China's NDRC Approves RH Petrogas' Oil Development Plan for Fuyu Block
Singapore-listed RH Petrogas Limited (RHP or the Group), engaged in the business of exploration, development and production of oil and gas resources, announced Thursday that the Group’s Overall Development Plan (ODP) for the phased development of the Yongping Oilfield in the Fuyu 1 Block has received approval from the National Development and Reform Commission (NDRC) of the People’s Republic of China. The approval of the ODP will allow the Group to advance into the development and production phase for Fuyu 1 Block.
Fuyu 1 Block is located in Songliao Basin, Jilin Province, the People’s Republic of China and is operated by Kingworld Resources Limited (KRL), a wholly owned subsidiary of the Group. KRL entered into the petroleum contract for Fuyu 1 Block (Fuyu 1 PSC) with China National Petroleum Corporation (CNPC) in November 2007. KRL has a 100 percent working interest in the Fuyu 1 Block during the evaluation phase. Upon the commencement of commercial production under the Fuyu 1 PSC, CNPC would back in for a 51 percent working interest.
The approved ODP allows KRL to operate and drill up to 1,008 wells in Fuyu 1 Block over a course of five years. These are shallow wells with average depth of less than 984 feet (300 meters). Fuyu 1 Block is expected to yield a total of 14.6 million barrels of oil during its production cycle, of which RHP will hold a 49 percent interest.
Francis Chang, CEO said: “We are very excited to receive the NDRC approval. It represents a significant milestone for our China project as it moves into the development and production phase. In anticipation of this approval, we had started pre-development preparation as well as the procurement of long lead items since early 2013. This helps to accelerate the development program and allow production to commence in early 2015. Production will be ramped up progressively as more wells are drilled under the approved ODP.”
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