London-listed Fortune Oil has entered an agreement to gain a 51% stake in China s Liaoning Jingrun Natural Gas Limited (LJNGL) for 10.5 million yuan ($1.6 million).
Fortune said LJNGL had recently been awarded a 30 year concession to build and operate a spur pipeline, which will supply natural gas to the ceramics industrial park located in the county of Jianping, Liaoning Province.
It added the pipeline was expected to be completed next year and supply up to 200 million cubic metres of gas per year.
In addition to the initial consideration a further payment may be made by Fortune if over the five years following the completion of the deal it receives dividends exceeding 20% of the initial payment per year.
Fortune said the payment would be equal to the excess over the 20%, capped at 7 million yuan.
