29th Oct 2013 10:04
LONDON (Alliance News) - Green Dragon Gas Ltd Tuesday said it now has a non-binding heads of agreement with a unit of China's state-owned oil giant China National Offshore Oil Corporation in relation to a potential deal over drilling done on lands it had production sharing licenses for.
A heads of agreement is a deal done before a confirmed, detailed agreement is made.
Earlier this month, Green Dragon said it has significantly increased its resource estimate in China following a drilling programme by third parties on its production sharing contract.
The company found out about the extent of the drilling done on the lands when the Chinese government re-issued licenses for the four exploration blocks and one commercial production block in July. That prompted it to increase its resources estimates and predict that its revenues from the areas would be higher than it first expected. It entered talks with the Chinese companies doing the drilling to find out more about the drilling activities.
Green Dragon shares were up 5.3% at 261.09 pence Tuesday morning.
By Steve McGrath; [email protected]; @stevemcgrath1
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