized by law to approve this Contract.

“Force Majeure” shall mean any (a) acts of God; (b) flood, fire, earthquake or explosion; (c) war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; (d) government order or law; (e) actions, embargoes or blockades in effect on or after the date of this Contract; (f) action by any governmental authority; (g) national or regional emergency; (h) strikes, labour stoppages or slowdowns or other industrial disturbances; and (i) shortage of adequate power or transportation facilities.

“Foreign Exchange” shall mean any foreign currency which can be freely exchanged, converted, or traded in the open international currency market.

“General Manager” shall mean the general manager of the Company.

“GTI” shall mean the Gas Technology Institute of the United States.

“Improvements” shall mean any improvements within the SGT (including new inventions and designs) created, invented, developed or discovered by a Party or the Company after the Establishment Date with respect to the SGT process and SGT Proprietary Equipment.

“Joint Venture Term” shall mean the duration of the Company as provided for in Article 20 hereof.

“Labour Contract” shall mean the individual labour contract to be entered into between the Company and any of its employees, excluding Seconded Personnel.

“Management By-laws” shall mean the Company’s By-laws that are approved at the first Board of Directors Meeting.

“Management Personnel” shall mean the General Manager, Vice General Manager, Chief Financial Officer, Marketing Director, Chief Accountant, Chief Technology Officer, Chief Mechanical Engineer and such other senior personnel positions that are designated as Management Personnel positions by the Board from time to time.

“Pressurized Fluidized Bed” shall mean the gasification reactor or system, at any pressure above atmospheric pressure, that converts SGT Feed stock into syngas by reaction of SGT Feedstock with air, enriched air, or oxygen (with or without the addition of steam, carbon dioxide or other diluents gases) in a fluidized bed (including bubbling bed and fast fluidized bed) wherein SGT Feedstock is fed and syngas is produced.

“Process Design Package” or “PDP” shall mean a process design package prepared, on the basis of the existing PDP provided by SESHK, for a specific customer project for which a PSA has been executed, and which shall comply with China’s latest industrial standard.

“Project Sublicense Agreement” or “PSA” shall mean the agreement to be entered into by the Company as licensor, from which a technology license must be obtained from the Company for the normal operation of a Project in the Territory. The form of the PSA as set out in Annex3 shall be a reference and subject to any necessary changes as requested by the customer, as long as the technology will be protected during the implementation of such Project.

“Renminbi” or “RMB” shall mean the lawful currency of the PRC.

“Seconded Personnel” shall mean the employees of each Party or of any of its Affiliates, who will be seconded for providing full time services to the Company. The costs of such Seconded Personnel shall be borne by the Company.

“Services” shall mean any engineering or design services related to the SGT, modularization services, procurement services, construction management services, plant commissioning and start-up services, plant operations and maintenance services and any other services beyond this scope that are authorized by a unanimous vote of the Board.

“SES Gasification Technology” or “SGT” shall include the collection of SES Intellectual Property, Know-How, trade secrets and methods developed by SESHK and its Affiliates for its advanced fluidized bed gasification technology. The SGT has been extensively developed since 2004 and was initially based upon the U-Gas® technology licensed by SEST and its Affiliates from GTI, and which has been further developed through additional improvements, Know-How and patents developed by SESHK’s Affiliates through industry experience of SESHK’s Affiliates from developing, designing and operating projects in China and from designs by or for SESHK and its Affiliates in their development of projects globally. The SGT is one of the most advanced gasification technologies, which has been commercialized through the construction and operation of industrial projects to be reliable, environmentally-friendly, economically feasible, sustainable and in conformity with China’s energy independence policy and energy strategies. SGT is a part of the equity contribution of SESHK as described in the TUCA. Prior to the Establishment Date, SESHK has full rights and authorization of the SGT to be contributed to the Company. And any Improvement developed by the Company after the Company is established belong to the Company, subject to the terms of the TUCA.

“SES Shanghai” shall mean SES New Energy Technologies (Shanghai) Co., Ltd. ( 埃新斯新能源技术;上海;有限公司 ).

“SEST” shall mean Synthesis Energy Systems Technologies, LLC, a wholly owned subsidiary of Synthesis Energy Systems, Inc. and the licensor of the SGT license right to SESHK, which authorizes SESHK as the licensor in the TUCA.

“SGT Feedstock” shall have the meaning as defined in the Technology Usage and Contribution Agreement as set forth in Annex 4.

“SGT Know-How/Know-How” shall mean all commercial and technical information, including trade secrets, pertaining to the SGT, and/or ZCM’s manufacturing of the SGT proprietary equipment, including, but not limited to, theses, designs, drawings, blueprints, specifications, test data, charts, fabrication techniques, materials of construction, and formulations, graphs, operating and test procedures, shop practices and instruction manuals.

“SGT Proprietary Equipment” shall mean the Gasifier Reactor, Gasifier Heat Recovery Steam Generator, Cyclones, Filtration, Bottom Char Cooling and Removal System, Gasifier Coal Feeding System; Metering/Measuring System; Gasifier Control and Safety System logic etc., subject to adjustment per the requirements of customer.

“Sub-license Royalty To GTI” shall mean ***% of the license fee to be paid to GTI, pursuant to the legally effective agreement between SEST and GTI, from the license fee received under any sub-license Project by the Company.

“Technology Usage and Contribution Agreement” or “TUCA” shall mean the authorization agreement for the use of technologies related to SGT, and agreement related to SGT and performance guarantee as described in TUCA which shall be contributed to the Company as SESHK’s capital contribution, and which shall be in accordance with Annex 4.

“Territory” shall mean China, Indonesia, the Philippines, Vietnam, Mongolia and Malaysia as set forth in the TUCA.

“United States Dollars” or “US$” shall mean the lawful currency of the United States of America.

“Working Personnel” shall mean all employees of the Company other than Management Personnel and members of the Board.

*** This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

“Yima Plant” shall mean the project/plant operated and managed under the joint ventures of YMCIG-SES New Energy Company Ltd., YMCIG-SES Methanol Products Company Ltd. and YMCIG-SES New Gas Company Ltd.

“ZZ Plant” shall mean the project/plant operated and managed under the joint venture of SES (Zaozhuang) New Gas Company Ltd., a company under super majority control of Synthesis Energy Systems, Inc.

The Parties to this Contract are as follows:

The legal representative of ZCM is:

Name: CHEN, Yuzhong

Position: Chairman

Nationality: Chinese

The duly authorized representative of SESHK is:

In accordance with the Joint Venture Law and other relevant and officially promulgated PRC laws and regulations, the Parties hereby agree to establish the Company pursuant to the terms of this Contract. The Company shall be a legal person under the laws of the PRC subject to the protection and jurisdiction of PRC law.

The name of the Company shall be ZCM-SES Sino – US Clean Energy Technologies Co., Ltd. in English and 张化机综能中美 清洁能源技术有限公司 in Chinese, or other name as approved by the competent authority.

The legal address of the Company shall be in Zhangjiagang, and subject to the final address specified in the business license.

The Company shall be a limited liability company established in accordance with the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures and the Regulations for the Implementation of the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures, the Provisions for the Contribution of Capital by Parties to Joint Ventures Using Chinese and Foreign Investment and its supplementary provisions, and other relevant and officially promulgated Chinese laws and regulations.

Neither Party is the agent of the other Party nor does either Party have any power to bind the other Party or to assume or to create any obligation or responsibility, express or implied, on behalf of the other Party in the other Party's name. Neither this Contract nor any of the other agreements contemplated herein shall be construed as constituting a partnership between ZCM and SESHK or as creating any other form of legal association which would impose liability upon one Party for the act or failure to act of the other.

With the desire to strengthen the economic and technical cooperation between the Parties, the purpose of the Company will be to use advanced and available techniques and scientific management methods to improve the SGT, develop new products, and enable competitiveness in quality and price in the international market; to be compatible with the needs of the Chinese clean coal chemical development, and to satisfy the gradually increasing market demand for clean energy; enable economical and clean conversion of SGT Feedstock into syngas for the production of a variety of high value products such as chemicals, power, transportation fuels, direct reduced iron (DRI) steel, fertilizers, synthetic natural gas (SNG) and industrial fuels through the efficient collaboration of ZCM which, has a strong capability in coal chemical equipment manufacturing, engineering and related services in China, and SESHK’s advanced SGT which has been utilized in industrial gasification projects. The Company aims to make the SGT the primary gasification technology in the Territory, through its scientific business management.

The business scope of the Company is to obtain full exclusive authorization in the Territory to provide SGT and related technologies, engineering services and SGT sub-licensing rights, engineering design of the SGT, supply related technologies and supply SGT Proprietary Equipment, to manufacture and sell SGT Proprietary Equipment, toprovide SGT EPC project services, and to develop and improve the scope, pressure and capacity of the SGT, etc. The business scope shall be subject to the business scope as shown on Business License.

The total investment for the Company shall be RMB153,800,000 (in words: RenminbiOne Hundred Fifty-Three Million Eight Hundred Thousand).

The registered capital of the Company shall be RMB 153,800,000(in words: Renminbi One Hundred Fifty-Three Million Eight Hundred Thousand) and shall be contributed by the Parties in the following proportions:

In accordance with Article 12.6, the Company may obtain additional funds through loans from domestic or foreign financial institutions on terms and conditions approved by the Board of Directors and the Parties. The Company may also obtain loans or guarantees from the Parties or their Affiliates on terms and conditions to be determined by the relevant parties; provided, however, that no Party shall be obligated to lend funds to the Company or to guarantee a loan to the Company from a third party or financial institution or if a guarantee is required, each Party shall, in principle, undertake its share in such guarantee in a proportion equal to its Equity Interest in the Company. In the event that a Party does agree to lend funds to the Company or to guarantee a loan to the Company from a third party or financial institution, such Party shall be entitled to be paid interest on the loan at such rate or guarantee fees in such amount that such Party would have been entitled to be paid as if such Party were not a party to this Contract and as if the transaction were a negotiated arm's length financing from a third party. The Company may mortgage or otherwise grant a security interest in its assets, as permitted by law, to be mortgaged or secured in order to obtain loans.

ZCM shall make the initial capital contribution to the Company with thirty (30) days upon issuance of the Business License, in an amount not less than RMB 53,800,000, while ZCM shall make the remaining capital contribution to the Company within two (2) years. However, if at any time during such two (2) year period the Company’s cash balance drops below a level where the Company has less than enough cash to cover eighteen (18) months of operations (based on the last budget as approved by the Board and not including any borrowings by the Company), then ZCM shall be obliged to inject all of its remaining registered capital to the Company.

SESHK shall make its capital contribution to the Company within thirty (30) days upon issuance of the Business License.

Within thirty (30) days after the Parties have made their capital contributions, the Company shall engage an independent accountant registered in China to verify such contributions, with verification expenses borne separately by the Parties.

Upon the issuance of a verification report by such accountant, the Company shall issue to each contributing party an interim capital contribution certificate signed by the Chairman evidencing that the contribution was made. The Company may issue such interim capital contribution certificates from time to time as ZCM makes further capital contributions, which have been verified by the accountant within thirty (30) days of each contribution. Thirty (30) days after the entire registered capital of the Company has been contributed by ZCM, the Company shall request that an accountant registered in China verify each Party's total contributions and issue a final certificate of verification. Upon receipt of the final certificate of verification from the independent accountant, the Company shall promptly issue a final capital contribution certificate to each Party setting forth the aggregate amount of such Party's contribution(s). Upon the issuance of the final capital contribution certificate(s), such Party shall surrender to the Company for cancellation all of the interim capital contribution certificates signed by the Chairman.

Any increase or reduction in the registered capital of the Company shall be approved by the Board of Directors and submitted to the competent Examination and Approval Authorities for approval. Upon receipt of such approval, the Company shall register the increase or reduction in the registered capital with the appropriate administration for industry and commerce.

Except as otherwise contemplated in this Contract, neither Party may mortgage, pledge, charge or otherwise encumber its equity interests in the Company, its rights and obligations under this Contract and other interests in the Company (“ Equity Interests ”) without the prior written consent of the other Party, which shall not be unreasonably withheld.

Any Party who desires to sell or otherwise transfer its Equity Interests in the Company shall bear the cost of any valuation of the Company as an on-going concern. The Parties shall render all assistance and provide all such documentation and other information to the appraiser as such appraiser may consider necessary.

Prior to the Transfer of a Party’s Equity Interests, both Parties shall continue to perform their obligations under this Contract.

The Transfer of a Party’s Equity Interest shall not release such Party from its liability to pay any sums of money accrued, due and payable, or to discharge its then-accrued and unfulfilled obligations to the Company or the other Party.

ZCM hereby represents and warrants to SESHK as follows:

SESHK hereby represents and warrants to ZCM as follows:

In addition to its other obligations under this Contract, ZCM shall have the following responsibilities:

In addition to its other obligations under this Contract, SESHK shall have the following responsibilities:

*** This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

Ensuring that the Company obtains free access to all the coal testing data, currently and in the future, of various coals from SESHK and its affiliate and GTI (if any)

The Company shall comply with officially-promulgated environmental protection, health and safety, and other compliance rules of the PRC imposed on the Company during the operation and shall undertake any costs of bringing the Company's operations (but not the individual operations of either Party hereto) into compliance with any subsequent officially-promulgated environmental protection, health and safety, and other compliance rules of the PRC imposed on the Company.

In accordance with this Contract, the Company shall be entitled to purchase and acquire necessary raw materials, tools, machines and equipment, parts, office supplies and services for the establishment and operation of the Company, from both the domestic and international market on a best value basis. ZCM will assist the Company in obtaining raw materials, utilities services and on-site support, per the above. All such raw materials, machines and equipment, and parts shall be in compliance with the applicable quality standards of the Company and PRC laws and regulations. The Company shall have the right to utilize the service of ZCM, SESHK or any third party for purchase of, or may directly purchase parts, materials and office supplies from overseas markets, subject to approval by the Board of Directors of the Company. Both Parities shall use their best efforts to procure the lowest possible prices for the materials to be purchased by the Company.

The Company will endeavour to expand the scope of supply of equipment and engineering design with a key objective to eventually include turnkey gasification island offerings with expansion to gas cleaning.

The Board of Directors of the Company shall be established by the Parties and shall hold its first meeting within thirty (30) days of the Establishment Date.

The Board of Directors shall be composed of five (5) Directors, of whom three (3) shall be appointed by ZCM and two (2) by SESHK, among which, ZCM shall appoint the Chairman of the Board and SESHK shall appoint the Deputy Chairman. The tenure of Directors on the Board, including Chairman and Deputy Chairman, shall be no more than four (4) years. Directors may be permitted to serve another term if re-appointed. Any vacancy created in the Board of Directors shall be filled by the Party which originally appointed the absent Director causing the vacancy. Any Party may at any time remove for any reason any or all of the individuals appointed by such Party as a Director and appoint in lieu thereof another individual or individuals to serve the remainder of the relevant term(s).

The Chairman of the Board shall be the legal representative of the Company and shall act in accordance with the specific decisions, resolutions and instructions of the Board of Directors. Whenever the Chairman is unable to fulfil his/her duties to call and preside over a board meeting, the Deputy Chairman has the right to act for and on his/her behalf.

The Board of Directors shall be the highest authority of the Company and shall make decisions on all major and important matters of the Company. The rules of procedure governing the Board of Directors and its powers and responsibilities are set forth in this Contract and the Articles of Association.

A Director, including the Chairman and Deputy Chairman, shall not have personal liability for action he/she undertakes on behalf of the Company within the scope of authority of this Contract, the Articles of Association or the Board resolutions unless his or her action:

Any Director, including the Chairman and Deputy Chairman, acting in violation of this Contract or Board resolutions shall indemnify and hold harmless the Company against all losses caused to or liabilities and expenses incurred by the Company. The Company shall, to the extent permitted by law, indemnify any Director for damages or losses incurred in good faith by such Director in the performance of his or her obligations.

Matters to be decided by the Board shall be approved by a simple majority vote of the Directors except for the matters listed below which shall require a unanimous vote of Directors:

In the event of a deadlock the Parties will follow relevant laws and will work in good faith to try and resolve such deadlock.

The regular meetings of the Board of Directors shall be held at least two (2) times per calendar year, with each regular meeting to be held no later than twenty (20) days before closing of each half of that calendar year, unless otherwise agreed by both Parties. Meetings of the Board of Directors shall normally be held at the registered address of the Company at the date as set by the Chairman, but may be held at the alternative location and/or date as proposed by one Party if the other Party expresses no objection to such proposal or, though expresses objection, fails to propose an alternative location and/or date for the meeting within two (2) weeks of the originally proposed date by the first Party, where the other Party shall be deemed to be in attendance and counted for the purpose of the quorum.

Within three (3) days after the receipt of the written proposal by at least one-third (1/3) of the Directors requesting that an interim Board meeting be held, either the Chairman or the Deputy Chairman shall send a written notice calling an interim Board meeting. Interim Board meetings shall be held, in principle, in the form of teleconference or video-conference.

The written notice shall be sent at least twenty (20) days prior to any Board meeting specifying the agenda, time and place of the meeting. Such notice may be waived by the unanimous consent of all Directors attending (in person or by proxy) the meeting. A Board meeting shall be convened not less than twenty (20) days or more than thirty (30) days from the date of the notice.

In extraordinary circumstances requiring immediate action by the Board and otherwise as provided in this Contract, the Chairman or the Deputy Chairman may call an emergency meeting of the Board. The Chairman shall send written notice at least twenty-four (24) hours prior to any emergency meeting, specifying the agenda, time and place of the meeting.

A Director may attend a Board meeting in person, by conference telephone or designating another person by proxy to vote in his place. Such designation shall be in writing and signed by the Director, and shall identify the meeting or meetings at which the person may act as a proxy and any instructions that may be applicable to the proxy. A Director may appoint another Director as his proxy. A person acting as a proxy may do so for more than one (1) Director.

The quorum for a Board meeting shall consist of two-thirds (2/3) of the Directors present in person or by conference telephone or by proxy, with each Party having at least one (1) Director present. However, if a proper notice to convene a Board meeting has been given and if the Directors appointed by a Party fail to attend the meeting by themselves or by proxy or by conference telephone, and therefore a quorum is not present as aforesaid, such Board meeting shall be adjourned and reconvened at the same location and time fifteen (15) days later. If, at the reconvened Board meeting, these Directors still fail to attend by themselves or by proxy or by conference telephone, the present Directors shall vote in respect of the resolution(s) (the proposal of which shall have already been set out in the enclosures of the notice of the Board meeting). Resolutions passed in such manner shall have full legal effect.

The Directors may vote on any matters by attending meetings in person, by telephone conference or by proxy. Each Director, including the Chairman and Deputy Chairman, shall have only one vote. Matters not requiring a unanimous vote by the Board of Directors shall be decided by a simple majority vote of the Directors at a meeting at which a quorum is present.

The Board of Directors may conduct any business and make decisions and take actions that could have been otherwise duly taken pursuant to a Board meeting by means of a unanimous written consent in lieu of a meeting.

The Company shall not pay any fee, remuneration or subsidy to any Director for his/her attendance at a Board meeting. The Company shall reimburse a Director for reasonable expenses incurred in respect of travelling, accommodations and other living expenses to attend Board meetings.

Minutes shall be kept for each Board meeting and signed by all Directors present at the Board meeting in person or by proxy. In order to facilitate the smooth conduct of Board meetings, the Deputy Chairman shall appoint a “designee” for the purpose of the Board meeting. The duties of such designee shall be to take detailed minutes of the Board meeting, procure the proper signatures for the adoption of such minutes, translate or arrange for the translation of documents and dispatch documents relating to the Board meeting to the Directors. Minutes of the Board meeting shall be maintained in both Chinese and English. Copies of the minutes in both Chinese and English languages shall be sent to ZCM and SESHK at the addresses set forth in Article 28.6 herein.

The Company shall abide by any other policies and procedures adopted by the Board. The Parties shall take all appropriate actions to cause the Board of Directors and board of Supervisors to adopt standards of conduct and business practices in conformity with the laws and regulations of the PRC and such laws and regulations of the United States which apply to SESHK’s operations outside the United States, provided that they do not conflict with the laws and regulations of the PRC.

The specific powers and responsibilities of Management Personnel shall be prescribed in the relevant provisions of the Articles of Association of the Company. Except for gross negligence, no Management Personnel shall have any personal liability for any acts performed in good faith, in the normal course of their employment and within the scope of activities permitted to be engaged in by such Management Personnel as set forth in this Contract and the Articles of Association.

Matters such as salaries, wages, subsidies, benefits, insurance, allowances, rewards and other compensation matters of Management Personnel, except for Seconded Personnel, shall be stipulated in the Labour Contract between the Company and such Management Personnel.

Each member of the Management Personnel shall, as a precondition to employment by the Company, execute an agreement in form and substance acceptable to the Board which shall contain provisions prohibiting the disclosure of confidential information obtained during the course of employment with the Company and prohibiting such personnel from competing with the business of the Company.

Except for Seconded Personnel, all Management Personnel are forbidden from concurrently serving or working in any other company, unit, entity or organization whatsoever unless explicitly approved by the Board.

The Company shall publish Management By-laws, which shall regulate coordination of responsibilities within management, reporting and work procedures; areas of responsibility, decision-making competency, any other issues decided by the Board.

The said Management By-laws, as approved by the Board at the first Board meeting, shall be provided in both Chinese and English.

The Company shall have all possible autonomy under the laws and regulations of the PRC concerning the recruitment, employment, compensation, welfare benefits, procurement of labour insurance, promotion, discipline and dismissal of Working Personnel. The labour policies of the Company shall be determined in accordance with applicable PRC labour law, labour contract law and regulations and the relevant local rules on labour management in foreign investment enterprises.

The Company shall have right to select from SES Shanghai. The Company and SESHK will consult with each other on the remuneration of such SES Shanghai employees, and execute a separate memorandum on the employment of such employees within ten (10) working days of the execution of this Contract.

The qualification and number of Working Personnel shall be determined in accordance with the operating needs of the Company as determined by the Board. Each Working Personnel shall, as a condition to employment by the Company, execute a Labour Contract with the Company, to the extent permitted by the labour laws and regulations of the PRC. Working Personnel shall observe the various rules and regulations of the business of the Company in fulfilling their respective tasks.

Prior to the establishment of the Company, various SES Shanghai employees provided services to the ZZ Plant and the Yima Plant. Should the ZZ Plant require such services or support after the establishment of the Company, the Company shall provide such services or support, as reasonably requested, at cost. Should the Yima Plant require such services or support after the establishment of the Company, the Company shall provide such services or support, as reasonably requested, at a reasonable mark-up.

Matters such as compensation, wages, subsidies, benefits, insurance, allowances, rewards, and other compensation matters of Working Personnel shall be stipulated in the Labour Contract between the Company and each Working Personnel; the provisions therein shall be in compliance with Applicable Law.

The Company shall conform to rules and regulations of the Chinese government concerning labour protection. Working Personnel shall have the right to establish a Labour Union in accordance with the applicable laws.

All candidates, except for the Management Personnel and the personnel taken over from SES Shanghai to the Company, must satisfactorily complete the training program(if any) specified in their Labour Contracts and a subsequent probationary period of work before they will be officially considered employees of the Company. An employee’s direct supervisor shall have right to decide, on behalf of the Company, whether such persons have successfully completed their probationary period and shall be granted employment, or that such persons shall not be granted employment for whatever reasons, including lack of qualification or otherwise. Any person to whom the Company does not offer employment after the probationary period shall be given notice before dismissal.

The General Manager shall be responsible for the preparation of the annual operating plans and budgets of the Company. The operating plan and budget for the next fiscal year shall be submitted to the Board of Directors for examination and approval prior to November 1of each year and shall include detailed plans and projections regarding:

The Board of Directors shall complete its examination and approval of each annual operating plan and budget for the next fiscal year prior to the end of December 31 ^st of each year. The Management Personnel shall be responsible for the implementation of the annual operating plan and budget as approved by the Board.

The Company shall pay taxes in accordance with relevant Chinese laws and regulations and shall enjoy all preferential tax and customs treatment available to it under the PRC law. In order to confirm the tax treatment applicable to the Company, the Parties shall, immediately after the Establishment Date, procure that the Company submit an application to the appropriate tax authorities of China requesting confirmation of the tax and duty exemptions, reductions and other preferences to be accorded to the Company.

Furthermore, with the Assistance of ZCM, the Company shall also apply for any other reductions of or exemptions from relevant taxes and customs duties which are now available or will become available to the Company under any of the laws and regulations of the PRC.

After fully making up accumulated losses of previous years, if any, and payment of taxes in accordance with the relevant laws and regulations of the PRC, the Company shall allocate and reserve ten percent (10%) of its annual after-tax profits as the Company's statutory common reserve. The Company may stop allocating and reserving the profits if the aggregate balance of the common reserve accounts for over fifty percent (50%) of the Company's registered capital. After the Company has drawn statutory common reserve from the after-tax profits, it may, upon a resolution made by the Board meeting, draw a discretionary common reserve from the after-tax profits. The amount to be drawn as statutory common reserve shall be decided by the Board annually in accordance with the financial status of the Company and pursuant to the laws and regulations of China.

The Company shall keep true and correct records and accounts in accordance with applicable PRC accounting laws. All accounting records, vouchers, books and statements of the Company shall be made and kept in Chinese, however, on the other hand, the Company shall provide financial reports to SESHK in English on a quarterly basis in accordance with USGAAP.

Each Party shall have the right to examine and copy all books of account, records, vouchers, contracts and documents of any kind that are necessary or appropriate for monitoring the financial performance of the Company. Each Party may make such examination and copies during the Company’s normal business hours, provided that such examination and copying do not unreasonably interfere with the business operations of the Company. Each Party may exercise such rights through its agent or employee or by an independent accounting firm designated by the Party (at its own cost).

The currency of accounts of the Company shall be Renminbi. When foreign currency transactions take place, the foreign currency amount will be converted into the reporting currency for recording purposes. Any increase or decrease in the balance of accounts relating to foreign currency transactions shall be translated into the currency of account in accordance with the official Foreign Exchange rate announced by the People’s Bank of China on the transaction date or on the first day of the month when the transaction takes place.

The Company shall prepare and provide to the Parties:

A qualified independent accounting firm, licensed in China, shall be engaged by the Company as its auditor, which shall be the same auditor as engaged by ZCM, to examine and verify the annual financial statements of the Company and shall submit the audit report to the Board and the General Manager. Either Party shall also have the right to appoint an accountant registered in China or abroad to audit the accounts of the Company. The expense of the auditor shall be borne by the Party appointing the auditors. Unless the result of any such auditor is significantly different from that conducted by the Company’s auditor and are accepted by the Board, the expense of such audit shall be borne by the Company. The Company will permit such accountant to have access to the Company’s books and records and Management Personnel and will provide such accountant with office space and all other reasonable facilities to enable the accountant to carry out the audit.

The Company shall provide, without charge, to any Party that may so request a copy of each tax return and report that it is required to file with any governmental entity in sufficient time prior to such filing to permit its review by such Party prior to filing.

The Company shall open RMB deposit accounts and Foreign Exchange deposit accounts with authorized banks in China, and the procedures for issuing and signing checks shall be implemented in accordance with the management policies of the Company. The Company may also open Foreign Exchange deposit accounts with foreign banks outside China as designated by the Board of Directors subject to approval by the relevant government authorities.

The term of the Company established under this Joint Venture Contract and the Articles of Association shall be twenty (20) years, commencing on the date of issuance of the Company's Business License by the relevant administration for industry and commerce (the “ Joint Venture Term ”).

One (1) year prior to the expiry of the Joint Venture Term, the Parties shall enter into discussions regarding the extension of such term. If the Parties agree to extend the Joint Venture Term, they shall enter into a written extension agreement and apply to the Examination and Approval Authority for approval no less than six (6) months prior to the expiration of the Joint Venture Term. The Joint Venture Term may be extended only upon the execution of the written extension agreement by the Parties and approval of the Examination and Approval Authority.

This Contract may be terminated in the event that any of the conditions or events set forth below occurs:

Where the TUCA is terminated pursuant to Article 21(b) or other provisions herein, the Company shall be liquidated in accordance with Article 22.1.

In case this Contract is terminated early upon the occurrence of any of the above circumstances, both parties shall observe and abide by the requirements and consequences as stipulated in Article22.3.

Upon the adoption of a unanimous Board resolution to terminate this Contract pursuant to Articles 12.6 and approval by the Examination and Approval Authority to dissolve the Company, the Parties shall cause the Directors appointed by them to adopt a resolution to liquidate the Company and establish a liquidation committee. The composition, powers and functions of the liquidation committee, formulation of liquidation procedures, and payment of liquidation proceeds shall be set forth in the Articles of Association.

In the event of a liquidation of the Company, any of ZCM’s paid-in registered capital contribution to the Company after deduction of the dividends should be, or already received by ZCM before liquidation, shall be returned to ZCM in priority within the existing liquid assets (excluding the intangible assets); and SESHK shall not be entitled to such funds; and any remaining cash current net assets shall be distributed to the Parties according to the respective ownership percentage.

The dissolution of the Company or sale of the Company as a going concern, shall not release a Party from its liability to pay any sums of money accrued, due and payable to the other Party, or to discharge its then-accrued and unfulfilled obligations including any liability to the Company or the other Party in respect of any breach of this Contract pursuant to the provisions hereof.

Notwithstanding the foregoing, prior to the liquidation of the Company, SESHK shall have (i) the right to take out from the premises of the Company any materials relating to SGT provided by SESHK, including any proprietary property provided to the Company pursuant to this Contract and any other documents, drawings, data, or information in any form; and (ii) have the right of first refusal to purchase any SGT-related intellectual property legitimately owned by the Company on the same conditions that would be afforded to any reasonable buyer. If the Company and SESHK cannot agree on such value then SESHK shall be entitled to appoint an independent valuation form to appraise the value of such SGT related intellectual property.

If a Party fails to perform any of its material obligations under this Contract, or if a representation or warranty made by a Party under this Contract is materially untrue or inaccurate, the Party shall be deemed to have breached this Contract.

Provided that each of the conditions in Article 5.4has either been expressly fulfilled or waived by the Parties, should one of the Parties fail to pay any portion of its contribution to the registered capital of the Company at the time and in the amounts stipulated in Article 5of this Contract, such Party shall be deemed to be in breach of the Contract and, in addition to any liability it may incur for such breach, such Party shall pay to the Company a late contribution penalty at a monthly rate equal to the then applicable lending rate of the same kind and duration which is published by the People’s Bank of China for Renminbi loans on the amount of the contribution due and unpaid for as long as such contribution is due and unpaid.

During the period of breach, the Parties shall in all other respects continue their implementation of this Contract.

The Company shall, at its own cost and expense and at all times during the operation of the Company, procure and maintain full and adequate insurance coverage in a manner prudent and advisable for the Company. The relevant insurance policies may be obtained from any insurance company authorized to provide such policies in the PRC. The types of insurance (which shall include product liability insurance) and the value, duration and denomination of the currency of the premiums and insurance proceeds shall be determined by the Board of Directors based upon the recommendation of the General Manager based on the practices of similar business in other countries and the actual circumstances in the PRC.

If any Party is prevented from performing any of its obligations due to an Event of Force Majeure, the time for performance of the obligations under this Contract specifically prevented from performance by such Event of Force Majeure shall be extended by a period equal to the period of delay caused by such Event of Force Majeure. A Party claiming inability to perform due to an Event of Force Majeure shall take appropriate means to minimize or remove the effects of the Event of Force Majeure and, within the shortest possible time, attempt to resume performance of the obligation(s) affected by the Event of Force Majeure. If an Event of Force Majeure occurs, no Party shall be responsible for any damage, increased costs or loss which the other Parties may sustain by reason of such a failure or delay of performance, and such failure or delay shall not be deemed a breach of this Contract. All other obligations under this Contract and the time for performance thereof shall remain unaffected.

The affected Party shall immediately notify the other Party of the occurrence of any Event of Force Majeure and shall provide available evidence thereof. Should the delay caused by any Event of Force Majeure continue for more than ninety (90) consecutive days, the Parties shall settle the issue of further performance of this Contract through friendly negotiations in accordance with Article 27(a) and (b).

During the period of an Event of Force Majeure, the Parties shall in all other respects continue their implementation of this Contract.

The laws or regulations of the PRC which are officially published and publicly available shall apply to and govern the formation, validity, interpretation and implementation of this Contract. In the event that there is no officially published and publicly available law of China governing a particular matter relating to this Contract, reference shall be made to the relevant provisions in any treaty to which the PRC is a member or signatory. If there is no such applicable treaty provision, then reference shall be made to general international practices.

In the event of a dispute arising out of or relating to this contract, including any question regarding its existence, validity or termination, the Parties shall first seek settlement of that dispute by friendly consultation. Upon the occurrence of a dispute, then any Party is entitled to send a notice to the other Party (the “ Reconciliation Notice ”), to require the Parties to attempt to solve this dispute matter through reconciliation within one (1) month after its occurrence, during which time the Parties shall attempt in good faith to resolve the disagreement and shall cause their respectively designated high level representatives (the “ Dispute Representatives ”) to enter into a period of thirty (30) days to negotiate to attempt to resolve the disagreement.

If the Dispute Representatives have not agreed upon the matter in issue within thirty (30) days, any Party is entitled to request the joint appointment of an internationally recognised independent expert in the area related to the matter in issue (the “ Expert ”) to resolve the matter in dispute, provided that, in making its determination, the Expert shall consider the interests of the Company. Such Expert's determination shall be non-binding on the Company and the Board. Both parties shall exert best endeavour in good faith to seek the settlement of the dispute and enforce the decisions made by the Expert.

If the Parties fail to jointly appoint such Expert or the Expert fails to reach a determination related to the resolution at issue within ninety (90) days after the occurrence of the dispute, either of the Parities shall be entitled to submit the dispute to China International Economic and Trade Arbitration Commission (“ CIETAC ”) for arbitration in Beijing, PRC.

No public statements shall be made by one Party on behalf of the other Party without its prior written consent.

All marketing, advertising and promotional material relating to the Company shall be subject to prepublication review and mutual agreement by both Parties.

This Contract is executed in both English and Chinese in twelve (12) original counterparts in each language. Both language versions shall be equally valid .

This Contract and the other agreements contemplated herein constitute the entire agreement among ZCM and SESHK with respect to the subject matters set forth herein and therein and supersede all prior discussions, notes, memoranda, negotiations, understandings and all the documents and agreements between them relating to the same. All documents, agreements, understandings and correspondence between the Parties prior to the execution of this Contract shall, with the exception of any non-disclosure/confidentiality undertakings, become null and void automatically when this Contract enters into effect.

Amendments to this Contract and the other agreements contemplated herein may be made only by a written agreement in English and Chinese signed by duly authorized representatives of each of the Parties and, unless prior approval from the Examination and Approval Authority is statutorily required, will become effective as soon as the amendments are filed with the Examination and Approval Authority for record.

The rights and obligations of the Parties established by and under this Contract shall continue to exist throughout the Joint Venture Term and shall not be prejudiced by the establishment of the Company, the adoption of the Articles of Association or the execution of any of the agreements contemplated herein. In the event of any conflict or inconsistency between this Contract on the one hand and the Articles of Association or other agreements contemplated herein on the other, the Articles of Association and other agreements contemplated herein shall prevail.

Notices or other communications required to be given by any Party or the Company pursuant to this Contract shall be written in English and Chinese and may be delivered personally, sent by registered airmail (postage prepaid) by a recognized courier service, or sent by facsimile transmission to the address of the other Party set forth below or such other address notified in lieu thereof. The dates on which notices shall be deemed to have been effectively given shall be determined as follows:

For the purpose of notices, the addresses of the Parties are as follows:

ZCM: Zhangjiagang Chemical Machinery Co., Ltd.

No. 20 Chengyang Road, Houcheng, Jingang Town, Zhangjiagang City, Jiangsu Province, 215631, PRC

Attention: XU, Ye

Telephone No: 0512-5673-9008

Facsimile No.: 0512-5673-9009

7/F., Bonham Centre 79-85 Bonham Strand, Sheung Wan

Attention: ROBERT WAYNE RIGDON

Telephone No: 001-(713) 579-0600

Any Party may at any time change its address for service of notice or communication in writing delivered to the other Party in accordance with the terms hereof.

Unless otherwise provided for, failure or delay on the part of any Party to exercise any right or privilege in this Contract shall not operate as a waiver of such right or privilege nor shall any partial exercise of any right or privilege preclude any further exercise thereof. Any waiver by a Party of a breach of any term or provision of this Contract shall not be construed as a waiver by such Party of any subsequent breach, its rights under such term or provision, or any of its other rights hereunder.

The headings contained in this Contract are for reference only and shall not be deemed to be a part of this Contract or to affect the meaning or interpretation hereof.

The formation of the Company will be submitted to related PRC approval authority for approval in accordance with related legal procedures.

With the signature of each Party’s representative, which has been authorized by such part’s board of directors, this Contract will come into effect upon government approval.

[ signature pages follow ]

IN WITNESS WHEREOF , the Parties hereto have caused this Contract to be executed as of the date first above written by their duly authorized representatives.

By:

By:

SES Asia Technologies, Limited.

Annex

The followings are the annex that are being discussed or should be discussed or drafted, and the Party to do that.

1. Business Plan/Objectives

2. SGT Technology Material

3. Form of Project Sub-license Agreement

4. Technology Usage and Contribution Agreement

5. Appraisal Report for SESHK’s capital contribution

6. SGT Equipment Sales Framework Agreement

7. Representation Letter from SES and its affiliates for jointly undertaking the obligations and responsibilities of SESHK.

Annex 1

张家港化工机械股份有限公司 (“ 张化机 ”) 与综合能源系统公司 (“SESHK”)

成立中国煤气化合资公司

商业计划书

Business Plan for Establishing China Coal Gasification Joint Venture by ZCM & SESHK

张家港化工机械股份有限公司 (“ 张化机 ”) 与综合能源系统公司 (“SESHK”) 双方将成立一家排他性的中国技术和设备合资公司（ “ 合资公司 ” ），其主要目标是：结合 SES 的气化技术与张化机的装备制造能力使 SES 气化技术成为中国领先的气化技术解决方案供应商；建立合资公司的价值；为双方带来可观的收入和利润；最终目标是在公开市场上市（如：中国大陆、香港或其他地区）。

Zhangjiagang Chemical Machinery Co., Ltd. ("ZCM") and Synthesis Energy Systems, Inc. ("SESHK") are establishing an exclusive China technology and equipment joint venture ("JV"), whose main objectives are: to combine SES gasification technology with ZCM equipment fabrication capabilities to become China's leading gasification technology solution provider; build the JV enterprise value; bring considerable revenues and profits for both sides; with the ultimate objective of seeking a public markets listing (eg: China mainland, Hong Kong or elsewhere).

The two sides will set up a sino-foreign joint venture with registered capital of 153.8mm RMB.

Management team: SES will provide SES staff supportrecognized by both sides to the JV. ZCM will provide additionalmarketing, equipment design and manufacturing, management, finance and financing, market development personnel with experience in the coal chemical industry. The JV will recruit further additional professional and managerial staff according to the needs.

Business scope:

The JVis fully authorized to exclusively conduct design, manufacture and sale of SES gasification technology, proprietary equipment and and ancillary services for the clients’ projects in the authorized Territory.

The JV is fully authorized to conduct marketing, sale, licensing, manufacture and after-sale service of SES gasification technology and proprietary equipment in the authorized Territory.

The main scope includes:

PDP and relevant design: PDP/design, the JV is responsible to complete PDP design (SES will provide training and assist the JV on PDP design as outlined in the relevant agreements at the beginning of the establishment of the JV). The JV is responsible to coordinate to complete BEDP and DEDP. SES has the obligation and responsibility to provide all key design parameters for the eligible JV projects.

Provide proprietary and relevant equipment: all the proprietary equipment and gasification technology are bundled together as a combined customer solution and marketed to clients through the JV.

The JV must endeavor to expand the equipment supply range so that this range can be developed from providing proprietary equipment and gasification technology tofurther providing other gasification and syngas purification equipment as much as possible.

Design, purchase and construction (EPC): the JV will try to expand the scope of delivery of equipment and design. The main objective is turnkey supply of an integrated gasification island to supply cost effective syngas, the ultimate objective is supply of the whole project EPC – equipment and technology.

Cold start up, commissioning and subsequent operation and maintenance: the JV will sell cold start-up commissioning and follow-up technical services, and may decide to offer post-commissioning operation and maintenance services.

三、技术、产品与服务/Technology, Products and Services

Technical background, intellectual property rights

SES gasification technology is an advanced fluidized bed gasification technology developed from the U-GAS® technology that Synthesis Energy Systems Technologies, LLC (“SES Techco”) obtained the licensing authorization from US Gas Technology Institute (“GTI”). The technology gained experience fromprojects being developed, designed and operated in China and the preliminary design of global projects being developed through SES Techco, and it also obtained continuous new technical improvements, technical know-how and patents developments through industry experience of the senior technical team of SES Techco and its affiliates. The targeted application includes all gasification projects using low quality coal and renewable fuels, such as woody biomass and municipal solid waste.

SES Techco will provide training to the JV, as outlined in the agreements, to enable the JV have the ability to complete the PDP design of third-party project. The JV’s training program will be developed and implemented.

Technical improvements made by either the JV or by Techco will be owned and shared as outlined in the.

Introduction of products and services:

Provide full range of services, include but not limited to coal sample analysis, technical proposal development, coal testing at SES-owned plants, quotes, PDP, design, production and manufacturing solutions, process routes and major equipment, general contracting, cold start up, after sale service, technology updates and financial products service support when necessary.

Main products:

Gasification technology licensing, gasification engineering design, proprietary equipment (components) and other equipment (parts) supply/sales.

EPC scope of work covering the gasification island: execution of EPC work scope to construct gasification island projects integrated with technology.

Provide syngas: focus on coal gasification plant packaged solution(s) and provide integrated solution for syngas to downstream users based on market conditions and customer demand.

Start up and post-commissioning maintenance and optimization services.

Others.

四、市场竞争与市场营销/Market Competition and Marketing

Analysis of coal chemical industry situation and development trend

The value proposition focuses on China's coal chemical industry development during the past 10 years: "Green Storm" awakened the attention to chemical safety, environmental protection and social responsibility. Shortages of fossil fuel energy increased attention on energy saving (conservation) and alternative energy to an unprecedented height. From 2010 the emergency brake of "coal chemical industry" by the country to the "Coal Chemical Industry Development Policy" and "Long-term Coal chemical Industry Development Plan" of the Chinese government, the state policies encouraging the development of new coal chemical industry continues recent attention towards a broader development blueprint for China's development of the new coal chemical industry utilizing China based natural resources.

The coal chemical industry is an important component of China's chemical industry. Regarding the new situation of coal chemical industry development, it is a big focus involving the overall development of the coal chemical industry to research coal chemical industry trends, study the alternatives of coal chemical for petrochemical and other traditional energy, and to discuss China's coal chemical industry development strategy, model and approach. Information provided belowanalyzes industry characteristics and trends from the macro (world, national) and micro (industry) levels in order to provide views on investingand construction of the industry in the future.

Macro Environment Analysis

至 2012 年，中国约有 60 家以上大型煤化工工厂，共有商业化运行的大规模气化装置约 230 套，采用的气化技术主要为鲁奇、德士古、壳牌、 GSP 、西北化工研究院、华东理工大学、航天气化、盈德 - 清华等工艺技术，原料是煤、渣油等，主要产品是化肥、甲醇、 MTP/O 、甲醚、 SNG 、合成油、乙二醇等。煤气化技术是煤化工产业化发展最重要的单元技术。近 20 年来，我国主要关注的是高品质的燃料原料，主要引进的气化技术为鲁奇、德士古、 SHELL 、 GSP 等。

By 2012, there are more than about 60 large coal chemical plants in China, a total about 230 sets of large-scale commercial operation gasification devices, mainly using Lurgi gasification technology, Texaco, Shell, GSP, Northwest Chemical Research Institute, East China University of Science and Technology, HTL, Yingde - Tsinghua and other technologies with raw materials of raw coal, residual oil, etc. The main products are fertilizers, methanol, MTP/O, ether, SNG, synthetic oil, glycol. Gasification technology is the most important cell technology of coal chemical industry development. The major gasification technology introduction in China is Lurgi, Texaco, SHELL, GSP, etc. during the past 20 years focused primarily on higher quality fuel feedstocks.

The "11 ^th Five-Year Plan" has made overall strategy for energy development in China clear: "persist on conservation, domestic-based, coal-based, diversified development and optimize production and consumption structure, build a stable, economical, clean and safe energy supply system". It is an opportunity for development of coal to chemical conversion projects that impels the chemical industry is to pursue maximizing the use of domestic Chinese resources, and sustainable development of a national economic strategy in which the coal chemical industry will occupy an increasingly important position in the long-term future development.

From the point of view of energy structural stability, there is considerable gap between China's oil and gas per capita reserves with the global average. Regarding the reserve-production ratio, the energy sustainability of China is also very poor, and if thereareno major oil fields found in the next 10-20 years, oil resource bottlenecks will threaten domestic energy security. The coal resources areclose with the world average.Chinahas a comparative advantage, in which China will relyon coal for the long term. In the "11 ^th Five-Year" period, from 2006 to 2020, China will spend 1 trillion RMB to develop coal to chemical projects, which accounts for 50% of equipment, 10% of technology. Coal to methanol, DME, olefins and oilwill be a critical focus of investment over the next 15 years. The direction will change from the traditional coal chemical to the modern coal chemical.

From the point of view of economic stability, the International Energy Agency (IEA) made ​​a study showed that if the price of oil rose $ 10 per barrel, that will cause China's real GDP to fall 0.8%, the inflation rate will rise 0.8%. Although a small proportion of oil energy in China, the use coal to manufacture chemicals to reduce consumption and dependence on imports of oil is an inevitable choice to stabilize China's economic development.

In 2006, the vigorous "environmental crisis" awakened awareness for social responsibility regarding environmental protection and safety. From the point of view of environmental protection, after using clean coal gasification technology, coal chemical industry energy integration model can effectively help solve the sulfur dioxide and greenhouse gas emissions from conventional power plant operations. Ecological balance and environmental capacity are the critical points of consideration of the future development of coal chemical industry. Coal to oil is fundamentally changing one natural resource into another . Production of one ton of oil requires about four tons of coal and ten tons of water. There is a lot of pressure on regional water resources and excessive water consumption may lead to ecological imbalances which is contrary to the principles of sustainable development of the current national strategy, and is also an important limiting factor of coal chemical industry development. It is expected in the near future that the project's water-efficient technology is an important value driver for the industrial R & D and project investment.

As China's coal and water resources reserves are consumed, then water balance and water-saving technology must be considered when planning coal chemical projects. Regarding water distribution, Shanxi and Ningxia is not suitable for large-scale development of coal chemical industry, and Guizhou, Inner Mongolia,Yunnan, Shaanxi and other areas should be policy tilted regions. Therefore, coal to oil cannot be theonly targeted use of the country's strategic reserves, and should not be the sole large-scale promotion direction of the industry. The NDRC is likely to set water resources limit as a key criteria for the coal chemical industry.

There are several advantages in developing coal chemical industry: First, from the strategic considerations, the government would increase the access threshold to avoid blind investment. But to encourage the innovation of alternative energy technology and equipment, it will offer concessions to enterprises in the industry;the forerunners may secure benefits and maintain the long-term advantage. Second, coal chemical cost is much lower than petrochemical products, which has strong economic feasibility. Third, coal chemical technology can reduce carbon dioxide emissions. If it can reduce water consumption, then it is possible to substitute petrochemical products. Fourth, domestic enterprises have accumulated and reserved related technologies, they can build the core competitiveness through technological innovation and change for high-end petrochemical products. Fifth, because of the high construction costs of coal chemical but the good prospects,itcan attract a lot of private and foreign capital investment, lower the liquidity or working capital requirements, and improvethe domestic economic and employment environment.

Chemical processing of coal includes coking, gasification and liquefaction. Coal coking in the metallurgical industry and coal gasification for ammonia are the traditional coal chemical industryproducts. With continuous economic progress, they will be further developed. Meanwhile, for the primary purpose of clean energy, coal liquefaction, coal-based alternative liquid fuels, and coal gasification - power generation or coal chemical energy technologies are also causing growing concern and will become the main development direction of new coal chemical industry. Development of the new coal chemical industry has great significance in the industrial sector and integrated development of the coal industry.

"Coal Chemical Industry Development Policy" and "Long-term Coal Chemical Industry Development Plan" have been finalized.

The fundamental spirit of coal chemical industry development policy is: steady promotion of industrial development, the continuous development of coal chemical industry, ease tensions of oil supply; scientific development planning, promote regional balance of coal production and sales, encourage coal chemical industry development in adjacent area to coal resources, appropriate arrangements for coal chemical project construction in coal supply area, restrict the coal chemical industry development in coal transferred area; coordinate the development of coal and related industries, especially the coordinated development with water resources; coal chemical Industry must adhere to the principle of circular economy, pursuelarge-scaleprojects to develop an open industry chain; strengthen independent innovation, adhere to the principal of independent innovation policy, increase policy support to encourage the standardization of equipment offerings. From the above information, there will be very little investment growth in the traditional coal chemical industry, such as coke and fertilizer, which will be mainly based on technical retrofit, and the calcium carbide industry will even face with the possibility of cut-out.

Many researchers believe that the world has entered a diversified energy and chemical raw materials age. Different countries or regions should choose high-quality materials and technology based on the resource availability and economic development. The technology that uses coal as a raw material to produce chemicals and generate efficient and clean energy (electricity, fuel oil, etc.)through conversion will form aparallel competitive trend with oil and natural gas chemical,with the support of mature individual technology, coal chemical will experience new development opportunities.

China's coal chemical industry development will be based on taking advantage of resources, optimizing energy structure, especially on optimizing end useenergy structure, provide quality energy security for national economic development and social progress through clean, efficient techniques. Its future development has the following main features:

                                       i.           除发展传统的产品型煤化工（炼焦、合成氨）以外，将以市场为导向，发展以能源转化型为主的煤化工产业，建设能源转化型和产品联产型的综合煤化工厂，如煤炭液化、煤气化 — 合成燃料与化工产品或电力、热力联产等。

In addition to the development of traditional coal chemical products (coke, ammonia), it will be market-oriented, develop coal chemical industry of energy conversion, construct integrated coal chemical plants of energy conversion and product cogeneration, such as coal liquefaction, coal gasification - synthetic fuels and chemicals or electricity, heat generation, etc.

                                      ii.           规模大型化，采用先进技术。以全球经济一体化为背景，培育世界级煤化工大型企业，建立具有国际竞争能力的大型工厂，如百万吨级产品的大型煤化工厂。采用国内外先进技术和现代装备，清洁生产和提供清洁产品，如现代液化工程、先进的合成反应工程等。

Large-scale, advanced technology. In the context of global economic integration, foster world-class large coal chemical enterprises, establish large factories with international competitiveness, such as large coal chemical plant with megaton products. Using advanced technology and modern equipment,producecleanly and provide clean products, such as modern liquefied engineering and advanced synthesis reaction engineering.

                                    iii.           在新的煤化工产业发展中，企业将成为新技术发展的主体。企业投资开发先进技术用于技术更新和技术进步，同时注重新技术在国内外市场上的商品化。

In the development of new coal chemical industry, the enterprises will become the main body of new technologies development. The enterprises invest indevelopment of advanced technology for technological upgrading and progress, while focusing on commercialization of new technology in the domestic and oversea markets.

                                    iv.           有利于煤炭工业的产业结构调整，促进相关行业的技术联合，从而可拉动内需，为就业提供条件，具备先进技术的煤化工产业将获优先发展。

Conducive to industrial restructuring of the coal industry, promoting joint technology of related industries, stimulating domestic demand, providing the conditions of employment, coal chemical industry with advanced technology will be given priority for development.

With the development of market economy and integration of global economic, China's coal industry[especially large-scale coal enterprises] are constantly adjusting the industrial structure and product mix.The development of the coal chemical industry is one of the most important methods.

Coal gasification occupies an important position in coal chemical industry.

Development of advanced coal gasification technology is important for thecoal chemical industry. Currently, state authorities are developing a proprietary coal gasification technology, such as multi-nozzle water slurry gasification, dry pulverized coal entrained flow gasification, the domestic introduction of technology projects are being planned as well. Coal enterprisesshould developgasification technology based on the inclusion of advanced domestic and oversea technology,and develop or use appropriate technology and enhancethrough technical& economic research, such as pressurized fixed-bed gasification and liquid slagging gasification combing the coal type, coal characteristics.

Conventional coal gasification technology development is mainly in the chemical industry. The coal industry is currently relatively weakin research and development, project implementation, and personnel expertise. There is a need to accelerate the improvement of integrated domestic capabilities.

Existing problems: First, the new coal chemical industry has the features of high investment, large consumption of resources and pollutant emissions; Second, China's coal resources and water resources render reverse distribution. Therefore, the national industrial policy strictly controlsthe project construction in net coal transferred district and encourages the development of coal chemical industry in adequate water resources and rich coal resources areas. China's Xinjiang, Guizhou, Yunnan and Inner Mongoliaarefour provinces rich in low-qulaitycoal resources. They have relatively abundant water resources, so thesefourprovinces are more suitable to developthe coal chemical industry.

Risk: technical risks, market risks and industrial policy risks of new coal chemical

                                       i.           技术风险：我国煤化工仍处于经验积累阶段。间接煤制油技术支撑系统还没有完全成熟，另外目前工业化示范项目规模仅 160-180kt/a 。大规模工业化装置扩大产能存在风险，包括催化剂活性、选择性，催化剂的使用寿命、乙二醇的收率及装置的稳定性等方面仍存在问题；煤制天然气虽然在美国有成功运行经验，但在我国许多问题仍需在实践中解决。

Technical risks: China's existing coal chemical industry is still in the stage of accumulating experience. Indirect coal to oil technology support systems are not fully mature. In addition, the current industrialization demonstration project scale is only 160-180kt/a. There is a risk to expand production capacity in large-scale industrialization equipment including problems with catalyst activity, selectivity, catalyst life, glycol yields and stability of the coal conversiontoglycol. There is successful operating experience of coal to gas projects in the United States, but in Chinathereremain numerous issues to be resolved in practice.

                                      ii.           市场风险：

Market risks:

First, the new coal chemical process can consume large volumes of coalfeedstock. Therefore coal costs account for a higher proportion of syngas production costs. The availability of inexpensive (hence lesser quality) coal resources is importantforcoal chemical projects to be successfully developed.

Second, the Middle East region has abundant and cheap light hydrocarbon resources, the olefinwith low carbon cracked by such raw materials has a low cost; thus,the price of polyolefin, glycol and other downstream products derived from such olefin is more competitive than domestic products even adding shipping, customs duties and other charges. Therefore, new domestic coal chemical products not only have to face competition from domestic petroleum products, but also need to respond to Middle East product competition.

Third, in addition to coal to oil, other types of new coal chemical projects are in planning, are already under construction,or are beingproposed.If successfully implemented, the production capacity of the industry will be enhanced, which will likely increase the presence of numerous coal to syngas to chemicals such asammonia/urea, methanol and DME.

Fourth, the domestic market of coal chemical products is mainly distributed in the eastern coastal areas, especially in eastern and southern China.The new coal chemical projects are mainly in the western regions with rich coal resourceswhichwill increase products’ logistics costs. For coal to natural gas, gas pipeline logistics are a big constraint.

                                    iii.           政策风险：

Policy risks:

First, taxes concerning China's carbon emissions and environmental aspects hasnotyet been levied.Onceatax is levied, it will greatly increase the cost of coal chemical projects. For example, for coal to oil projects, if carbon capture and storage (CCS) technology is implemented, then capital costs will increase by an estimated 15%. Coupled with environmental taxes, water resource charges, and the ecological compensation tax of western region resource development, then the cost will be higher.

Second, local governments and enterprises is developing coal chemical projects actively, but it may be conflict with the national pollutant emissions and water consumption policy set by the countryandresult in the project being canceled.

                                    iv.           国家产业政策：由于煤化工行业存在的问题及风险，国家政策对于发展煤化工项目的态度越来越审慎，先后出台了多个产业政策，规范、引导我国煤化工产业有序地发展。其中最新的是《煤炭深加工示范项目规划》（简称《规划》）和《煤炭深加工产业发展政策》（简称《政策》）。《规划》在全国确定了包括鄂尔多斯 3Mt/a 煤制二甲醚项目在内的 9 个省区 15 个示范项目；《政策》则对 “ 十二五 ” 煤炭深加工示范项目能效和资源消耗指标提出了更为严格的要求。

The national industrial policy: Because ofthecoal chemical industry issues and risks, the national policy for the development of coal chemical projects is increasingly cautious and has introduced a number of industrial policies, regulations guiding China's coal chemical industry to develop the sector in a methodicalmanner. The latest of which was "coaldeep processing demonstration project planning" (the "Plan") and the "industry development policy of coal deep processing" (the "Policy"). The planconfirmed15 demonstration projects in 9 provinces including Ordos 3Mt/a coal-DME project; the policyproposed more stringent requirements of energy and resource consumption indicators on the "12 ^th five year" coal deep processing demonstration projects.

China is a world leader in the coal chemical industrial sector. The coal chemical industry has the features of high investment, large coal and water consumption and pollutant emissions. Many new coal chemical technologies are first deployed in China. The increasing coal pricesand logistics costs,carbon taxes, environmental taxes, etc. will lead to an increase in costs in new coal chemical industry. Massive release of future domestic production capacity and low-cost products from the Middle East will impact project economics.

In summary, during the "12 ^th Five year" period, there are insufficient objective conditionsfor developingthe domestic large-scale new coal chemical industry, it is important for the Chinese economy to build higher level pilot demonstration projects relying on scientific and technological innovation.

Competition status

Main competitors: there arenumerous large-scale modern coal chemical projects currently being constructed. The core unit of the projects remains the gasification section. There are more than 10coal gasification technologiesthat have been applied domestically, the details as follows:

国内主要煤气化技术一览表 /List of major domestic coal gasification technology

Competitiveadvantagesand market positioning:

U-GAS® is especially suitable for low-quality &low-cost coal and biomass, such as lignite, sub-bituminous coal, peat, etc. Therefore, U-GAS® gasification technology is very suitable for developing large coal chemical projects in Inner Mongolia, Yunnan, Xinjiang, Ningxia, Shaanxi, Qinghai, Guizhou and other regions with low-quality coal feedstocks;

Environmentally friendly process produceswaste waterthat does not contain tar, phenol and other impurities.The processing cost is very low, while alternative gasification technologies contain a large amount of tar oil so theirwaste water treatment process is complicated and costly;

Water consumption in the production process is lower than other gasification technologies. This makes our technology particularly suitable for use in Inner Mongolia, Xinjiang and other regions lacking of water and where waste waterdisposal cannot be easily managed;

Mostequipment components can be produced domestically, without cumbersome coal preparation system and subsequent sewage treatment equipment. Compared with alternative coal gasification technologies, the SES technology presents a favorable capital cost advantage;

Methane content is higher than other gasification technologies, highly compatible with the Chinese government’s requirements for clean and efficient utilization of coal feedstock, especially for coal to gas projects to help mitigate air pollution from heavy reliance upon coal burning power generation stations.

Marketing strategy, sales channels, sales targets

Conduct marketing by using an existing large customer base,good relationships and an existing credit channel already built by ZCM in the country;

Use the client resources built up by SES over the years to further develop sales channels and offer site tours when possible of existing operational assets in either China and/or Chicago, Illinois in the United States;

Sales target is the large coal chemical projects approved by the country, coal chemical transformation projects (i.e. for examplecoal to syngas to ammonia for fertilizer production);

At the early stage of the promotion of the project, may use loans, financing, existing China banking and investment institutional relationships,and other means to assist in obtaining project customers by providing as comprehensive (one-stop shopping) customer solutions as possible.

五、公司发展战略/ Company Development Strategy

发展理念、思路、步骤

Development Steps

1-2 year overview: Based on the U-Gas technology, utilizing a partnership approach to serve customers with a packaged solution coveringtechnology, funding, marketing, equipment fabrication, engineering and human resources. Consideringthe current government preferential policies on clean and efficient coal processing of domestic Chinese resources, the JV will develop the China market first, steps as below:

Assist SES on the existing 0.2 MPa (ZZ plant) and 1.0 MPa(Yima) facilities, when and if SES so requests, to make sure the plant can operate reliably, in accordance with expectations, and in a viable manner.Final Technical acceptance of Yima as soon as possible is to be emphasized. After the final Yima technical acceptance, the JV will be able to use successful commissioning of Yima to further promote the implementation of U- Gas technology.

Complete the existing *** MPa PDP and apply it in a commercial project.

Retain existing human resources as selected from SES and hire additional experienced technology and business development personnel to continue building a highly competitive team.

*** This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

Develop the Vietnam, Indonesia, Philippines and Malaysia markets for which SES already has several project concepts under discussion (for example, Pertiminain Indonesia).

Explore more overseas cooperation opportunities with SES and develop more business verticals such as DRI and Power Generation(for example, SES relationship with GE power generation divisions and various Indian steel manufacturers).

Target to complete minimum 2~3 projects in the first 18 months.

The JV will, within the first year of establishment, seek to have the SES Gasification Technology endorsed by the China central government.

Medium target in next 2-4 years:

Further improve the design qualities of the U-GAS® technology;

Stable, reputable, and mature team and technical service;

Yearly schedule – targeted installations:

Mature and stable growth earning ability;

*** This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

Achieve sufficient growth and market reputation to develop the option to conduct an initial public offering or sale of the Joint Venture to a larger balance sheet capable entity.

Long term target>5 years

U-Gas gasification technology to become the major technology supplier in the market, offering three product qualities:

Acquire an EPC certification and other relevant quality control certifications.

Develop the JV into a high technology company with comprehensive chemical technology R&D center and design engineering construction capability.

Become a reputable, competitive, and profitable international engineering technology company.

Sustainable earning ability and investment and funding relationships (banks and investment institutions) to bring to customers as an additional value proposition.

六、风险分析 /Risk Analysis

Possible risk factors include government policy changes, management retention, commodity markets (electricity, chemicals, etc.), construction, capital cost, political, currency exchange rates, customer credit, etc.:

The risks as mentioned above are typical risks all enterprises must manage;

U- GAS® technology currently lacks a commercially operating project for high pressure gasification 。

Risk Mitigation

China’s energy consumption structure is heading towards consumption of domestic resources in a clean and cost effective manner. Hence clean coal gasification technology is a strategic focus of China in the near future for sustainable power, natural gas and chemical production.

The JV is a jointly owned limited liability company in compliance with corporate governance rules. The technology, Intellectual Property, accounting and financing control systems are all setup following relevant laws and regulations.

SES will continue to pursue the final technical acceptance of the gasification installation at the Yima project.

U-GAS®technology is a proven, workable process with actual sites allowing for visual inspections by prospective customers.

Setup an efficient scientifically proven and market orientedcustomerstrategy.

Fully utilize the related governmental industrial policies providing for preferential treatment of new technologies offering competitive and clean fuel conversion processes..

A professional, proven, and competitive team is targeted using SES and ZCM staffing resources.

ZCM will employ its advantage’s concerning equipment manufacture for the JV. The objective being to provide low cost and high quality customer service and improve the competitiveness and ultimate valuation of the JV.

Manage operating costs while maximizing market presence and reputation.

Combine the advantages of both ZCM and SES and create higher shareholder value for both entities.

附件 2 - SGT 技术资料

Annex 2 - SGT 技术资料

根据 SESHK 与张化机的合资协议，本次合资 SESHK 将提供如下资料：

According to the JV contract between SES and ZCM, SES will provide following materials:

1. 义马项目 PDP 设计（ 1.0MPa ） 2

PDP design of Yima project (1.0MPa) 2

2. 枣庄项目 PDP 设计（ 0.2MPa ） 3

PDP design of Zaozhuang project (0.2MPa) 3

3. 通用高压（ ***MPa ）气化装置 PDP 设计 5

Generic PDP design of high pressure gasification unit (***MPa) 5

4. 气化模型及计算软件描述 5

Gasification model and calculation software description 5

5. 枣庄及义马工厂操作数据 5

ZZ & YM Plant operating data 5

6. 枣庄工厂试烧报告 5

Coal testing reports of ZZ Plant 5

7. 枣庄及义马工厂操作手册 6

ZZ & YM Plant operating manual 6

8. SES 分析研究报告 6

SES Analysis Report and Research Report 6

9. SGT 性能保证机制及保证值 8

SGT performance guarantee mechanisms and the guaranteed value 8

10. 义马项目工程询价资料 8

Yima Project engineering quotation material 8

11. 专有设备图纸及目录 9

Proprietary equipment drawings and catalog 9

12. SES 专利及目录 9

SES patents and catalog 9

13. 专有技术（技术诀窍）描述 9

Description of Proprietary technology (know-how) 9

14. SGT 的完整性（ SESHK 注入到合资公司的 SES 气化技术的完整性） 10

The Completeness of SGT (the completeness of SES gasification technology injected into the joint venture by SESHK) 10

*** This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

各项所包含的内容简述：

Brief description of each item:

PDP design of Yima project (1.0MPa)

Control Description, including

***

***

***

***

***

***

***

*** This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

Cyclone Report: Contains SES study report on ZZ Plant’s cyclone system, especially on the 2nd stage cyclone; and the PSD (particle size distribution) tested by Shanghai Research Institute of Chemical Industry of fines captured by the bag house during YM coal test.

Project Management

Yima project start reporting RevB

Yima project organization structure and management documents

Risk Assessment of Yima PDP Rev F

Schedule of Yima PDP

Contact info of Yima PDP team 20090615

Drawings and document templates

Material balance

Meeting notes

Preliminary design basics for reference

Preliminary design documents of East China Engineering Company

Device Process Description

Model Review of Yima PDP

Yima PDP documents

（1）                  工艺

Technology

（2）                  设备

Equipment

（3）                  仪表

Instrumentation

（4）                  管道、电气、 HSE

Piping,Electrical,HES

Yima PDP in bilingual

注：根据义煤集团要求， SES 所提供的文件深度及范围超出《石油化工装置工艺设计包（成套技术工艺包）内容规定》 SHSG-052-2003 标准，同时，提供备煤工段的设计包，义煤集团支付相关费用。

Note: According to Yima Coal Industry Group’s requirements, the depth and scope of the documents provided by SES beyond "petrochemical plant process design package (set of technologies technology package) content requirements" SHSG-052-2003 standard, while SES provided the design package of coal preparation section as well, and Yima Coal Industry Group paid for related fees.

Print copy of Yima Technical Licensing Contract

PDP design of Zaozhuang project (0.2MPa)

PFD

Material balance

PID

Process Description

Equipment list

Meter list

Key equipment data sheets

Equipment layout

Gasifier interlock list

Operation Manual

PDP file permissions

Frequently used Document templates

ZZ retrofit projects materials

TT Project Application Form

Material list

Retrofit project

Project document template

Font files

Project design conditions management guide

2007NEWBLANKnew.dwg

design Dep.org.chart.xls

project list.xls

SES engineering.xls (SES engineering dept name list)

High efficiency cyclone technology agreement 20081114 Luo.pdf

Engineering design modification approval process20080520.doc

TT Project application form

Contact form of Shanghai Keyuan

Design change form

Designers registration form

Generic PDP design of high pressure gasification unit (***MPa)

包含整套 4.0MPa 气化系统的第三版的 PDP 设计文件

Containing the entire third edition of the PDP design file of ***MPa gasification system

Technology

Equipment

Instrumentation

Piping installation

Piping installation and Operating Guideline

Gasification model and calculation software description

Model calculation manual;

Gasification model of ZZ, YM, High pressure PDP;

All gasification model completed by SES;

Name and version requirements of the process simulation calculation software and stress calculation software

ZZ & YM Plant operating data

Operating data from September 2010 to September 2011 of ZZ Plant

Operating data of YM Plant

Coal testing reports of ZZ Plant

***

***

***

***

***

*** This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

ZZ & YM Plant operating manual

Gasification section operation manual of ZZ Plant (including analysis and maintenance documents, etc.)

Gasification section operation manual of YM Plant (including analytical manual, maintenance manual, etc.)

SES Analysis Report and Research Report

***

JQ-HCI1012182QD-01(water sample)(waste water analysis)

JQ-HCI1012182QD-02(water sample)(waste water analysis)

JQ-HCI1012182QD-03(water sample)(waste water analysis)

JQ-HCI1012182QD-04(water sample)(waste water analysis)

JQ-HCI1012182QD-05(water sample)(waste water analysis)

JQ-HCI1012182QD-06(water sample)(waste water analysis)

*** This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

JQ-HCI1012182QD-07(water sample)(waste water analysis)

JQ-HCI1012182QD-08(water sample)(waste water analysis)

JQ-HCI1012182QD-09(water sample)(waste water analysis)

JQ-HCI1012182QD-10(Gas)(gas analysis)

JQ-HCI1012182QD-11(Gas)(gas analysis)

JQ-HCI1012182QD-12(Gas)(gas analysis)

***

***

***

***

***

pall test (Imported ceramic filter dust particle size distribution)

High efficiency cyclone dust concentration measurement report 006

High efficiency cyclone dust concentration measurement report

lignite 4 # bag particle size analysis 09.10.18

First cyclone dipleg dust particle (U.S. laser particle analyzer)

Coal test analysis reports

20091013 Lignite Analysis Report_ Coal Research Institute

***

***

*** This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

Yima Stress Analysis

FEA report on distributing plate of GASIFIER_0828

YM gasifier parts finite element analysis conditions(Chinese)2012-01-09

Gasifier distribution plate finite element analysis_ Technical consulting contract

Quotation for stress analysis of head takeover on the gasifier shell

SGT performance guarantee mechanisms and the guaranteed value

Yima plant performance guarantee documents

SES performance guarantee mechanisms

SGT 性能保证的提出是基于大量的模型计算以及工程经验而得到的；是建立在 SGT 专有技术（技术诀窍）基础上的；是与专有设备结构尺寸紧密相关的；同时，还应该正确的操作运行。 SGT 性能保证的提出是以上各项的有机结合。

SGT performance guarantees is proposed based on a large number of model calculation and engineering experience; is built on the basis of SGT proprietary technology (know-how); is closely related with the proprietary equipment structure size; at the same time, it should be operated properly. The proposed SGT performance guarantee is an combination of the above.

以义马项目为例， SES 共对基准煤种进行了 21 种工况的模型计算，从中找出各方面最不利工况，将其值做为性能保证值，以确保 SGT 能够在各种条件下均不超出保证值的限制。

Take Yima project as an example, SES conducted model calculations of the benchmark coal in a total of 21 kinds of conditions, to find out the most unfavorable conditions of various aspects, and make it as the performance guaranteed value to ensure that SGT will not exceed the limit of the guarantee values under all conditions.

SGT 模型计算与专有设备（气化炉）的尺寸是紧密联系的，因此， SGT 气化炉能够满足基准煤几乎所有的气化操作条件，并且能够在任何条件下均能满足气体成分、气量、消耗、转化率的要求。一般技术许可项目在以下几个方面提供保证： 单炉产气量；底渣含碳量，碳转化率，煤耗，氧耗， CO+H2 在干气中的含量，甲烷含量， 72 小时的运行负荷保证。

SGT model calculation is closely related with the size of proprietary equipment (gasifier), and therefore, SGT gasifier can satisfy almost all gasification operating conditions of the benchmark coal, and can meet the requests of gas composition, gas volume, consumption, conversion rate under all conditions. Generally, technology licensing program is guaranteed in the following aspects: single-furnace gas production; bottom ash carbon content, carbon conversion rate, coal consumption, oxygen consumption, CO + H2 content in the dry gas, methane content, 72-hour operation load.

Yima Project engineering quotation material

YM gasifier shell surface temperature detector specifications

Gasifier

Gasifier internals

Gasifier refractory tender documents

The burner

Cyclone

Proprietary equipment drawings and catalog

Proprietary equipment drawings of Yima project

Cyclone

YM gasifier drawings (gasifier + castable)

Internal parts

Ash discharge pipe and central jet (including nozzle parameters)

L valve

Gasifier

HRSG

Ash discharge segment

Cyclone

SES patents and catalog

Including SES patent list and Introduction

Description of Proprietary technology (know-how)

Including rage of proprietary technology (know-how), description of proprietary technology (know-how):

SGT 来源于 GTI U-Gas 气化技术， U-Gas 气化技术经过 SES 的工程实践，以及不断摸索，开发了适合于多种煤质的气化技术，并形成了具有自身特点的专有技术（技术诀窍）。

SGT is from GTI U-Gas gasification technology, through SES’ engineering practice and continuous explore, U-Gas gasification technology was developed for a variety kind of coal, and formed a proprietary technology (know-how)with its own characteristics.

SGT 专有技术（技术诀窍）包含（但不限于）以下各项：

SGT proprietary technology (know-how) includes (but not limited to) the following contents:

Business secrets;

PDP design, including model calculation, process, instrumentation control, equipment sizing and selection, equipment layout, etc.;

Design;

Design drawings;

Technical specifications;

Test data;

Graphs;

Manufacturing techniques;

Structure, materials;

Formulas, curves;

Operation and test procedures;

Operation guide / manual.

The completeness of SGT (the completeness of SES gasification technology injected into the joint venture by SESHK)

SESHK 负责 100% 提供截止至本合同生效时其拥有的 SGT （包括但不限于流程、数据、配方、物料平衡、控制逻辑、程序、说明、设计、草图、照片、企划、图纸、参数、报告、研究、发现等）。包括但不限于本附件所列的内容，针对本附件可能未列明的部分，在未来合资公司经营过程中 SESHK 也应无条件提供。

SESHK is responsible for providing 100% of SGT it owned before the Effective of this Contract (including but not limited to process, data, formula, material balance, control logic, procedure, instruction, design, sketch, photograph, planning, drawing, parameter, report, study, and discovery etc.), including but not limited to the contents of the annex, for the part which may not be listed in this Annex, SESHK should also provide to Company unconditionally during the Company operation.

ANNEX 3

DATED the XX day of Month 20XX

zcm-ses Sino-US Clean Energy tECHNOLOGIES CO., lTD.

and

NAME

________________________________________________________

TECHNOLOGY LICENSE AGREEMENT

_________________________________________________________