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There are signs of rising confidence in the sector. Cnooc-controlled CUCBM and PetroChina plan to spend billions on CBM development over the next few years and smaller companies are reporting rising production and reserves. Private equity-backed AAG Energy, which is developing two CBM projects in Shanxi, has revived plans for a Hong Kong initial public offering after being forced to drop its efforts to list on the exchange in 2012. Read more: http://www.petroleum-economist.com/Article/3308663/Enter-Green-Dragon.html#ixzz2tJfuR3dS

The Chinese government would not have wanted to risk a potentially embarrassing arbitration proceeding involving a major state-run company. Especially at a time the Xi Jinping government is championing broader reforms that promise a more prominent role in the economy for private investors. The dispute had also sent a chill through the CBM sector, which unlike other areas of China’s upstream has significant foreign participation. But it was not the end of the saga. During subsequent negotiations with CUCBM, Green Dragon management learned that during the dispute CUCBM and PetroChina had drilled around 1,500 wells on Green Dragon’s acreage, most of which in the producing GSS block. “I was really taken aback when they told me how many wells had been drilled,” Mahmood Lone, the company’s chief operating officer, told Petroleum Economist. Some of the drilling was plainly visible from the road that runs through the company’s primary area of operations. But the mountainous terrain meant that large-scale development went undetected by Green Dragon personnel. During a recent drive through the area, extensive CUCBM’s development was evident. Green Dragon says that in the end the drilling could actually work in its favour. It says the State Council decision means that it has a right to a share of the revenues generated from gas sold from those wells and data collected from the drilling could lead to a major proven reserves upgrade, all without spending a dime. “Green Dragon is now set to benefit from what could have been an unwelcome invasion of its 6,620 square km licence areas,” the company said in a January press release. The company says negotiations are progressing and it hopes to conclude an agreement with CUCBM and PetroChina in the first quarter. In the meantime, it is pressing ahead with a 150-well drilling programme for 2014. Beijing is keen to get the CBM sector on course. Last year state-run China National Offshore Oil Corporation (Cnooc) took a majority stake in CUCBM, a move analysts say will bring fresh investment and much needed skills into the CBM sector. CUCBM has in the past been criticised for hindering rather than helping the sector expand. In September last year the State Council and National Energy Administration announced a raft of measures including increased subsidies, financing support for development and infrastructure as well as new tax breaks to encourage CBM development. Beijing has set a target to increase CBM output from 14.1 billion cm in 2012 to 30 billion cm by 2015 and 50 billion cm by 2020. Recent setbacks will make the 2015 target difficult to meet but the 2020 target could be achievable. A number of analysts have argued that CBM, which has already proven commercially viable, will play a far more important role in domestic production this decade than shale. There are signs of rising confidence in the sector. Cnooc-controlled CUCBM and PetroChin

Enter Green Dragon … 13 February 2014 After a series of missteps, China’s CBM sector could finally be getting on track, writes Justin Jacobs IN NORTHERN China’s rugged Shanxi province, the valleys and hillsides are dotted with pumpjacks sucking gas out of the region’s rich coal seams. State-owned companies and smaller private investors are accelerating development. Gas processing plants are under construction and gleaming white storage tanks are being erected. China’s coal-bed methane (CBM) country is bustling. The buzz of activity is a promising sign for an industry that China has long struggled to get off the ground. The country has an estimated 31 trillion cubic metres (cm) of CBM resources, nearly a third of which are thought to lie in the Qinshui basin in Shanxi province, historically one of China’s most prolific coal producing regions. Hardly any of those resources have been explored and proven up, but the potential dwarfs the country’s conventional gas reserves. And there are powerful incentives to develop the CBM sector. Beijing is keen to increase natural gas’ share of the energy mix to help shift away from heavily polluting coal-fired power generation. It hopes to double natural gas’ share of the overall energy mix rose from 4% in 2010 to 8% by 2015. Domestic producers, though, are struggling to keep up with the new demand and the country faces a mounting import bill, so the government is keen to pump up output from its resource rich CBM, tight and shale gasfields. Yet for two decades Chinese CBM has remained a stubbornly difficult play to crack. At seemingly every turn the industry has run into technological, legal and market barriers. China’s coal seams are heavily faulted, which has made them difficult to produce with existing technologies. Conflicts between local and central governments as well as the coal and CBM industries over mineral rights have slowed development. A severe lack of pipeline infrastructure in the main CBM producing region of Shanxi province means less than half the gas produced from CBM wells actually makes it to market. It has been especially difficult at times for a crop of smaller foreign investors trying to find their niche in China’s state-dominated upstream. Green Dragon Gas, a London-listed independent CBM producer, is a case in point. The company was an industry pioneer when it won some of the country’s first CBM licences in the late-1990s, and holds a large acreage position across five blocks. But it recently found itself mired in a dispute over the fate of those contracts with China United Coal Bed Methane (CUCBM), the state-owned enterprise set up in the mid-1990s to champion the sector. In early 2011, CUCBM said it was ending Green Dragon’s five production sharing contracts (PSC), including at the producing GSS block, a decision that could have essentially ended Green Dragon’s China busine

This is great confirmation for GDG and work for GDL. Its going to be a great year !!

The research papers I have prior to the third party drilling stated that 3 brokers had put a TGT price on the stock at $30.00 WHEN HITTING ITS 18BCFT exit target. This was when it was trading in $ so thats about £20.00 per share ! THIS WILL BE A MASSIVE 2014

How the dickens can you sell when the big money is coming in is beyond belief ! Perhaps they have a tax bill to pay.

Looks like we are off and running. With over 2m of buys its looking soo promising now.

Nice one and good luck to you. My thinking is these super large trades are centred around the compensation payments GDG is likely to receive from the Chinese drillers or should I say poachers that peppered their blocks of land with holes during 2013. RG did say this would all be resolved in the first quarter.

They say follow the big money and there is plenty to follow !

Thanks

Hi Was questor tipping GDG in this sundays Telegraph ?

Does anyone have the date for this as I believe this could be a major trigger point for all three business. I thought it was sometime this week coming ?

Great share tip in the telegraph today. Not long now and off we go

MMs trying to get shares on the qt

You to,its going to fly but the hush money is on this one as its the slow but long burn winner

They have just raised 35m today and the further 65m will come by the end of Jan. They must of sorted out the third party drilling issues in order to receive this kind of money. Back to £10.00 this year now very much on the cards. !!! 16 December 2013 GREEN DRAGON GAS LTD ("Green Dragon Gas" or "the Company") US$35 million Convertible Bond at US$6.06 a 33% Premium Green Dragon Gas Ltd. (AIM: GDG), one of the largest independent companies involved in the production and sale of CBM gas in China, is pleased to announce that it has launched a convertible bond ("the Bond") facility of up to US$100 million. The first tranche of US$35 million has been fully subscribed by GIC Private Limited and future issues of the Bond will be at the discretion of the Company. The final tranche is expected to be issued on or before 31 January 2014. The Bond is unsecured, has a 7% coupon, is due in December 2015, and is convertible into ordinary shares at a conversion price of US$6.06 per share, representing a 33% premium to the closing price at pricing on 10 December 2013. The Company intends to use the net proceeds to launch its 2014 drilling plan and for working capital. Jason Triplitt, Head of European Equities, GIC Asset Management, stated: "GIC sees long term value in the Coal Bed Methane (CBM) industry in China, GDG's extraction methodologies, gas resources and the further development of its licence blocks.We look forward to our investment into the company benefitting from its continued growth and crystallization of value after a decade of effort and experiences in the China CBM sector." Randeep S. Grewal, Founder and Chairman of Green Dragon Gas, commented: "I am delighted to report that the first closing is from a leading sovereign wealth fund. We look forward to working with GIC as we continue to execute our shareholder value- focused business plan. This initial closing will assist the Company to launch into its 2014 LiFaBriC drilling plan while we concurrently conclude our discussions with CNPC, Petrochina and CNOOC. The Company has firmly stated its short- term production target of 18 BCFPY through the drilling of additional LiFaBriC wells by Greka Drilling. Our annualised levels of production have been additionally enhanced by the third party drilling activities."

Yep about that.

This going to go ballistic whenever the MMs let it go.

Green Dragon Gas inks MOU to confirm participating interests in Chengzhuang block By Giles Gwinnett December 12 2013, 7:26am PetroChina will now provide all information to complete an audit Green Dragon Gas (LON:GDG) reported progress in better understanding the repercussions of third party drilling on its licences. It has inked a memorandum of understanding (MOU) with PetroChina to confirm its participating interests in the Chengzhuang block (GCZ), which is part of the Shizhuang South production sharing contract (GSS). This follows news in October that Green Dragon's Chinese state-owned partners drilled as many as 1,500 wells on five of its six licences without it knowing. PetroChina will now provide all information to complete an audit so as to conclude and accept the capital expenditures incurred to develop the block, the gas production, gas sales and related revenues. PetroChina will continue to be the operator of the GCZ block and Green Dragon will continue to operate GSS. Green Dragon's founder and chairman Randeep S. Grewal said on Thursday: "We are pleased to be in continued cooperation with PetroChina and look forward to partnering with them as they operate the GCZ block. "Following the upcoming audit, we will be able to confirm the amount of expected receivable from prior year gas sales as well as the related capital spent for the block's development. "We now look forward to progressing this MOU to a successful conclusion for our shareholders early in 2014." The drilling by third parties has boosted the firm's net proven (1P) reserves by 400% from 59 billion cubic feet (Bcf) to 300 Bcf, it reported at the end of October.

Because the AIM market is full of impatient muppets ! Just sit back and let the story unfold in front of your eyes. Today the fuse paper was lit and this will go into orbit sooo very soon.