China North East Petroleum Holdings Limited is engaged in the exploration and production of crude oil in Northern China. As of December 31, 2009, the Company operated 289 producing wells located in four oilfields in Northern China. It has an arrangement with the Jilin Refinery of PetroChina Group to sell its crude oil production for use in the China marketplace. Through two of its subsidiaries, Song Yuan City Yu Qiao Oil and Gas Development Ltd. Corp. (Yu Qiao) and Longde Oil and Gas Development Co. Ltd. (LongDe), the Company has entered into binding sales agreements with the PetroChina Group, whereby it sells its crude oil production for use in the China marketplace. The Company operates in two segments: oil production and oilfield services (well drilling). On September 27, 2009, the Company acquired through Song Yuan Technical all of the equity interest in Song Yuan Tiancheng Drilling Engineering Co., Ltd. (Tiancheng).