Fortune Liulin Gas (FLG) – a joint venture between Australia-listed Dart Energy and London-listed Fortune Oil – is aiming submit its Overall Development Plan (ODP) pertaining to the Liulin coalbed methane (CBM) project for approval in 2013, Dart's COO Nathan Rayner told Rigzone Thursday.
An ODP approval is the green light that foreign operators require from China's National Energy Administration (NEA) in order to move their CBM projects from the exploration to the development phase.
"The ODP is being prepared now and much of the technical subsurface work is approaching completion," Rayner said. FLG is expecting to receive its ODP approval, with the help of its partners, in 2014.
FLG disclosed on Wednesday that the board of FLG and the Liulin production sharing contract (PSC) joint management committee have approved the construction of a field gas gathering system and nodal station for the Liulin CBM project.
The construction contract includes 7 miles (12 kilometers) of pipe, an in-field nodal compression station and five miles (eight kilometers) of export trunk-line to an existing compressed natural gas plant. Mobilization of contractors and equipment has started with the first earthworks expected before the end of September. Construction works are scheduled to be completed by mid-2013.
Gas production from the Liulin field has exceeded one million standard cubic feet per day, which Dart said is particularly pleasing.
"[The increasing field rates] demonstrate the performance capability of the multi-lateral wells we have been developing in China over the last 18 months. The decision to move from the construction phase has now been taken, and our focus remains on achieving first gas and first revenues as soon as possible," Dart's CEO John McGoldrick said in a statement.
The Liulin block – located in Shanxi – stretches across 71 square miles (183 square kilometers). China United Coal Bed Methane (CUCBM) and FLG each hold 50 percent stake in the block. Dart and Fortune each hold an equal stake in FLG.
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