27th Oct 2015 10:19
LONDON (Alliance News) - Altona Energy said it believes its partners remain committed to its joint venture agreement but warns there can be no certainty that the companies will agree on the amended terms to the agreement.
Altona is in discussions with its partners Sino-Aus Energy Group Ltd and Wintask Group Ltd about amending the joint venture agreement for the Arckaringa project in South Australia after the companies decided to focus on using underground coal gasification at the project.
Underground coal gasification produces gas from small segments of coal, usually sourced from formerly producing coal mines, using similar methods as fracking which is the method for extracting onshore shale gas that is popular in the US and other countries.
"Discussions with the company's joint venture partners, Sino-Aus Energy Group Ltd and Wintask Group Ltd have been protracted due to the change in project focus to underground coal gasification, the complexity of the original joint venture agreement and volatile global equity and commodity markets," said Altona.
"The board of Altona believes that Sino-Aus remains committed to the project; however no assurances can be given as to when discussions regarding an amended joint venture agreement will be finalised, although negotiations are well advanced," it added.
Non-Executive Director Nick Lyth will be visiting the joint venture partners in China next week to discuss the agreement further.
Altona shares were down 26% to 0.260 pence per share on Tuesday.
By Joshua Warner; [email protected]; @JoshAlliance
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