 |
 |
 |
 |
 |
 |
 |
China
Liulin Project (40% Interest)
In April 2008 the exploration term of the Liulin Production Sharing Contract was extended by the Chinese Ministry of Commerce to 2010. Molopo had finalised the transfer of its CBM interest in the Liulin Block, Shanxi Province, China, to the JV Company, Fortune Liulin Gas Company Limited, owned 40% by Molopo and 60% by Fortune Green Energy Limited, a wholly owned subsidiary of Fortune Oil PLC.Fortune earned its interest by funding a USD 2.5 million appraisal programme with the drilling of FL-EP-1 and
FL-EP-2 production wells. Core data was collected over the main target coal seams (seams 3/4, 5 and 8/9) with 11.4m and 8.9m of net coal in FL-EP1 and FL-EP-2, respectively. The high gas content and thick coal seams with high permeability have confirmed the prospective nature of coals in the Liulin Block.FL-EP-1 and FL-EP-2 were fracture stimulated across
seam 8/9 and have been undergoing an extended
de-watering period with larger pumps having been installed to increase the water production rates to some 1000 to 1200 bbls of water per day. Minimal gas flow has as yet been seen at either well.One of the original Molopo wells (LW-L3) was also completed and commenced de-watering at approximately 700 b/d. At the time of writing, this well was undergoing early gas desorption and was producing some
20,000-30,000 scf/d of gas.Further appraisal and production drilling is planned in order to meet the Chinese Ministry of Land and Resources latest regulations for certification of gas reserves. Fortune Liulin Gas Company is now planning
to complete two new CBM data wells for analysis of permeability and desorbed gas content in each major seam and will production test
seams 3/4/5.An independent resource estimate was completed for Fortune Oil over the permit during the year. This assessment estimated a 3P reserve of 29.7 Bscf, a 3C contingent resource of 630.5 Bscf and an additional prospective resource of 135.8 Bscf. These volumes are consistent with Molopo’s earlier view of a potential
700-800 Bscf recoverable volume for Liulin.The Liulin Contract Area is situated in the central Hedong Coalfield on the eastern margin of the Jurassic to
Permo-Carboniferous Ordos Basin. It is approximately 500km from Beijing.
Figure K P.R China - Liulin Prospect
Gas flare, Liulin China
