Reserves Update

RNS Number : 4820R

Green Dragon Gas Ltd

28 October 2013

 



28 October 2013

GREEN DRAGON GAS LTD

("Green Dragon" or the "Company")

400% increase in estimated 1P reserves to 300 Bcf

Green Dragon Gas Ltd. (AIM: GDG), one of the largest independent companies involved in the production and sale of CBM gas in China, is pleased to announce a significant increase in estimated reserves following the drilling of the additional c.1500 wells drilled on its Production Sharing Contract areas by third parties.

Reserves Highlights

·      Total original gas in place of 25.2 Tcf

·      Net 1P reserves increase to approximately 300 Bcf (59 Bcf at 31 December 2012)

·      Net 2P reserves increase to approximately 600 Bcf (313 Bcf at 31 December 2012)

·      Net 3P reserves increase to approximately 2,600 Bcf (2,508 Bcf at 31 December 2012)

The increase in estimated reserves by the Company (primarily at Shizhuang South and Shizhuang North) is based on information recently disclosed by the Chinese parties.

Green Dragon remains in positive dialogue with the Chinese parties, in order to gain further information. As additional material information comes to light, the Company will make further announcements in this regard.

Randeep S. Grewal, Chairman and Founder of Green Dragon, commented:

"The Company in-house engineers have made their best estimates following the receipt of pertinent information from the third parties of their drilling activities. We expect this preliminary information will be further enhanced over the next few months and thereafter audited by Netherland Sewell and Associates at year end, in accordance with our standard practice.

Green Dragon is in constructive dialogue with the relevant parties in order to successfully ascertain the appropriate entitlement over this extensive drilling activity. At this point we are aware that gas production and revenues have been extracted from the blocks and these will be disclosed in a later update following verification. We are committed to resolving this matter amicably but are ready to enforce our rights if needed to ensure appropriate entitlement to Green Dragon shareholders."

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]

The reserve estimates contained in this announcement have been prepared in accordance with definitions and guidelines set out in the 2007 Petroleum Resources Management System approved by the Society of Petroleum Engineers and have been reviewed by Elton Dong, the Company's Chief Engineer and Vice General Manager Production, Bachelor of Science at Xi'an Petroleum Institute.

Definitions

1P	proved reserves
2P	proved plus probable reserves
3P	proved plus probable plus possible reserves
Bcf	billions of cubic feet
CBM	coal bed methane
PSC	production sharing contract
Reserves	reserves are those quantities of hydrocarbons anticipated to be commercially recoverable by application of development projects to known accumulations from a given date forward under defined conditions
Tcf	trillions of cubic feet

 

END

 

 

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