Next Fuel's China, Indonesia Coal-to-Gas Pilot Well Update

Next Fuel, Inc. Tuesday provided an update on its coal-to-gas (CTG) pilot projects in China and Indonesia.

Company’s CTG pilot test in southern Sumatra, Indonesia, was recently completed with encouraging results. Six wells were drilled and completed into a virgin lignite seam with no prior gas production or reserves. Within six weeks, all of the wells were producing newly created biogenic methane gas at a measurable rate.

Next Fuel said that the successful pilot test has positioned the company as the first company in the world to announce the successful implementation of biological CTG technology in a virgin coal seam with no gas production history.

The company also announced that it has finalised a pilot test project in Inner Mongolia, China, in concert with its strategic partner, Future Fuel. As with the Indonesian pilot project, multiple wells were drilled and completed into a virgin lignite coal seam with no prior gas reserves or production.

Newly-generated biogenic methane gas was detected in the wells in China within three weeks of nutrient injections and the company expects to commence full-scale commercial operations in Inner Mongolia during the second quarter of 2012, and a licensing agreement is currently being negotiated.