Hong Kong and China Gas HONG KONG AND China Gas (Towngas) expects to finalise five gas projects in the mainland in its latest attempt to spur growth as last year's net profit was barely changed at $3.05 billion. Managing director Alfred Chan Wing-kin said the profit contribution from the group's mainland portfolio had doubled to $132 million last year. 'We will continue our expansion on the mainland, our growth area,' Mr Chan said, adding that five projects, in Heilongjiang, Liaoning, Jilin and Fujian, would be finalised. He said Towngas' net profit for this year would receive a boost from pre-sales of Grand Promenade apartments in Sai Wan Ho and the Ma Tau Kok residential project. Profit in 2003 included a $200 million one-off gain from the sale of 14 floors of Two International Finance Centre to the Hong Kong Monetary Authority, which means last year's profit would have grown 7 per cent excluding the gain. Unlike electricity suppliers CLP Holdings and Hongkong Electric Holdings, which have their core earnings regulated and linked to asset growth, Towngas' bottom line is based on gas sales. Last year, growth was flat at 0.5 per cent, dragged down by a 1.4 per cent decline in residential use. Nevertheless, the group expected a 2 per cent increase in gas sales this year. To reduce the use of the more expensive feedstock naphtha, Towngas spent $1 billion building a pipeline importing natural gas from Guangdong last year. Mr Chan said another $1.1 billion would be spent on the project, with supply of natural gas being available next year.