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Main Forum•Arrow's DART hits Dajing block CSM target with JV
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ARROW Energy has performed a great leap forwad in China, with the signing of a 30-year production-sharing contract (PSC) for the prospective Dajing CSM lease.
Arrow will act as operator and explore the 3969 square kilometre block for unconventional gas.
The Dajing block is located in the East Junggar Basin in the Xinjiang Autonomous Region in China's far west.
The East Junggar Basin has extensive coal resource at less than 650m depth and coal seams of up to 70m thick
The Xinjiang region is estimated to contain more than 500 trillion cubic feet of coal seam gas reserves, ~ 25% of the Chinese national total and is connected by infrastructure including the West East pipelines I and II with a third West East pipeline planned for 2012-15.
Arrow's first-year work program involves drilling 14 exploration wells specifically aimed at determining the key gas reservoir characteristics and assessing the long-term commercial viability of the Dajing block.
About DARTDuring early 2010, Shell and PetroChina's launched a $3.4 billion takeover bid which will result in Arrow investors receiving $4.70 per share plus one share in a new company, Dart Energy.
Dart Energy will hold a 90% interest in Arrow International, which holds the existing portfolio of international assets in China, India, Vietnam and Indonesia.
The Dajing block will be a key asset for the demerged Dart Energy.
Dart chief executive officer Simon Potter said that: "The Dajing block has the potential to become a marquee CSG project not just in China but globally."
So AOE's DART is right on the bullseye as far as I can see.
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For those that would like to understand the investment opportunity in greater detail have a read of this UBS Resources and Energy Conference Dart Energy Presentation
Personally I am delighted to have the opportunity to get in on the ground floor of India, China, Indonesia and Vietnam's Coal Bed Methane industries.
