The Board of Fortune Liulin Gas (FLG) and Liulin PSC Joint Management Committee (comprising FLG and CUCBM, FLG's state-owned partner in the project) have approved the construction of the field gas gathering system and nodal station at the Liulin CBM gas project in Shanxi Province, China, and a contract has been entered into for the first phase of construction.

FLG is a joint venture equally owned by Dart Energy Limited and Fortune Oil PLC, and is the operator of the Liulin CBM gas project.

The construction contract is for the field gathering system (including 12km of pipe), the in-field nodal compression station and export trunk-line (8km) to the existing CNG plant. Mobilisation of contractors and equipment is now underway with the first earthworks anticipated before the end of September. Construction is scheduled to be complete by mid-2013.

This infrastructure will connect the in-field multi-lateral production wells to the recently completed CNG station. The completion of this independently owned station was announced by Dart on 26 July 2012. This will provide the route to the market and enable initial revenue generation from the Liulin block.

Production from the field has continued to improve on a weekly basis. Since May, gas rates from existing wells have been steadily improving. The best well in the field (H-4) has a peak production in excess of 400 Mscf/d with two other wells (H-3 and H-6) also already exceeding 200 Mscf/d. Total field production is now approximately 1MMscf/d.