Cathay Acquires Rights To Pakistan Coal/Coalbed Methane And To Participate In Joint Countrywide Natural Resource Exploration Project
Toronto, Ontario - Cathay Oil & Gas Ltd. (Cathay) has acquired the exclusive rights to coal bed methane and groundwater in the Pakistan province of Sindh, estimated at up to 21 trillion feet of recoverable natural gas. In addition, Cathay Oil and Gas Ltd is part of a consortia of entities including Pakistan and U.S. Government organizations and academic groups that will conduct a multi-year countrywide aerial and land based exploration program. Pending funding, Cathay will have the right to develop additional natural resource discoveries including coal, coal bed methane, oil, and minerals. Cathay is currently in advanced discussions with potential funders.
Joint Agreements: Several multi-party agreements provide Cathay with:
- The exclusive right to explore for and develop the coal and associated coalbed methane (CBM) and water resources in the province of Sindh for a period of six years.
- The right to participate in a joint multi-year countrywide aerial and land based exploration program designed to identify coal, gas, oil, and mineral deposits throughout Pakistan.
Sindh Government Coalbed Methane Agreement: Cathay has signed a six year exclusive right to explore for and develop the coal and associated coalbed methane (CBM) and water resources in the province of Sindh. With this contract, Cathay controls one of the largest known coal resources in the world containing over 10% of the world's total coal reserves, more than 175 billion tons as defined by the U.S.G.S. The Thar coals are known to be the western extension of the coals in the Cambay Basin in India, which have reserves of some 13 trillion cubic feet of coalbed methane gas. Cathay's area of interest covers some 135,000 square kilometers (roughly 50,000 square miles). The USGS has estimated that the Thar coal field, roughly 20% of Cathay's license, is comparable to the Powder River Basin of the western United States, and may contain up to 36 trillion cubic feet of coalbed methane with up to 21 trillion cubic feet potentially recoverable.
Cathay worked with both the Federal and Provincial governments to unify jurisdiction over coal, coalbed methane and the associated ground water under a single provincial jurisdiction. Unlike China where foreign companies must partner with the state-owned China United Coal Bed Methane on a 60% company 40% CUCBM ratio, under the unified jurisdiction in Pakistan, Cathay owns 100% of the rights and has no requirement to production share with any company. Cathay has also negotiated regulations and royalty agreements for CBM with the Sindh Government. These agreements were based upon an extensive review of coalbed methane regulations, royalties and case law from around the world that Cathay conducted for the governments of Pakistan and Sindh.
Consortia Exploration Agreement: In addition to the Sindh CBM agreement, Cathay Oil and Gas Ltd is part of a consortia of entities including Pakistan and U.S. Government organizations and academic groups that will conduct a multi-year countrywide aerial and land based exploration program.
Cathay and the consortia are planning a joint program to explore for coalbed methane, oil, gas and minerals and to develop detailed topographic, geologic hazard, vegetation and geologic maps throughout Pakistan. The program will involve the latest mapping, stereo imaging, geophysical (gravity, gravity gradiometer, magnetic) and remote sensing technologies available. Cathay will also participate with the US Government in developing natural resource Centers of Excellence in Pakistan.
OPIC Insured Investment Opportunity: Various portions of the project qualify for OPIC political risk insurance, creating an unprecedented opportunity to participate in a virtually untapped, multi-billion dollar natural resource play.
SOURCE: Cathay Oil & Gas Ltd.