China Sandi Intends to Acquire CBM Assets in Shanxi Province

China Sandi on Tuesday said it has signed a letter of intent with third parties in relation to the proposed acquisition of a part of or the entire equity interests in Guosheng Hengtai Energy Development.

Guosheng is principally engaged in the business of exploration and production of coal bed methane and provision of related technical services and consultation services. It is the operator of a coalbed methane exploitation project in Taiyuan, Shanxi Province, China.

Guosheng has entered into a coal bed methane exploration and production sharing contract with the exploration rights holder of the Gujiao Project. It is the operator of the Gujiao Project and it is responsible for the exploration and production of coal bed methane in an area of approximately 552 square kilometres within the registration plot in return for sharing the revenue derived from the sales of gas. As at the date of this announcement, an area of approximately 190 square kilometres of the Gujiao Project is in the development stage, with production facilities under construction.

Shannan Tianyuan and Shannan Shengyuan, the third parties, own 78.66 percent and 11.78 percent of the equity interests in Guosheng Hengtai.