AAG Energy : 2022 SUSTAINABLE DEVELOPMENT REPORT

The Leading Independent Coalbed Methane Producer in China

Delivering sustainable shareholder returns

亞美能源控股有限公司

AAG Energy Holdings Limited

(Incorporated in the Cayman Islands with limited liability)

(於開曼群島註冊成立的有限公司)

Stock Code 股份代號: 2686

Contents 目錄

About This Report 2 ᗫ׵͉జѓ

Statement from the Chairman 3 ˴ࢩߧᗘ

Statement from the Board 5 ໨ԫึᑊ׼

About Us 7 ᗫ׵Ңࡁ

• 1. Sustainable Development Management 9 ̙ܵᚃ೯࢝၍ଣ

  • 1.1 ESG Management 9 ESG ၍ଣ

  • 1.2 Stakeholders Engagement 15 лू޴ᗫ˙ਞၾ

  • 1.3 Response to ESG Reporting Principles 17 ESG జѓࡡۆΫᏐ

• 2. Safe Production and Clean Operations 19 τΌ͛ପ ૶ᆎ༶ᐄ

  • 2.1 Consolidating the Foundation of Safe Production 21 ᖢոτΌ࣬ਿ

  • 2.2 Co-create a Green Environment 43

    ΍௴ၠЍᐑྤ

• 3. Stable Operation and Win-Win Cooperation 81 ᖢ਄༶ᐄ ΥЪ΍ᙊ

  • 3.1 Consistently Stable Supply of High-Quality Gas 81 ܵᚃ৷ሯᖢ֛Զं

  • 3.2 Integrity and Compliance 85 ਺ς༐ڦΥ஝

  • 3.3 Supporting Suppliers to Grow Together 88

    ԶᏐਠ΍Νϓڗ

• 4. People-oriented and Harmonious Development 90 ˸ɛމ͉ ձፓ೯࢝

  • 4.1 Respecting Employees' Rights and Interests 90 యࠠࡰʈᛆू

  • 4.2 Supporting Employee Development 93 пɢࡰʈ೯࢝

  • 4.3 Employee Care 99 ᗫฌࡰʈ͛ݺ

• 5. Benefiting Local Communities 103 ٟਜᗫᕿ

  • 5.1 Contributing to Rural Revitalization 104 пɢඊӀࣈጳ

  • 5.2 Building Community Together 106 ٟਜ΍௴

Index of the HKEX ESG Report Guideline 107 ᑌʹה ESG ܸᅺ॰ˏ

Feedback ᛘ٫จԈˀ㉿ڌ

About This Report 關於本報告

This report is a true reflection of AAG Energy Holdings Limited's ("AAG Energy" or the "Company") active fulfillment of its economic, social and environmental responsibilities to achieve comprehensive, coordinated and sustainable development. The forward-looking statements with respect to business plans and development strategies in the report do not constitute a substantial commitment of the Company to investors.

• • Time Period

  This report covers data from 1 January 2022 to 31 December 2022 with some contents out of this time range.

• • Scope of the Report

  This report includes AAG Energy and its subsidiaries.

• • Data Specifications

  All data was mainly sourced from official documents, statistical and financial reports of the Company, as well as the environmental, social and governance ("ESG") information collected from the Company's statistics, summaries and audits. This report is available in Chinese and English. If there is any conflict or inconsistency between the two versions, the Chinese version shall prevail. Unless otherwise stated, the currency used is the Chinese yuan ("CNY").

• • References

  This report was prepared based on the "ESG Reporting Guide" on Appendix 27 of the Guidelines For Listing Rules of The Stock Exchange of Hong Kong Limited ("Stock Exchange"). It also referred to the Sustainability Reporting Standards (GRI standards) issued by the Global Sustainability Standard Board (GSSB).

• • Reporting Specifications

  Throughout this report, AAG Energy Holdings Limited may be referred to as "AAG Energy", the "Company", "we", "us" or "our".

• • Access to the Report

  You can browse this report and dynamic information about the sustainable development activities of the Company from the "Sustainable Development" section on the homepage of the AAG Energy website (http://www.aagenergy.com/en-US/).

͉జѓ݊ԭߕঐ๕છٰϞࠢʮ̡€˸ɨᔊ၈˜亞 美能源™א˜公司™ጐ฽ᄵБ຾᏶eٟึձᐑ ྤப΂dྼତΌࠦ՘ሜ̙ܵᚃ೯࢝ٙॆྼˀ ݈fజѓʕהऒʿٙ຾ᐄࠇྌe೯࢝኷ଫഃۃ ᓼ׌౜ࠑʔ࿴ϓʮ̡࿁ҳ༟٫ٙྼሯוፕf

• • 時間範圍 ͉జѓʫ࢙ࣛගޢࠢމ 2022 ϋ 1 ˜ 1˚ Ї 12 ˜ 31 ˚d௅ʱʫ࢙൴̈ɪࠑᇍఖf

• • 報告範圍 ͉జѓᔧႊԭߕঐ๕છٰϞࠢʮ̡ʿڝ ᙮ʮ̡f

• • 數據來源 Ό௅ڦࢹᅰኽԸІʮ̡͍ٙό˖΁e୕ ࠇజѓၾৌਕజѓd˸ʿ຾͟ʮ̡୕ ࠇe ි ᐼ ၾ ᄲ ࣨ ٙ ᐑ ྤe ٟ ึ ʿ ၍ ط ڦ ࢹf జ ѓ ೯ б ʕe ߵ ˖ و ͉d ν Ϟ ʫ ࢙ ʔ ɓ ߧd ሗ ˸ ʕ ˖ و މ ๟f ν ೌ त ࣿ Ⴍ ׼d஬࿆ఊЗѩމɛ͏࿆ʩf

• • 編製依據

  ͉జѓਞ๫࠰ಥᑌʹה˴ؐɪ̹஝ۆ

  ܸˏ'ڝ፽ɚɤɖ˜ᐑྤeٟึʿ၍طజ

  ѓܸˏ™ආБᇜᄳdԨਞϽΌଢ̙ܵᚃ೯

  ࢝ᅺ๟։ࡰึ (GSSB) ೯бٙ GRI Standards

  ഃᅺ๟f

• • 指代說明 މک׵ڌࠑձ˙کቡᛘdԭߕঐ๕છٰ Ϟࠢʮ̡ίజѓʕٙڌࠑʱйԴ͜˜亞 美能源™e˜公司™e˜我們™א˜集團™f

• • 報告獲取 આ̙˸ίԭߕঐ๕છٰϞࠢʮ̡ژ˒ၣ १˴ࠫٙ˜̙ܵᚃ೯࢝™ᙷͦᓭᚎ͉జѓ ʿʮ̡Ϟᗫ̙ܵᚃ೯࢝ݺਗٙਗ࿒ڦࢹ €ၣѧjhttp://www.aagenergy.com/zh-CN/f

The year 2022 was a milestone year. The 20th National Congress of the Communist Party of China (CPC) mapped out a grand blueprint for building a modern socialist country in all respects and comprehensively promoting the great rejuvenation of the Chinese nation. The 20th CPC National Congress identified the Chinese path to modernization and defined the national task of high-quality development. Globally, COVID-19 was still pervading, climate change was worsening, and the international situation was turbulent... High-quality sustainability is still the common aspiration worldwide, especially when the economy, society and the natural environment are facing many challenges.

The oil and gas industry, as a basic industry related to the lifeline of the global economy and closely associated with people's livelihood, has been concerned by all parties. Featuring massive carbon emissions, complicated operating environment, and a long value chain in the oil and gas industry, the company are facing many challenges and opportunities in low-carbon transformation and business structure adjustment particularly in the context of climate change, energy transformation, and higher rules on ESG compliance.

AAG Energy always puts health and safety as top priority on the ESG agenda and has deeply explored a safe, stable and environmentally friendly enterprise model. As a leading coal-bed methane ("CBM") exploitation and development enterprise in China, AAG Energy continued to maintain a zero track record in 2022 with the joint efforts of all employees: zero record in total recordable incident rate ("TRIR"), zero record in lost time incident rate ("LTIR") and zero occupational disease incidence rate, and achieved an excellent safety performance with zero LTIR for 8 years and 117 days in a row.

As an excellent representative in China's CBM exploration and development industry, AAG Energy is committed to the development and utilization of high-quality unconventional natural gas resources. While ensuring product quality, the Company prioritizes stable gas supply, continuously improves service and technological innovation, and contributes to social stability and development. In 2022, AAG Energy CBM gross production continued to grow by 13% to 1.466

2022 ϋ݊ՈϞԢ೻຦จ່ٙɓϋdʕ਷௷л̜ කᙣٙɚɤɽdᏙ೥əΌࠦܔணٟึ˴່ତ˾ ʷ਷࢕d˸ʕ਷όତ˾ʷΌࠦપආʕശ͏ૄਃ ɽూጳٙ҃ਃᔝྡd׼ᆽə৷ሯඎ೯࢝ٙ਷࢕ ΂ਕf׳଻ΌଢdอڿޥઋԱᔚᇶַeंࡉᜊ ʷ̋ᄌe਷ყ҅ැਗᐗnnί຾᏶eٟึၾІ ್ᐑྤࠦᑗመεܿ኷ٙʦ˂d৷ሯඎ̙ٙܵᚃ ೯࢝ʥ್݊਷ʫ̮ٟึٙ΍Νಂ޸f

ذंପุЪމᗫڷΌଢ຾᏶նএٙਿᓾପุd ɦၾ͏͛ࢹࢹ޴ᗫdɓٜ˸ԸաՑ΢˙ٙᗫ ءfतй݊ڐϋԸdίंࡉᜊʷeঐ๕ᔷۨe ESG Υ஝ࠅӋʔᓙ౤ʺ̮ٙ௅ᐑྤɨdذंБ ุ৷၁રeЪุᐑྤልᕏeପุᗡૢڗഃतᓃ ഗʮ̡੭ԸəЭ၁ᔷۨeุਕഐ࿴ሜ዆ഃɓӻ ΐܿ኷ձዚ༾f

ԭߕঐ๕֐୞ਗ਼਄ੰτΌʈЪ׳ί ESG ʈЪٙ ࠯ࠅЗໄdଉɝઞ॰τΌᖢ֛eᐑྤʾλٙΆ ุᅼόfЪމ਷ʫჯ΋ٙ๩ᄴंਖઞක೯Ά ุdίΌ᜗ࡰʈٙ΍Νрɢɨdԭߕঐ๕ 2022 ϋ ܵ ᚃ ڭ ܵ ᐼ ̙ া ፽ ԫ ݂ ଟ€˜TRIR™eฦ̰ ʈ ࣛ ԫ ݂ ଟ€˜LTIR™e ᔖ ุ ष ೯ ष ଟ ѩ މ ཧ ٙᐶࣖা፽dଢ଼ࠇྼତ 8 ϋཧ 117 ˂ೌฦ̰ʈ ࣛԫ݂ٙτΌุᐶf

ԭߕঐ๕Ъމʕ਷๩ᄴंਖઞක೯ٙБุՙ൳ ˾ڌd֐୞৛Ӌ৷˥๟ٙڢ੬஝˂್ं༟๕ක ೯л͜dίᆽڭପۜሯඎٙۃ౤ɨd˸ᖢ֛Զ ंމ࠯ࠅ΂ਕdܵᚃ౤ʺ؂ਕሯඎၾҦஔ௴อ ঐ ɢd މ ٟ ึ ᖢ ֛ ೯ ࢝ ্ ᘠ І Ԓ ɢ ඎf2022 ϋd ԭ ߕ ঐ ๕ ๩ ᄴ ं ᐼ ପ ඎ ޴ ༰ 2021 ϋᘱᚃ ڭ ܵ ᄣ ڗd Ν ˢ ᄣ ڗ ߒ 13% ༺ 14.66 ᄂͭ˙Ϸ

billion cubic meters (51.8 billion cubic feet) from last year, including €у 518 ᄂͭ˙ߵˉdՉʕܼ̍ᆙ୿ਜ෯ٙᐼ

1.182 billion cubic meters (about 41.7 billion cubic feet) in Panzhuang concession and 284 million cubic meters (about 10 billion cubic feet) in Mabi concession. We continue to enhance the supply chain management system by managing suppliers' ESG risk in the full-life cycle and guiding suppliers to fulfill their social and environmental commitments which driving the coordinative development of Company's value chain and partners, and boosting the sound development of the business ecosystem.

ପඎ 11.82 ᄂ ͭ ˙ Ϸ€ у ߒ 417 ᄂ ͭ ˙ ߵ ˉ ձ ৵̀ਜ෯ٙᐼପඎ 2.84 ᄂ ͭ ˙ Ϸ€ у ߒ 100 ᄂ ͭ˙ߵˉfҢࡁܵᚃҁഛԶᏐᗡ၍ଣ᜗ӻd ίΌ͛նմಂ࿁ԶᏐਠٙ ESG ࠬᎈආБ၍ଣd ጐ฽ˏኬԶᏐਠᄵБٟึʿᐑྤப΂d੭ਗʮ ̡ᄆ࠽ᗡʿΥЪ͹М΍Νϓڗdપਗุਕ͛࿒ ਸ਼Ԅ׌೯࢝f

AAG Energy attaches great importance to climate change and energy challenges and proactively responds to the national strategic goal of carbon peaking by 2030 and carbon neutrality by 2060. While continuously and stably producing clean energy, the Company issues a series of goals, strategies and actions to address climate change. The Company uses energy more efficiently and enhances environmental management, practices the low-carbon operation strategy, and explores the way to utilize renewable energy. While facilitating the value chain to transform towards being environment-friendly and low-carbon so as to be the stable supplier of energy for society and the promoter of the low-carbon transformation towards clean energy.

AAG Energy upholds the concept of thriving with talent, and protects the rights of employees with a professional and effective talent training system, equal and diverse talent platform and open and fair career paths to timely respond to the needs of employees. The Company is committed to building an equal, inclusive and harmonious working environment to grow with talents. We participate in public charities, fulfill corporate social responsibilities, and provide assistance to society within our scope. We provided about 63.03 million cubic meters of affordable gas for domestic use to Jincheng throughout the year, about 2.93 million cubic meters of free gas supply to the residents nearby, about 219 million cubic meters of high-quality but affordable industrial gas to the local area of Jincheng, and about 118 million cubic meters of gas supply to Shanxi in winter when heating are needed. In total, we provided about 402 million cubic meters of high-quality but affordable gas to the local area, equivalent to about RMB200 million of profits we shared, making a significant contribution to the local economy.

Step after step the ladder is ascended. Upholding the vision of "inspiring to be the world's leading, most enduring clean energy company", AAG Energy firmly practices the path of green, low-carbon, inclusive and sustainable development, and strives to become an innovative company that creates greater value for the society with its responsibility. In the future, AAG Energy will work with its industrial chain partners to focus on the development and value optimization of unconventional natural gas resources. We will continuously supply clean energy for China's economy, and take huge responsibility for China's sustainability.

ԭߕঐ๕৷ܓࠠൖंࡉᜊʷձঐ๕ܿ኷dጐ฽ ᚤ Ꮠ ਷ ࢕˜3060 ᕐ၁™኷ଫͦᅺfίܵᚃᖢ֛ ፩̈૶ᆎঐ๕ٙΝࣛdપ̈ɓӻΐᏐ࿁ंࡉᜊ ʷٙͦᅺe኷ଫձБਗdʔᓙ੶ʷІԒঐ๕Դ ࣖ͜ଟၾᐑྤ၍ଣঐɢdଉɝስБЭ၁༶ᐄ኷ ଫdઞ॰̙Ύ͛ঐ๕Ꮠ͜௄ࢰdпɢΌᄆ࠽ᗡ ٙᐑڭЭ၁ᔷۨdنਂٟึঐ๕ᖢ֛ԶᏐٙς ᚐ٫e૶ᆎঐ๕Э၁ᔷۨٙપਗ٫f

ԭߕঐ๕٢וɛʑጳΆٙ၍ଣଣׂdίʲྼڭ ღࡰʈᛆूٙਿᓾɪdܵᚃܔͭਖ਼ุϞࣖٙɛ ʑ੃ቮ᜗ӻd̻ഃεʩٙɛʑ̨̻d࿫ஷʮ̻ ٙ೯࢝༩ࢰdʿࣛᚤᏐࡰʈცӋdߧɢ׵࿴ܔ ̻ഃe࢙̍eձፓٙʈЪ؟ఖdྼତɛʑၾʮ ̡΍ϓڗfҢࡁጐ฽ҳԒʮूԫุd˴ਗᄵБ Άุٟึப΂dމٟึ౤ԶɢהঐʿٙᏍпf ҢࡁΌϋމࣜ۬຅ή্ᘠกᄆ͏͜ंߒ 6,303 ຬͭ˙Ϸdމʮ̡մᗙ֢͏е൬Զंߒ 293 ຬ ͭ˙Ϸdމࣜ۬຅ή౤ԶᎴሯกᄆʈุंߒ 2.19 ᄂͭ˙Ϸdમา֙ڭԶʆГΌ޲ंඎߒ 1.18 ᄂͭ˙ϷdΥࠇމ຅ή౤ԶᎴሯกᄆंඎ ߒ 4.02 ᄂͭ˙ϷdұΥΣ຅ήᜫлߒ 2 ᄂʩɛ ͏࿆dމ຅ή຾᏶ܔணਂ̈ࠠɽ্ᘠf

ጐ▮Ӊ˸ЇɷԢdጐʃݴ˸ϓϪऎf˸˜Ꮈқ ϓމ਷ყჯ΋ٙ͑ᚃ೯࢝ٙ૶ᆎঐ๕ਃɽΆ ุ™މ̙ܵᚃ೯࢝ᗴ౻ٙԭߕঐ๕dਗ਼਺֛ስ БၠЍЭ၁e౷౉࢙̙̍ٙܵᚃ೯࢝ʘ༩d˸ ІԒٙப΂ዄ຅dрɢϓމɓ࢕މٟึ௴ிһ ɽᄆ࠽ٙ௴อۨΆุfࠦΣ͊Ըdԭߕঐ๕ਗ਼ ձପุᗡΥЪ͹Мᙳৎ˓Ըdਖ਼ء׵ڢ੬஝˂ ್ं༟๕ٙක೯ʿᄆ࠽Ꮄʷdމʕ਷຾᏶ԶᏐ ૶ᆎঐ๕dމʕ਷̙ٙܵᚃ೯࢝࣎ᑐዄ຅f