Gainsborough South Project China Projects Shiloubei CBM Project


The Shiloubei CBM Project is located in the Hedong Basin, east of the Yellow river in western Shanxi Province, about 600 km to the southwest of Beijing. A 60/40 JV production sharing agreement with CUCBM (China United Coalbed Methane Corp Inc), the project area covers approximately 1015 square kilometers (250,000 acres) underlain by Carboniferous and Permian coal measures.

Shiloubei Prospect Technical Data

Location: Hedong Basin, West Shanxi Province, approx 400 km SW of Beijing
Prospect Area Size: 1015 sq km
Coal Rank: Mid-Volatile Bituminous to Anthracite
Ash Content: 15 - 25%
Net Coal Thickness: +/- 7 to 14 m
Gas Content: 4 - 20 m3/tonne
Estimated GIP: + 6.0 TCF
Gas Composition: + 95% methane
Permeability: 1-4 mD
JV Partnership: 60/40 production sharing partnership with CUCBM

The Shiloubei CBM Project has market access to numerous large towns in Shaanxi province and is approximately 50 km from large interconnector pipelines that supply Beijing.

Shiloubei Prospect


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TARGET OF 6.67 TCF (based on total coal reserve)


Shiloubei HISTORY:

6 test wells, 2 drilled by Enron in 1995 and 4 by Arco in 1997

Review of test wells shows high coal quality:

  • ash content 15 - 25%
  • sulphur content > 1% (seams 3-5) > 2.5% (seams 8-10)
  • average gas content 17.5. m³/t
  • permeability up to 4.9md (mean 1.323 md; median 0.305 md)
  • thickness 7.6 - 13.5 metres

Shiloubei GEOLOGY:
Coal Types:Coking, lean, bituminous to anthracitic (from medium-volatile to anthracite)
Coal Quality:High: ash content 15--25%, sulphur content < 1% in #3,4,5 <2.5% in #8,9,10
Coal Rank:High volatile bituminous to anthracite (vitrinite reflectance of the coal seams = 1.24--2.79%)
Coal Thickness:6 seams: min. 7.6 m, mean 9.69 m, median 9.0 m, max. 13.5 m
Gas Content: 4.15--23.0 cu m/t
Permeability: 0.0012--4.6 md (mean =1.323 median = 0.305)
Depth: 0-2,000 m


Production Sharing Contract (with CUCBM)

  • Signed November 18, 2005 -- Ministry of Commerce Approved December 2, 2005
  • Total investment US$6.26 million over 5 years first year commitment of US$1.51 million
  • Ownership is 60% and cooperation period is 30 years
  • 70% of revenues allocated to cost recovery
    • 60-40 split on balance
    • net 88% to VDC during cost recovery


 

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