Sanjiao CBM Inclusion in Chinese Plan a Booster for Project

Sino Oil and Gas has said in a statement Tuesday that inclusion of Sanjiao CBM project in official Chinese plan will further drive the overall development of the project.

The National Development and Reform Commission of the People's Republic of China released a policy paper on 12th Five-Year Plan for Development and Utilization of Coalbed Methane on 31 December.

This policy release reaffirmed the state's focus on the development of two coal bed methane commercial bases in Qinshui and the eastern fringe of Ordos Basins.

Sino Oil and Gas Holdings Limited, through its subsidiary Orion Energy International Inc., is operating the Sanjiao CBM project in Shanxi, which has been listed as a core project under the Plan.

Sino Oil and Gas Holdings Executive Director and Chief Executive Officer Mr. King Hap Lee said: "Aiming to accelerate the development of the CBM industry, the Plan mandates increased investments in CBM exploration, strengthened management of foreign cooperation, encouragement of participation of overseas and private-enterprise investors, continued implementation of tax and other incentive schemes, as well as the possible increase in CBM subsidies. The Sanjiao project's official inclusion in the state plan will help us gain stronger support from Central and local government authorities, providing a better environment for the development, construction and operation of the project, as well as a further boost for the Sanjiao project's profitability."

The Sanjiao project, which commenced trial external sales in August 2011 in the form of compressed natural gas, is currently stepping into the commercial production phase. The project's overall development program will soon be submitted for NDRC's approval, with supplementary gas pipeline and liquefied natural gas infrastructure currently under construction.