FGS and G7 launch new commercial logistics vehicles fuel solutions that combine operational efficiency and carbon neutrality

Rhea-AI Summary

Recon Technology, Ltd (NASDAQ: RCON) announced the expansion of its cooperation with Hui Tong Tian Xia Petrochemical to launch new industry logistics solutions aimed at enhancing fuel management efficiency and promoting carbon neutrality. The agreement follows a previous partnership established in July 2021 and emphasizes addressing substantial fuel costs in China's logistics sector, projected at RMB280 billion in Q1 2022. The venture aims to develop a comprehensive online fuel management platform, leveraging G7's technologies to improve operational efficiency and sustainability in the logistics industry.

Positive

• Expansion of cooperation with Hui Tong Tian Xia Petrochemical to enhance fuel management solutions.
• Focus on carbon neutrality aligns with national sustainability goals, potentially attracting environmentally conscious clients.
• Plans to develop a nationwide online fuel management platform could streamline operations and reduce costs for logistics companies.

Negative

• None.

BEIJING, Sept. 12, 2022 /PRNewswire/ -- Recon Technology, Ltd (NASDAQ: RCON) ("Recon" or the "Company") today announced that Future Gas Station (Beijing) Technology Ltd. ("FGS"), a subsidiary of two mainland China variable interest entities with contractual ties to the Company's subsidiary, Recon Hengda Technology (Beijing) Co., Ltd., is expanding on its previous cooperation agreement with its latest packing cooperation memorandum (the "Memorandum") with Hui Tong Tian Xia Petrochemical (Dalian) Co. Ltd ("Huitong Dalian"),  to jointly launch a new generation of industry solutions to serve the national commercial logistics fleet more efficiently and to explore low carbon sustainability with logistics companies by bringing carbon neutral solutions. Huitong Dalian is a leading Chinese company focused on fleet fuel management and is an affiliate of Beijing Hui Tong Tian Xia IOT Technology CO. Ltd ("G7").

FGS and Huitong Dalian previously signed a cooperation agreement in July 2021 to explore the development of an online fuel management system based on the logistics industry to provide a set of management solutions that can meet the needs of G7's customers, mainly logistics companies, to manage their fleet fueling behavior and digital operations such as real-time data management and automatic reconciliation. Based on the previous agreement, the two companies will work together to further improve the efficiency of the digital operation platform and introduce FGS's carbon neutral solution to the logistics industry to create a nationwide online tool for fuel management in the logistics industry.

Mr. Song Yang, the founder of FGS, said, "We are very pleased to upgrade the cooperation with G7. Transportation costs account for more than 50% of total social logistics costs, and road transportation costs account for about 70% of total transportation costs, of which about 80% is borne by medium and heavy trucks. The fuel cost accounts for about 25% of the road transportation costs. We roughly estimate that the fuel expense of medium and heavy trucks in China in the first quarter of 2022 will be about RMB280 billion, which means that the industry-wide fuel expenses are in the trillions every year; however, there lacks a quick and efficient online management platform that can be used nationwide. We hope to further enhance our solution through cooperation with G7, based on G7's extensive customer base and deep insight of the logistics and freight industry, introducing the automatic discount calculation functions and the launch of an enterprise value analysis module to our current online management platform for real-time transactions and to give full play of the business value of FGS. 

In addition, we will introduce a new carbon neutral concept into this cooperation, and work with G7 to create a new platform with carbon neutral comprehensive service capability. The logistics industry is both a major energy consumer and a major carbon emitter, and it has become an important issue to meet the challenge of "double carbon" target and achieve low carbon transformation and sustainable development. Based on G7's IoT and AI technology to collect carbon emission data, the digital solution of carbon neutrality of future petrol stations will be implanted into the daily operation of logistics enterprises to help the logistics industry achieve low-carbon sustainable development.

About Recon Technology, Ltd ("RCON")

Recon Technology, Ltd (NASDAQ: RCON) is the People's Republic of China's first NASDAQ-listed non-state owned oil and gas field service company. Recon supplies China's largest oil exploration companies, Sinopec (NYSE: SNP) and The China National Petroleum Corporation ("CNPC"), with advanced automated technologies, efficient gathering and transportation equipment and reservoir stimulation measure for increasing petroleum extraction levels, reducing impurities and lowering production costs. Through the years, RCON has taken leading positions within several segmented markets of the oil and gas filed service industry. RCON also has developed stable long-term cooperation relationship with its major clients. For additional information please visit: http://www.recon.cn/.

Forward-Looking Statements

Recon includes "forward-looking statements" within the meaning of the federal securities laws throughout this press release. A reader can identify forward-looking statements because they are not limited to historical fact or they use words such as "scheduled," "may," "will," "could," "should," "would," "expect," "believe," "anticipate," "project," "plan," "estimate," "forecast," "goal," "objective," "committed," "intend," "continue," or "will likely result," and similar expressions that concern Recon's strategy, plans, intentions or beliefs about future occurrences or results. Forward-looking statements are subject to risks, uncertainties and other factors that may change at any time and may cause actual results to differ materially from those that Recon expected. Many of these statements are derived from Recon's operating budgets and forecasts, which are based on many detailed assumptions that Recon believes are reasonable, or are based on various assumptions about certain plans, activities or events which we expect will or may occur in the future. However, it is very difficult to predict the effect of known factors, and Recon cannot anticipate all factors that could affect actual results that may be important to an investor. All forward-looking information should be evaluated in the context of these risks, uncertainties and other factors, including those factors disclosed under "Risk Factors" in Recon's most recent Annual Report on Form 20-F and any subsequent half-year financial filings on Form 6-K filed with the Securities and Exchange Commission. All forward-looking statements are qualified in their entirety by the cautionary statements that Recon makes from time to time in its SEC filings and public communications. Recon cannot assure the reader that it will realize the results or developments Recon anticipates, or, even if substantially realized, that they will result in the consequences or affect Recon or its operations in the way Recon expects. Forward-looking statements speak only as of the date made. Recon undertakes no obligation to update or revise any forward-looking statements to reflect events or circumstances arising after the date on which they were made, except as otherwise required by law. As a result of these risks and uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements included herein or that may be made elsewhere from time to time by, or on behalf of, Recon.

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SOURCE Recon Technology Ltd

FAQ

What is the recent announcement made by Recon Technology (RCON)?

Recon Technology announced an expanded cooperation with Hui Tong Tian Xia Petrochemical to launch enhanced industry logistics solutions focused on fuel management and carbon neutrality.

When was the previous cooperation agreement between FGS and Huitong Dalian signed?

The previous cooperation agreement was signed in July 2021.

What are the estimated fuel expenses for medium and heavy trucks in China for Q1 2022?

The estimated fuel expenses for medium and heavy trucks in China for Q1 2022 are about RMB280 billion.

How will the new partnership affect the logistics industry?

The partnership aims to create a comprehensive online tool for fuel management, improving operational efficiency and promoting low-carbon sustainability in the logistics sector.