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| Wednesday, 19 October 2011, 15:30 HKT/SGT | |
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Source: Quamnet | |
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HONG KONG, Oct 19, 2011 - (ACN Newswire) - Quamnet.com ("Quamnet"), a division of Quam Limited ("Quam"; HKSE:00952), has conducted an exclusive interview with Sino Gas & Energy Holdings Limited ("Sino Gas" or the "Company"; ASX:SEH), an Australian company developing unconventional gas assets within the Ordos Basin, Shanxi Province China.
During the interview, Mr Stephen Lyons, Managing Director of Sino Gas, expressed positive view towards the future of the Company as the demand for gas in China increase rapidly, and that the potential reportable reserve of the Company is expected to increase.
The full text of the story is as follows:
Sino Gas & Energy's Considerable Increase of Potential Reportable Reserve
A foreign energy company with unconventional foresight is now actively exploiting unconventional natural resources in China, one of the world's fastest growing energy markets. Sino Gas & Energy Holdings Limited (ASX: SEH), an Australian listed company focused on developing China's unconventional gas assets, has operated in Beijing since 2005 and holds a portfolio of new energy assets in the country through Production Sharing Contracts (PSCs).
The Company has a successful exploration track record that has discovered large-scale resources - 2P reserves of 19 billion cubic feet ("Bcf"), and contingent and prospective resources of 1.9 trillion cubic feet ("Tcf"); on-going drilling and seismic activities continue to de-risked the assets.
Most recently, the Company reported that new seismic work and other exploration conducted in Sanjiaobei PSC, one of the two PSCs it operates, have found potential new gas reservoirs as well as new zones of gas resources in previously untested areas, expanding its resource area dramatically by four times from 90 km2 to as large as 400 km2; related wells have confirmed these findings. The Company is working with reserve experts and the new figures of potential reportable reserves will be updated at the end of October.
With solid progress towards its target of achieving reserves certification in 2012, Sino Gas has paved its way for the submission of an Overall Development Plan (ODP), fulfilling its ambition to supply coal bed methane as well as shale gas to fuel China's robust economic growth in a more sustainable and eco-friendly manner.
When interviewed by Quamnet, Mr. Stephen Lyons, Managing Director of Sino Gas, said he is optimistic about the future as China is now focusing intently on identifying and bringing into production all forms of natural gas, both conventional gas deposits and unconventional gas reserves located in the many coal seams and shale and other rock formations across the country, in particular in the Ordos Basin in Shanxi Province where Sino Gas operates.
Coal bed methane is a form of gas extracted from coal seams. With its considerable reserves and much lower environmental impact than the burning of coal for the equivalent energy, coal bed methane has become a potential major source of clean energy with increasingly strategic importance in securing China's future energy needs. Mr. Lyons pointed out that the world is running out of conventional resources, and numerous environmental and conservation organizations have been working specifically on advocating the responsible development of coal bed methane.
China has massive reserves of coal bed methane and has growing demand for such clean energy to cut its over-reliance on coal and other traditional resources. As Mr. Lyons noted, natural gas is seen as a key component of clean energy supply, and Chinese authorities plan to lift the proportion of natural gas to 8.3% of the country's energy mix, with unconventional gas resources accounting for one third of the gas supply during the country's 12th Five-year Plan, while the government also plans to improve returns for producers and double the subsidy for coal bed methane gas prices to foster development, which will have the effect of increasing wellhead prices by as much as 15 per cent.
As an upstream gas exploration and development company, the expertise of Sino Gas is to develop and deploy various special techniques to extract the gas and ultimately sell it to China's energy markets to meet the rapid increase in demand. Mr. Lyons said the Company has six years' presence in China and has very substantial gas assets of 1.9 Tcf contingent and prospective gas resources on its acreage, which stacks up very nicely against most large gas fields around the world. By applying its expertise of best practice project management and resource development skills, Sino Gas is well poised to further develop its extensive Chinese gas assets.
The Company has formed partnerships with China's oil and gas majors, including China National Petroleum Corporation (CNPC, parent company of PetroChina) and China CBM (CUCBM, equally owned by China National Offshore Oil Corporation (CNOOC) and China Coal Group).
Currently, Sino Gas has 2 PSCs (Linxing and Sanjiaobei) located in Shanxi Province in Ordos Basin with an area of 3,000 km2, one of the largest foreign company holdings. Ordos Basis is the second largest onshore oil and gas producing basin in China. The area has mature gas field developments with an established pipeline infrastructure delivering gas to major northern and eastern metropolitan markets and to the rapidly developing local economy of Shanxi province, providing Sino Gas' large scale gas assets ready access to buyers for its soon to be implemented 24/7 operation with gas sales to meet the local demand.
Mr. Lyons is particularly proud of the Company's effective well testing programs in 2011 that have discovered gas at multiple depths, exhibiting exceptional flow rates of over 500,000 standard cubic feet per day (scf/day), with some in excess of 1,000,000 scf/day. After its demonstrated success at greater depths, the Company is now testing shallower zones with the expectation of further adding to its substantial reportable reserves and resources.
Linxing PSC has an extensive exploration area of 1,874 km2, with 2P reserves of 13 Bcf, mid case contingent resources of 747 Bcf and prospective resources of 663 Bcf, respectively. In 2011, 4 commercial tests have been conducted in Linxing west and flows exceeded 1,000,000 scf/day on 2 wells. As for Sanjiaobei PSC, it covers an area of 1,126 km2, with 2P reserves of 6 Bcf, mid case contingent resources of 158 Bcf and prospective resources of 291 Bcf.
The Company has no debt, and Mr. Lyons stated it has flexible financial facilities to fund the Company's continuing exploration and development activities allowing it to move to the commercialization of its large gas assets in high demand markets with attractive gas prices.
Contact:
Quam IR
Ms Anita Wan
Tel: +852-2217-2811
E-mail: anita.wan@quamgroup.com
Ms Sharon Au
Tel: +852-2217-2812
E-mail: sharon.au@quamgroup.com
Ms Vanessa Lau
Tel: +852-2217-2814
E-mail: vanessa.lau@quamgroup.com
Topic: Research / Industry Report
Source: Quamnet
Sectors: Gas & Oil, Daily Finance, Energy, Alternatives
http://www.acnnewswire.com
From the Asia Corporate News Network
Copyright © 2024 ACN Newswire. All rights reserved. A division of Asia Corporate News Network.
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