Pacific Asia China Energy venture wins US$2.7M Chinese coal mine degas work

Pacific Asia China Energy Inc. (TSXV:PCE) said Tuesday its PACE Mitchell Drilling Corp. joint venture has confirmed a contract worth up to US$2.7 million for degasification at the Yunnan Weixin Guanyinshan coal mine in Kunming, China.

PACE Mitchell Drilling, a 50-50 venture with Mitchell Drilling Corp. of Australia, is to drill one or two sets of horizontal wells to degasify a block measuring two kilometres by 200 metres, reducing the methane gas content to a safe level for tunnel work.

The contract value is US$1.4 million, rising to US$2.7 million if mine owner Weixin Yuntou Yuedian Zhaxi Energy Co. exercises an option for a second vertical well with two laterals into the seam.

Drilling is to begin by early October, with project completion scheduled for December.

The contract "demonstrates the confidence PACE Mitchell is gaining from coal mining officials as they seek a reliable and viable alternative for degasifying their coal mines," stated PACE president Tunaye Sai.

Chinese officials are moving to abate explosive methane levels in the country's coal mines, which are among the world's most hazardous workplaces.

In addition, degasification recovers coal mine methane as a clean-burning energy source, while reducing air pollution.