Green Dragon fires up deal-making
Article Date: Aug 06 2008Green Dragon Gas, an explorer, developer and producer of coal bed methane in China, has made a strategic acquisition in the domestic energy sector for $9.25 million (£4.7 million). The deal will be funded from the AIM-listed company’s existing cash pool.
The Hong Kong-based company has bought Zhengzhou Nanhai Gas (ZNG), Zhengzhou Clean Petro-Equipment (ZCP) and Zhengzhou Clean Technology (ZCT) from Beijing Nanhai Environment Engineering and several private investors.
The deal is expected to cut costs, diversify income streams and give access to additional gas sales markets.
ZNG operates a compressed natural gas service station in the Henan Province and holds the licences and requisite approvals to construct three additional sites, which are set for completion this year.
The target has secured gas resources until 2013 for volumes of 45,000 cubic metres per day in addition to gas from its Shizhuange South gas field.
ZCP is an operating equipment supplier for compressed natural gas vehicles and service stations. It owns the ZZ Clean brand of CNG dispensers, which are produced for the CNG conversion of vehicles, such as taxi and bus operators.
ZCT is a developer of proprietary automated monitoring system for the upstream gags production, which allows remote monitoring of gas volumes, pressures at the well and compressor sites.
Randeep Grewal, Green Dragon chairman and CEO, says, 'This acquisition consolidates our position in Zhengzhou and provides a strong platform for growth from which to launch gas sales from Shizhuang South.'
