Chinese coal bed methane company Green Dragon Gas is looking for retail acquisitions after losing an interim £7 million.

‘The timing has worked perfectly’ for Cayman Islands-based Green Dragon, proclaims Randeep Grewal, chairman, chief executive and principal shareholder of the AIM-quoted company, despite an eightfold loss increase in the six months to June. He says the company, which has accumulated attested accessible reserves of 20 trillion cubic feet of coal methane gas, is poised to benefit from the Chinese government’s policy of subsiding a conversion to gas fuel by taxi drivers, commercial vehicle operators and other drivers and pricing this fuel at a 40 per cent discount to petrol.

Green Dragon, which stands to receive $13.80 (£7.48p) per million cubic feet, raised £20 million in 4.45p in May and ended the first half-year with £40 million cash and converted of £20 million long-term debt into equity. The company spent £29 million on acquisitions in Canada and China.

Grewal says Green Dragon plans to buy retail outlets in China and does not rule out more major acquisitions. He suggests the company’s operating figures next year should begin to reflect the fruits of its previous investment.

At $8.38 (465p), Green Dragon’s tightly held shares value the company at £492 million.
Growth Company Investor subscribers have full access to all our AIM and small-cap share recommendations. To subscribe today with a half-price offer, and gain immediate access to all the recommendations, click here.

Green Dragon Gas	AIM	$529m	$5.00	$0.00
Click here for interactive charting
Other company articles:
Green Dragon to expand			29/09/2008
Newcomer - Green Dragon Gas			17/08/2006