Sino Gas on Track to Meet Guidance as Lone Star Takeover Looms

Australia-listed China-focused Sino Gas remains on-track to hit its 2018 production guidance despite the start-up of its Linxing North central gathering station being delay, the company said July 12.

“As a result of land leasing delays, site preparation for the new Linxing North Central Gathering Station (CGS) was completed in June 2018, leading to the deferral of commissioning of the CGS to Q4 2018,” it said.

“The Linxing North CGS will increase gross total installed processing capacity in both Linxing and Sanjiaobei PSCs to 42mn feet³ per day,” it added.

The company’s gross production for the first half of the year averaged roughly 24mn ft³ per day and it remains on-track to deliver its 2018 production guidance of a gross average rate of 22-27mn ft³ per day and a gross year-end exit rate of 38-42mn ft³ per day -- as strong production in the first half of the year is expected to mitigate the impact of the Lnixing North delay, it said.

Sino saw production above nameplate capacity in Q1, averaging roughly 25mn ft³ per day with the month of March averaging a record 26mn ft³ per day.

Private US equity firm Lone Star made a A$530mn ($402mn) takeover bid for Sino Gas in May which has been backed by the board of the latter.

“Lone Star and Sino Gas continue to work together to progress the proposed acquisition of Sino Gas by Lone Star and remain on track to meet the announced indicative timetable,” Sino said July 12.

Details of the deal are expected to be sent to Sino shareholders in late July/early August and a vote is expected to be held in early September.