Sino Gas and Energy has moved closer to supplying the booming Chinese domestic gas market from its two fields in the Ordos basin after securing $US100 million in funding from Macquarie Bank.
Beijing-based Sino managing director Glenn Corrie said it was an exciting time for the company as it targeted production of 350 million cubic feet a day to more than 550 million cubic feet a day by 2022, and significant free cash flow by 2020.
Macquarie has committed to $US68 million that Sino anticipates will fully fund the Perth-based company's share of the development of the Linxing and Sanjiaobei projects. An additional $US32 million could be used to accelerate the development of the projects.
In a statement to the ASX, the company said the Linxing field had been prioritised as a strategic project in Beijing’s 13th five-year energy plan released in January.
Progress has also been made on approvals for the first Linxing field with submission of the field development plan to Sino’s partner in the production sharing contract, China United Coalbed Methane Limited.
Mr Corrie said the plan demonstrated it was a low-cost large-scale field that could be developed with proven technology.
Shares in Sino Gas and Energy Holdings were 4.7 per cent down to 10 cents a share at 11am.
