Green Dragon Gas signs additional agreements with CUCBM over PSCs in China

Coal-bed methane (CBM) gas developer Green Dragon Gas’ subsidiary Greka Energy (International) has signed three supplementary agreements with China United Coalbed Methane (CUCBM) related to three production sharing contracts (PSCs) in the Shanxi, Anhui and Jiangxi regions of China.

Pursuant to the agreements, Greka can begin exploration across Fengcheng (GFC), Qinyuan (GQY) and Panxie East (GPX) blocks.

The latest development complements the memorandum of understanding on five PSCs, as well as two supplementary agreements on Shizhuang South (GSS) and Shizhuang North (GSN) PSCs signed by Green Dragon last month.

The primary objective of Greka and CUCBM is to maximise the value within the exploration PSCs and the agreements are a step in that direction.

Green Dragon Gas founder and chairman Randeep Grewal said: “These agreements conclude our five PSCs that have been in question over the past eight years, ensuring a committed close cooperation between CUCBM and Greka to unlock and monetise all our lucrative prolific gas blocks.

“The detail within these supplementary agreements eliminates the ambiguity within the PSCs and provides a transparent and clear roadmap to conclude the exploration programme and progress to commerciality.

“We are committed to working closely with our partner CUCBM and concluding material reserve progressions in all our prolific blocks.”

Through the agreements, the PSC exploration period has been extended to the second quarter of 2019 and minimum work commitment has been confirmed for each PSC.