NuEnergy Gas reported that its wholly owned subsidiary NuEnergy Gas has agreed a variation of the Joint Venture agreement dated 17 November 2011 with Tancoal Energy, a subsidiary of Intra Energy Corp. The Unconventional Gas Joint Venture Variation Agreement (JVVA) captures all unconventional gas, which includes coal bed methane and shale gas. Key terms of the JVVA are shown below. The agreement cements the entry of NGY into the unconventional gas business in East Africa consistent with the company's 2012 business strategy.
Key terms of JVVA:
• Tancoal will hold 30% and NuEnergy will hold 70% of the venture. Tancoal's 30% share to be carried by NuEnergy until any unconventional gas extracted reaches a revenue stage, or for a period of 5 years from commencement, whichever comes first.
• NGY has the right to explore for gas at uneconomical coal depths of over 600 metres and Tancoal may also allow NuEnergy to drill and test for unconventional gas at depths of less than 600 metres where Tancoal have each decided not to conduct coal mining below this level