Company Information for Green Dragon Gas

Company stock charts - 6 Month chart

AIM; GDG

Company Statement

Green Dragon is the parent company of Greka China, and is exclusively focused in gas industry in China. Green Dragon operates within China under its subsidiary Greka China.

Green Dragon is a gas supplier based in China with a focus on the production, development, transportation, distribution and sales of natural gas from coal seams, commonly known as coal bed methane or CBM. Our goal is to increase the degree of vertical integration in our operations.

Greka China, a pioneer in the appraisal and development of CBM projects in China, generates our CBM supply from four projects in Shanxi, Jiangxi, Anhui and Guizhou province covering acreage holdings of a total of 7566 km 2 and an estimated 22 Tcf of Gas In Place. CBM distribution from these projects to customers are mainly in the form of Compressed Natural Gas (CNG) and to a lesser extent, via pipeline in the form of Piped Natural Gas (PNG).

Greka China collaborate with CUCBM, a state-owned enterprise specializing in the niche oil and gas-related areas, in the development of our CBM reserves. Greka China has operational rights under the CUCBM Development Projects pursuant to production sharing contracts, PSCs with CUCBM.

Greka Technical Services, an in house drilling division on CBM drilling rig based in Zhengzhou as our operational hub of our upstream operations. The five technically advanced drilling rigs are manufactured from United States and the hiring of 150 technical personnel. We has successfully hedged its exposure to rising drilling costs, availability of skilled crews and drilling rigs with GTS.

Greka Manufacturing is profitable operating equipment supplier for CNG vehicles, service stations and other related activities. Our CNG dispenser carries the “Clean” brand has a current capacity to produce over 300 CNG dispensers in modular and can be expanded as the demand for CNG continues to grow throughout China.    Greka Information Technology is a niche technology division providing proprietary software and Supervisory Control and Data Acquisition systems for petrochemical companies. This proprietary software is required across all facets of our company’s operation from upstream drilling and CBM production, to midstream gas compression and transportation and the downstream gas sales and cash collection.

Greka Gas Distribution develops and operates Compressed Natural Gas (“CNG”) Service Stations. Our CNG stations sites are synergistic to our interest in the Shizhuang South coalbed methane production block in Shanxi as well as its recently acquired distribution centre located in Zhengzhou.

Operations and Technology

Green Dragon Gas floated on London’s AIM in August 2006 raising US$25 million. In December 2007 the company announced it also planned to list in Hong Kong. The Company is focused on coal bed methane projects in China, where it has interests in five blocks in partnership with China United Coalbed Methane Corporation (CUCBM). In March 2008 it announced plans to acquire Vancouver-listed Pacific Asia Energy China in an all cash deal worth C$35 million, adding the Guizhou exploration project to its books plus a 50 per cent stake in the PACE Mitchell Drilling joint venture. This deal increased Green Dragon’s PSC acreage to 7,566 sq km with the potential to hold over 23 trillion cubic feet of gas in place, making it the largest foreign CBM operator in the country.

China has huge CBM resources, ranking third in the world after Canada and Russia. According to Green Dragon, China has at least 578 trillion cubic feet (tcf) of CBM in place and possibly as much as 1,200 tcf. Green Dragon was one of the original five companies that signed agreements in China, keeping company with industry big hitters Arco, Texaco, Phillips and Enron.

Green Dragon’s original five projects lie in three provinces - Shanxi, Jiangxi and Anhui - and cover a total of 6,620 sq km with an estimated 16.6 tcf of gas-in-place, of which over half is thought to be recoverable. By design, all of Green Dragon’s acreage is at least one province inland from the coastal provinces in order to avoid competition with LNG imports from Australia and other Asian countries. These three provinces are all densely populated, with major cities, good infrastructure and energy-hungry industrial plant.

In 2007 the company drilled 88 wells on its five blocks, taking the total number of wells drilled to date on its acreage to 154. Its most advanced project is Shizhuang South, where an operational power plant and compressor station have been installed ahead of first gas sales later in 2008.

In July 2008 the company completed a US$10.68 million acquisition of Giant Power International. The all-cash deal added interests in two strategically-located compressed natural gas mother stations, which distribute gas from the massive CNPC West-East gas pipeline. Green Dragon now holds a 35 per cent interest in a 330,000 cubic metres per day capacity station in Zhengzhou in Henana province, with a population of 4.3 million, and 50.6 per cent of a 200,000 cu m per day station in Wuhu in Anhui, with a population of 2.2 million. Both mother stations are geographically adjacent to Green Dragon’s coal bed methane blocks Shizhuang South and Panxie East.

The company also has a 49 per cent interest in Kesi Hengrun Technology Company (KHBT), which in turn has a 59 per cent interest in Beijing Huayou United Gas Development Company (BJHY), a group which develops a gas distribution network in the Beijing Economic Technological Development Area (BDA). The remaining 41 per cent interest in BJHY is held by China National Petroleum Company (CNPC), the parent company of PetroChina. BJHY’s main activity is the development of a gas distribution network in BDA which is a rapidly growing industrial zone adjacent to the Beijing-Tianjin expressway. BJHY owns 166 km of pipelines with a capacity of 4 billion cubic metres. Green Dragon Gas believes BJHY is capable of generating revenues in the region of over a billion dollars, of which 28.9 per cent would be attributable to Green Dragon Gas.

Board of Directors and Key Management

Chairman & CEO : Randeep S. Grewal

Chief Financial Officer : Alfred Yan

Vice President, Business Development : Terry Siu

Vice President, Exploration & Development : Mahmood (Mel) Lone

Non-executive Director : David Turnbull

Non-executive Director : Stewart John, OBE

Non-executive Director : Gong Da Bing

Vice President & Chief Operations Officer : Zhang Bao Zhuang

Company Address

Suite 3308
Two Exchange Square
Hong Kong,


Telephone:	852 37100168
Email:	hkoffice[at]greka.com
Website:	http://www.greendragongas.com

Capital

Number of Ordinary Shares issued – 94,513,413

Nominated Brokers

Smith and Williamson Corporate Finance Limited

GMP Securities

Nominated Advisors

Smith and Williamson Corporate Finance Limited

Major Shareholders

Randeep Grewal through Green Dragon Gas (Holdings) Limited 95.2%

Most Recent Statement

09/03/10 - Notice of Results
16/02/10 - Reserves Upgrade and Operations Update
11/02/10 - Appointment of Broker
11/12/09 - Holding(s) in Company
08/12/09 - US$75m Placing & Debt Repayment
25/09/09 - Convertible Bond

To top