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Market: AIM
Sector: Energy
EPIC: GDG
Latest Price: $8.00  (3.23% Ascending)
52-week High: $14.00
52-week Low: $5.50
Market Cap: $1,092.33M
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Green Dragon Gas
www.greendragongas.com

Green Dragon Gas is the leading CBM Independent in China. Our Vision is to be a vertically integrated gas supplier providing optimum shareholder returns through the execution of an environmentally progressive niche business plan in China.

Full Green Dragon Gas profile here
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Green Dragon Gas on target to meet growth targets, says CEO Grewal 

16th Jan 2012, 8:25 am by Jamie Ashcroft Last year 131 per cent more wells were drilled and as a result gas production increased by 126 per cent

Green Dragon Gas (LON:GDG) told investors that it is on target to meet its aggressive growth targets.

The Chinese coal bed methane (CBM) firm is working to monetise its significant gas assets, which comprise both production and distribution operations.

Last year 131 per cent more wells were drilled and as a result gas production increased by 126 per cent.

Production in the fourth quarter was around 407 million cubic feet. GDG says it exited 2011 with an annualised production rate of 1.68 billion cubic feet.

GDG has a large CBM resource in the People’s Republic with proved and probable reserves of 273 billion cubic feet and 2.6 trillion cubic feet of net proven, probable and possible reserves.

It is currently progressing a major expansion programme, spurred by a US$250 million capex programme which targets a massive uplift in production to an annual target of 18 billion cubic feet.

The firm’s AIM quoted associate Greka Drilling (LON:GDL) is contracted to this work programme.

“The value to the overall business will become increasingly apparent as momentum continues to build from the additional production wells in a proven resource area with a proven commercial drilling fleet contracted from Greka," said chief executive Randeep Grewal. 

Meanwhile the firm says it sales capacity is being enhanced. GDG aims to sell its gas through both midstream and downstream channels.

The midstream business expects to start selling gas to PetroChina Huabei in the second quarter of this year, once work to connect gas pipelines is complete.  

Meanwhile, in the downstream business, GDG has signed a deal to supply around 1 million cubic feet of compressed gas to fuelling stations used by fleets of dual-fuel transport businesses in the Henan province in central China.

The firm’s strategy is to grow its network of refuelling stations, allowing more gas to be sold directly to end users. This is expected to give sales prices a significant lift, it said.

"Green Dragon has continued to make solid progress across all business lines from the production of gas through to both CNG sales direct to the end user and via pipeline into the main national network,” Grewal said.

He added: “The market has long appreciated the environmental benefits and the cost savings of CNG versus diesel. 

“One of the barriers to the rapid CNG conversion of City-to-City fleet transport hubs has been the lack of a stable supply of gas which we are well-positioned to provide and at prices that are increasingly being supported by favourable Government policy measures.”

 

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