Far East Energy Extends Shouyang CBM Block License
Far East Energy Corporation has received formal approval from China’s Ministry of Commerce for extending the exploration period of its Production Sharing Contract (PSC) for coalbed methane (CBM) in the Shouyang Block in Shanxi Province.
Among other provisions, the agreement with China United Coalbed Methane Corporation (CUCBM) provides a four-year extension of the exploration period for approximately 297,415 acres (approximately 1203.6 square kilometers) until June 30, 2015, and a two-year extension for approximately 121,080 acres (approximately 490 square kilometers) until June 30, 2013.
"China promises to be the fastest growing market for natural gas in the world over the next decade, and while domestic supplies of conventional gas may be limited, it has enormous, largely untapped resources of unconventional gas. Beyond the potential of the Shouyang Block itself, Far East Energy is also uniquely positioned as one of the few foreign operators with a pipeline agreement in place to take its gas to market with favorable pricing. This multi-year approval from MofCom, coupled with certification of Chinese reserves by the MLR, now positions Far East Energy to move forward with great confidence," Michael R. McElwrath, CEO and President said.