AUSTRALIA-listed Sino Australia Oil and Gas will invest in an enhanced oil recovery technology project trial with PetroChina Company in the Liaohe oilfield in China’s Liaoning Province.
The investment is one of the first launched by the company since it came under the investigation of the Australian Securities and Investments Commission earlier this year following allegations that company directors had breached their duties.
The Federal Court approved Sino Australia’s initial expenditure of $175,000 to commence the project, which will see it use enhanced oil recovery technology to extract oil from wells in the Liaohe oilfield, from where it is near impossible to extract further oil.
“The company (Sino Australia) will receive as payment at least 70 per cent of the revenue from the sale of all oil extracted from this project, while the Liaohe oilfield (PetroChina) will receive up to 30% of any oil revenue,” Sino Australia said in an announcement.
Sino Australia has hired five experienced specialist oilfields engineers to present the draft oil extraction scheme to the Liaohe oilfield, with adjustments having already been made in response to oilfield feedback data.
The company hopes the scheme will be accepted by Liaohe oilfield by the end of 2014, with a development contract to be signed shortly thereafter.