China United Coalbed Methane Co., Ltd. (CUCBM) signed a production
sharing contract with US-based Sino-American Energy Inc. here
Monday for cooperative development of the coalbed methane resources
in north China's Shanxi Province.
The contracted block of 150.8 square km is located in Qinshui
County of Jincheng City, which has convenient transportation
facilities with neighboring cities in Shanxi and Henan provinces
where demand for clean gas energy is increasing, said Huang Zhida,
general manager of the CUCBM.
The development of coalbed methane is of strategic significance for
the progress of local economy, readjustment of energy structure and
the utilization of clean energy, Huang said, adding that the block
is close to the west-east national gas pipeline now under
construction, which will facilitate the transportation and sales of
coalbed methane there.
With estimated coalbed methane reserves of 30 billion cubic meters,
the block is suitable for commercial development, and is expected
to become the first to enter the development stage among all
Sino-foreign blocks.
To
date, the CUCBM has signed 19 coalbed methane contracts with
foreign companies, with a total contracted area of more than 32,000
square km and coalbed methane reserves of more than 3.4 trillion
cubic meters. As of the end of 2002, foreign investment had reached
90 million US dollars.
According to the contract signed with the CUCBM, Sino-American
Energy, which specializes in the exploration, development and
production of coalbed methane resources, will introduce its
advanced horizontal well technology for pilot development in China.
The two investors will share production during the development and
production periods according to their investment proportion.
The CUCBM, established in 1996, is the sole professional company in
China responsible for the exploration, development, production,
transportation, sales and utilization of coalbed methane in the
country. It enjoys the exclusive right of exploring and developing
coalbed methane resources in cooperation with foreign
companies.
China is rich in coalbed methane resources and has 30 to 35
trillion cubic meters of reserves no more than 2,000 meters in
depth. It is the second country in the world to conduct large-scale
coalbed methane surface exploitation following the United
States.
(Xinhua News Agency March 4, 2003)