We keep our 221p valuation of GDG unchanged and might revisit it when the details of the listing and capital raising operations become clearer (Figure 2).Full report is available via Capital Network website
G3 Exploration (LON:G3E), previously Green Dragon Gas, published an operational update for its Baotian-Qingshan (GGZ) Block, located in the Guizhou Province of Southern China.
Green Dragon Gas Ltd (LON:GDG) announced that it has finalised agreements with CUCBM, a subsidiary of CNOOC and Green Dragon Gas Ltd (LON:GDG) partner in the GSS and GSN Blocks, which conclude eight years of discussions regarding Green Dragon Gas Ltd (LON:GDG) interest in the wells historically drilled by CUCBM in the two Blocks. These agreements confirm the respective interests of the partners as well as the amount of costs recovery resulting from CUCBM’s work programme for the period 2007-2014. Although we welcome this announcement, it is unclear from the RNS whether these agreements have an immediate impact on either GDG’s gas reserves or on future production, revenue and cash flows. We suspect most of the positive impact to be expressed in a closer future cooperation between the two partners focussed on the monetisation of gas resources, which should be positive for investors’ sentiment and have a positive impact on the share price. However, we keep our 221p valuation unchanged.
This announcement follows an earlier announcement by GDG (15/09/17) of the approval of a Project Code for the Overall Development Plan (ODP) on the GCZ block by the China National Development and Reform Commission (NDRC), confirming its final approval. The Block is jointly operated by CNPC and GDG through a joint management team based in Jincheng, Shanxi. The development cost for GCZ will be c.US$53.8m over 2017 and 2018. CNPC will invest US$28.5m according to its 53% participating interest and GDG US$25.3m based on its 47% participating interest in the Block.
No investment advice
The information on this Site is of a general nature only. It does not take your specific needs or circumstances into consideration, so you should look at your own financial position, objectives and requirements and seek financial advice before making any financial decisions. You acknowledge and understand that neither the Company, its related bodies corporate, the information providers or their affiliates will advise you personally about the nature, potential value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter. You should read our FSG and any other relevant disclosure documents and if necessary seek persona advice prior to making any investment decision.
You understand and agree that no Content (as defined below) published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person.
You understand that in certain circumstances the Company, its related bodies corporate, the information providers or their affiliates may have received, or be entitled to receive, financial or other consideration in connection with promoting, and providing information about, certain entities on the Site and in communications otherwise provided to you.
You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate. From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.
Before you act on any general advice we provide, please consider whether it is appropriate for your personal circumstances.