Coal bed methane (CBM) gas producer Green Dragon Gas has received approval for the overall development plan (ODP) of the Greka Chengzhuang (GCZ) block in China.
The approval, granted by the China National Development and Reform Commission (NDRC), represents the final regulatory nod before the company can execute the block's ODP and pursue further development of the acreage.
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The ODP covers an area of 33km² out of a contract area of 67km², with proved reserves of around 275 billion cubic feet (bcf).
Green Dragon Gas founder and chairman Randeep Grewal said: "The project code clears the last of the hurdles ahead of implementation of the ODP programme.
“The close cooperation between CNPC and the company is well demonstrated by the continued timely progress of the GCZ ODP as we progress into the active development stage of the GCZ Block.”
Until now, 114 wells have been drilled on the acreage and the block, which is located in the prolific Qinshui Basin, represents a gross production capacity of 6.36bcf per year.
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By GlobalDataUnder the development plan, drilling of an additional 147 production wells, targeting both coal seam #3 & coal seam #15, will be undertaken, with completion expected by the end of next year.
The GCZ Block is situated around 20km south of the Greka Shizhuang South Main Block (GSS Block) and involves a development cost of around $53.8m over two years through next year.
Green Dragon has a 47% participating interest in the GCZ Block, while China National Petroleum Corporation (CNPC) holds the remaining stake.
