re: Ann: Dart Acquires Stake in European Comp... Perhaps related...

re: Ann: Dart Acquires Stake in European Comp... Perhaps related to the below


8 September 2010 ASX Announcement

Gas Sales Agreement at Liulin, China

Global coal bed methane (CBM) company Dart Energy Limited (ASX:DTE) today announced the signing of a Gas Sales Agreement (GSA) at the Liulin project in China, as Dart and its partners at Liulin push closer to delivering one of the countrys first commercial CBM production projects.

The GSA has been entered into between China United Coal Bed Methane (CUCBM) on behalf of the Liulin gas project and Shaanxi CUCBM, a company which is primarily responsible for the marketing and sale of gas for local power generation in Shaanxi province, China.

The GSA relates to supply of gas from the initial Liulin pilot wells on a take-or-pay basis, of approximately 1.3 BCF per annum over a period of 15 years. First gas is to be delivered by 1 July 2011 with the take-or-pay obligations commencing 1 July 2012.

The agreed gas price is 1.58 RMB per cubic metre (1.38 RMB per cubic metre base price subject to annual escalation and review, plus 0.20 RMB per cubic metre government subsidy). This equates to approximately A$ 6.90 per gigajoule.

Dart currently has an underlying 17.5 percent stake in the Liulin gas project after acquiring a 35 percent interest in Fortune Liulin Gas (FLG) which has a 50 percent participating interest in the project. The remaining 50 percent is held by CUCBM. Dart has options to increase its share in FLG to 50 percent and ultimately to 75 percent, which would give Dart an underlying interest of up to 37.5 percent in the project.

The Liulin gas project covers 183 km2 and is located 500 km south-west of Beijing within the south-east Ordos Basin. The project currently has certified 3P reserves of 86 BCF and is designated a State Special Pilot Project, enabling the acceleration of the exploration and development program.

Dart Chief Executive, Simon Potter, said the agreement meant the company was well on track to meet one of its key commercial targets of first gas sales in China by 2012.

"We are delighted with this development at the Liulin gas project. Although volumes are modest, first gas sales are always a significant step towards demonstrating the commerciality of any project. This gas sales agreement commercialises Liulins initial pilot gas, and provides a solid base on which to develop the rest of the project. The price being achieved is a strong starting point, especially since no significant infrastructure investment is required from Dart. This validates our market view of China and we expect prices only to rise over time. This is also an important milestone in the co-operation between CUCBM and Dart," Mr Potter said.

Cheers
H