Production Sharing Contracts and Licenses

RNS Number : 9819I

Green Dragon Gas Ltd

10 July 2013

 



10 July 2013

GREEN DRAGON GAS LTD

("Green Dragon" or the "Company")

Production Sharing Contracts and Licenses

The Board of Green Dragon Gas Ltd. (AIM:GDG), one of the largest independent companies involved in the production of CBM gas in China, is pleased to announce it has been provided reissued  four Exploration Licenses covering the Shizhuang North (Shanxi), Qinyuan (Shanxi), Fengcheng (Jiangxi) and Panxie (Anhui) blocks.  The License for the commercial production block Shizhuang South (Shanxi) was also reissued concurrently. These re-issued licenses to CUCBM once again show Greka BV as the Exploration Unit. This action by the Central Government confirms the full force and effect of the Production Sharing Contracts ("PSC"), and follows the withdrawal by China United Coalbed Methane Corporation Limited, an affiliate of China National Offshore Oil Corporation, of the erroneous termination notices that appeared on its website related to the Company's exploration blocks. 

Randeep Grewal, CEO and Founder of Green Dragon Gas, commented:

"We always believed in the Central Government of China and thus the validity of our bi-laterally protected right, title and interest in the Production Sharing Contracts.  We are delighted to have the PSC's reaffirmed by the central government. We have invested extensively for over a decade in these PSC's, building our knowledge and understanding of how to commercially extract gas from coal seams in China, which has resulted in us achieving an IRR of 70% on our first LiFaBriC well till date. We have demonstrated the repeatability of these wells, a vital component for commercial success in CBM. With the title issues behind us, we now look forward to the future with added confidence, as we continue to expand our programme of drilling wells and gas production growth."

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

Stephen Hill, VP Corporate Communications Green Dragon Gas	[phone]
Dr Azhic Basirov / David Jones Smith & Williamson - Nominated Adviser & Broker	[phone]
Steve Baldwin / Nicholas Harland Macquarie Capital (Europe) Limited - Broker	[phone]
Richard Crichton / Andy Crossley Peel Hunt - Broker	[phone]
James Henderson / Phillip Dennis Pelham Bell Pottinger - Investor Relations	[phone]

 

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