Issue of Convertible Bond

Green Dragon Gas Ltd
30 October 2007


30 October 2007

                             GREEN DRAGON GAS LTD.
                       ('Green Dragon' or 'the Company')

                  Issue of US$45m Zero Coupon Convertible Bond

The Company announces that it has raised US$45 million through the issuance of a
convertible note with a zero coupon and a final maturity date of 25 October 2012
('the Convertible Bond') to an institutional investor. The Convertible Bond is
convertible into the Company's ordinary shares at a conversion price of US$6.25
per share, which represents an approximate 2% premium to the closing market bid
price of US $6.15 on 25 October 2007 ('Issue Date'). Under the terms of the
Convertible Bond, the investing institution has the right to put the Convertible
Bond to the Company, under certain conditions, on the second anniversary of the
Issue Date and at each anniversary thereafter until maturity at a redemption
price of 100% of the principal amount, plus an annualised yield of 9% up to the
relevant redemption date. The Company has the right on the second anniversary
date of the Issue Date and at each anniversary thereafter to call the
Convertible Bond at a redemption price of 100% of the principal amount. In the
event that neither party exercises the put or the call option or any portion of
the Convertible Bond has not been converted in part or in whole on or prior to
25 October 2012 (the 'Maturity Date'), then 100% of the principal amount
outstanding under the Convertible Bond, plus an annualised yield of 9% up to the
Maturity Date, will be payable on the Maturity Date.

Mr. Randeep S. Grewal, Chairman and CEO, comments, 'Strong institutional
confidence and interest in the Company complements the hard work being
accomplished by our employees in the field while revalidating the core strength
on the of the Company's strategic business plan to be a vertically integrated
clean gas supplier in China. We have been reviewing, planning and discussing the
upcoming massive growth year of 2008. In view of the opportunities available to
us, we have elected to raise additional funds to further strengthen the
Company's financial resources and provide us the capacity to make conclusive
decisions. With the funds on hand, we are ideally poised to make such decisions
and expect to make further announcements prior to the year end.'

For further information on the Company and its activities, please refer to the
website at www.greendragongas.com or contact:

Randeep Grewal
Chairman and Chief Executive, Green Dragon Gas Ltd.
[phone]

Tim Thompson/ Nick Melson/ Susannah Gale
Buchanan Communications
+ 44 (0)20 7466 5000

Dr Azhic Basirov/ David Jones
Smith & Williamson Corporate Finance Limited
[phone]



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