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22 Aug 2011 11:38
22 August 2011
GREEN DRAGON GAS LTD
("Green Dragon" or "the Company")
Infrastructure Update
Green Dragon Gas Ltd. (AIM: GDG), one of the largest independent companies involved in the production of CBM gas and the distribution and sale of wholesale gas in China, is pleased to an announce an infrastructural update for its facilities at Shizhuang South (GSS) in Shanxi Province.
The Company has successfully installed two new Caterpillar gensets (distributed generator systems), each with a capacity of 2,000kW. They are designed and built to replace the original GSS gensets and supply power to facilitate gas production of 28 new wells plus other new related facilities which will come on stream by the end of 2011.
These gensets have been commissioned and are able to cover the current electricity demand at GSS. Following the successful completion of phase 1 of operations, two old 800kW gensets and three 400kW gensets were retired from service and the Company has now commenced Phase 2. Phase 2 will add a further 6,000 kW, thereby increasing total output to 10,000 kW. This is expected to be completed by the end of 2011.
The total cost of Phase 1 and 2 is approximately USD3.5 million.
Randeep Grewal, Chairman and Chief Executive of Green Dragon Gas, commented:
"This infrastructure build-out is a result of our confidence in predicting the gas production from each of the SIS wells being drilled. In scaling CBM projects, as evidenced at GSS, getting the infrastructure right is quite important as it forms a material component of the full cycle economics. This infrastructure is focused on self generated power, compression for CNG and pipeline gas sales. Henceforth, the infrastructure will be aligned and built along-side the wells being drilled.
Our short term target now is to achieve a breakeven EBITDA also within the upstream component of the vertically integrated business model."
For further information on the Company and its activities, please refer to the website at www.greendragongas.com or contact:
Stephen Hill Green Dragon Gas
| +852 3710 0168 |
Dr Azhic Basirov / David Jones Smith &Williamson - Nomad & Broker
| +44 20 7131 4000 |
Tim Redfern / Anu Tayal / Adam James Evolution Securities - Broker
| +44 20 7071 4312 |
Paul Connolly / John Dwyer / Steve Baldwin Macquarie Capital (Europe) - Broker
| +44 20 3037 2000 |
| |
James Henderson / Phillip Dennis Pelham Bell Pottinger - Investor Relations
| +44 20 7861 3800
|
Robyn Joseph Kreab Gavin Anderson- Public Relations | +852 3753 6020 |
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