Sino Signs New CBM Sales Agreement
Australia-based but China-focused Sino Gas & Energy has signed a new gas sales agreement for the Sanjiaobei coalbed methane (CBM) project located in Ordos basin in Shanxi province, it said July 24.
Sino Gas' joint venture company, Sino Gas & Energy, in conjunction with its Sanjiaobei production sharing contract partner, PetroChina, has signed a new agreeement for gas sales from the Sanjiaobei production sharing contract to Shanxi GuoHua Energy.
Last week the company had signed a gas sales agreement with Shanxi GuoHua for supply from its Linxing project, also located in Ordos basin. GuoHua is a subsidiary of Sinopec and is one of the largest gas distribution companies in Shanxi province, which is to the southwest of Beijing.
The new gas sales agreement is effective until the end of the current PetroChina marketing period at the end of 2017 with a fixed price of about $6.40/'000 ft3, consistent with the recent Linxing agreement, and GuoHua has agreed to purchase all available Sanjiaobei gas. Like the recent Linxing GSA, there are no penalties on either party for shortfall, Sino said.
The sales agreement is in addition to and does not negate the existing gas sales agreement on Sanjiaobei, expanding the offtake options and increasing optionality for maximising production and revenue.
Shardul Sharma