Arrow Energy International has claimed majority ownership of a leading coal-seam methane project in China after agreeing to a farm-in agreement with Far East Energy.
The Australia-based energy company will farm-in to a 75% operating interest in the Qinnan CBM PSC coal seam methane project, located in China’s Shanxi province.
The project is believed to contain 5.3 trillion cubic feet of total gas reserves, making it one of the world’s most significant gas resources.
The deal follows moves by the Chinese government to boost its production of coal bed methane by 2010 to provide cleaner energy alternatives.
Arrow chief executive, Nick Davies, expects the site will become a “material project” within the company’s portfolio and produce 20PJ per annum for at least 15 years.