China Natural Gas Signs Natural Gas Supply Contract with Sinochem and Expands into Henan, China's Most Populous Province

NEW YORK--Aug. 14, 2006--China Natural Gas, Inc., (OTCBB: CHNG; website: www.naturalgaschina.com) the first China-based natural gas public company traded in the U.S. capital market, today announced that the Company has signed a 5 year natural gas supply contract with Zhengzhou Zhongyou Oil & Gas Co., Ltd., a subsidiary of Sinochem, China's largest chemical company to supply 350,000 cubic meters of compressed natural gas per day to the Company's planned new stations in China's Henan Province.

A neighboring province to Shaanxi Province where the Company is located, Henan is the most populous province in China with a growing population of approximately 100 million people. As a part of its expansion strategy, the Company plans to establish new natural gas filling stations in this region going forward.

Chairman and CEO Qinan Ji stated, "We are very pleased to have entered into this strategic gas supply agreement with a subsidiary of China's largest chemical company. The 5 year natural gas supply agreement will ensure the new stations we plan on operating in the Henan region will have a steady and reliable gas supply. As mentioned during our recent quarterly earnings conference call, we continue to focus on aggressively growing our network of natural gas stations and expansion into new regions in order to capture new market share and meet the ever increasing demand for environmentally friendly compressed natural gas as an alternative fuel to gasoline in China. We will keep our shareholders updated on our progress as we launch new stations in the near future in the Henan region."

About China Natural Gas, Inc.

China Natural Gas, Inc., ("CHNG"), a Delaware company, is the first China based US public natural gas services provider that owns and operates a 120 kilometer long compressed natural gas pipeline in China's Xi'An area, a fast growing Chinese city supported by a population of approximately 8 million and is the "gateway" to the broad Western regions of China. CHNG has three profitable business segments: end user delivery of natural gas services to residential, commercial and industrial customers; wholesale natural gas to retail natural gas filling stations; and retail natural gas at company-owned natural gas filling stations. The city of Xi'An has approximately 20,000 Taxis, 3,000 buses and 2,000 special purpose vehicles that are powered by compressed natural gas. Approximately 8.6% of the company's shares are owned by Bodisen Biotech, Inc. (AMEX: BBC)

Safe Harbor Statement

This press release may contain forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations or beliefs of China Natural Gas, Inc. management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.