Leyshon Resources begins exploration at China gas project

Leyshon Resources shares surged Monday after the company announced it kicked off further operations at the Zijinshan gas project in Central China ahead of schedule.

Leyshon Resources shares surged Monday after the company announced it kicked off further operations at the Zijinshan gas project in Central China ahead of schedule.

A $20m accelerated exploration and appraisal programme at the project, located on the eastern fringe of the Ordos gas basin, began following positive results from drilling at the ZJS5 and ZJS6 wells which intersected multiple potential pay zones.

Contactors were mobilised to the projects and approvals were granted, enabling an immediate start to operations two weeks ahead of schedule.

The 2013 programme includes drilling of up to six weeks, flow testing of wells ZJS5 and 6 and the acquisition of 300km 2D seismic to identify additional well sites.

More than 150km of the 300km seismic lines have already been surveyed.

Flow tests to determine whether commercial flow rates can be established from selected pay zones are expected to begin mid-March as planned, depending on the weather.

"We are very pleased with the rapid progress we have made to date which is due in large part to experience and relationships of our operational team who have given us a flying start to a busy six or seven months," said Managing Director Paul Atherley.

"We are fully funded with a solid base in place following the positive results from JS5 and ZJS6. Following these encouraging results we've brought forward the 2014 exploration and appraisal programme and will be reporting on the flow testing of the first two wells, the results from the six new wells along with the interpretation of 300km of seismic data."

Shares rose 9.76% to 16.88p at 10:07 Monday.

RD

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