Green Dragon Gas to List Production Business in Hong Kong
London-listed coalbed methane (CBM) explorer Green Dragon Gas has decided to spin off its Chinese CBM production business and list the new entity on the Hong Kong Stock Exchange, it said December 6.
Its remaining exploration and appraisal assets will continue to be listed on the London Stock Exchange and will be renamed as G3 Exploration, effective January 1, 2018 to realign the business with its focus on exploration and development.
Shareholders in Green Dragon will receive a stake in the new company via an in-specie dividend. Green Dragon is expected to be debt free as capital raised from the Hong Kong listing is expected to settle all its existing debt obligations.
“As Green Dragon Gas assets evolve from exploration and appraisal into a full cycle production, it is evident that the London market does not value this as highly as CBM production assets listed on the Shenzen and Hong Kong Exchanges. With this in mind the Board has taken the strategic decision to ring-fence our producing assets by way of a dividend in specie on the Hong Kong Exchange,” said Randeep S. Grewal, chairman, Green Dragon Gas.
The Chinese CBM producing assets comprise of two blocks, GSS and GCZ, and together have a total of around 1,400 wells.