Green Dragon Gas secures approval for CBM project in China

Chinese coal bed methane (CBM) gas producer Green Dragon Gas has received approval for project code for the overall development plan (ODP) on the Greka Shizhuang South Zaoyuan portion of the Main Block (GSS).

The approval received from the China National Development and Reform Commission (NDRC) will ensure that the ODP does not require a separate approval process.

Under the ODP, the company intends to invest $190m on the project that covers an area of 50.7km² of the total 388km² GSS Block.

Green Dragon Gas founder and chairman Randeep Grewal said: "The GSS Zaoyuan Block was granted ODP project code, which rapidly shortens the timeframe to execution as only registration is now required.

“Following this decision, the company now has two ODP registration approvals, one each in our GCZ and GSS commercial gas production blocks.” 

The approvals will enable the company to accelerate commercial gas production, with plans to produce 20 billion cubic feet (bcf) on the two blocks.

Once the infrastructure building is completed, the blocks are expected to have a processing capacity of 65bcf a year.

Green Dragon has a 60% participating interest in the GSS block, while the remaining interest is held by China National Offshore Oil’s (CNOOC) wholly owned subsidiary China United Coalbed Methane (CUCBM).

Under the GCZ ODP, the company is planning to drill an additional 147 wells by the end of next year. The company will invest $25m to achieve a production capacity of 6bcf per annum at the GCZ block.

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Image: Operations at Green Dragon Gas site. Photo: courtesy of Green Dragon Gas.