Even the enemies of Randeep S. Grewal admire his business savvy. Few might be surprised when the CEO of Green Dragon one day on the list Forbes magazine shows the billionaires. His company recently shares on the London Stock Exchange AIM, starting with a market capitalization of US $ 525 million, was quite bold stroke, a few eyebrows. Green Dragon placed a bit more than 4.5 million shares to increase less than 5 percent of outstanding shares of the company to $ 25 million. Randeep Grewal kept the remaining 95.2 percent of Green Dragon for himself
noticed after the approval of the company on the AIM market Grewal. "2007 promises to be an important year for CBM and its contribution to the Chinese energy supply to be ... This list is an important and timely milestone in our growth driven strategy. " The last time Grewal stooped to deal with the minor annoyances of the capital markets, he personally bought all the shares of Greka Energy Corp, then traded on the NASDAQ. Shareholders loved him - he 69 percent premium for their shares paid in the year 2003, Greka delisted from NASDAQ and deregistered with the US Securities Commission.
Since then, it has been difficult to track Grewal latest achievements, but based on the price of oil, his privately owned fiefdom is likely flush with cash. In a 2002 press release Grewal revealed the then publicly owned Greka Energy 800 million barrels of recoverable heavy heavy oil, which is ideal as feedstock for his asphalt refinery. This year Greka the throughput was 3400 barrels of asphalt per day. According to ABC News, the state of California paid $ 359 / ton for asphalt - up 61 percent last year. High fuel prices are driving major oil companies from the crude oil to squeeze more gasoline production. Definitely Grewal simply gets wealthier with every new barrel of asphalt or crude oil his company produces.
At least Green Dragon Gas will now publicly traded on shareholder participation. But, only a few shares available to the public. Grewal may be generous at the end of the day to the shareholders, but he did not with his shares this early in the game goodbye. In its filing statement with AIM, the company introduced that a further issue of shares to raise additional cash would come as a last resort, or sensitively explained, ". ... As in the circumstances" Grewal would offer initially on debt financing and other measures before shareholders additional liquidity.
It is no coincidence, the share price of GDG, which opened for trading at US $ 5.56 / share quickly rose to a current altitude from $ 6 , 60 / share. A close study of Grewal last company explains the high confidence in Green Dragon Gas. Do not be confused with the aforementioned energy Grewal who now Greka Integrated, Green Dragon Gas is called, is the parent company of Hong Kong-based Greka Energy. They hold five CBM production-sharing contracts with the Chinese government CUCBM (China United Coalbed Methane Company). Green Dragon The contracts are on massive tracts of land (more than twice the size of Rhode Iceland) that could accommodate potential 16.5 trillion cubic meters of methane gas.
After Green Dragon Gas website, Grewal is also chairman and chief executive of the Greka Integrated resident in California, a company that described as "involved in heavy oil and gas transportation, refining, real estate and interest energy properties and refining assets. "It's Santa Barbara County 'largest onshore oil company with holdings in Bakersfield, orange County and the Los Angeles basin, Greka almost 70 onshore production, processing and transportation facilities in Santa Barbara (CA) is working and the Santa Maria asphalt refinery. It's the same, the
produced 3400 barrels of asphalt in 2002 every dayWhile others talk a good game, Grewal draws in energy game. In his last published interview which we were able to dig (August 2001), Grewal explained exactly how he planned Greka to make energy a success story, ie selling oil or product asphalt and then sell asphalt, depending on the price. And then he did. In a July 2002 Press release Grewal mentioned his company long-term activities in China would have. And now it does - through Green Dragon Gas.
unabashedly In explaining the company's business during his 2001 interview, Grewal boasted: "We are $ profitable at 10 oil We are $ profitable at 30 oil, we are profitable at $ 2 gas, and we.. are profitable $ 16 gas. "He called his asphalt plant" a natural hedge vary in commodity prices. "It also provides consistent cash flow. And there is no doubt Grewal is always profitable with crude oil selling around $ 70 / barrel.
Steve Chase, Santa Barbara County deputy energy director, the Greka refinery (Greka and has participated in fining - see below) governs, calling the company's business. "absolutely brilliant" Chase praised Greka in a newspaper article New Times to explain the company's profitability ", oil not sold either high or low, but asphalt. If you are an oil company with an asphalt refinery, you can sell into two different markets. If oil Chase praise, Grewal the path to success is low, you can use it to make asphalt. If it is high, you (only) for sale. "
Despite having been without a few car wrecks along the way. In the years 2002 and 2003, his company was cited for more than 70 injuries, the oil spills and gas included versions, according to the Santa Barbara News-Press Gazette . the prosecution of the country filed felony charges against Greka after an explosion near the asphalt refinery injured two workers. Greka opted for civil penalties of $ 200,000.
in November 2005, lost Greka Integrated his injury-of-contract lawsuit against a former safety manager, Gary Lowery. in June this year imposed the US Environmental Protection Agency, the company $ 127,500 for "unauthorized disposal of waste water oil refinery in the injection wells, the system, in violation of federal safe Water Act drink." has this Greka over $ 700,000 paid settlements since Grewal took the company private. life is a bit annoying to be less problematic, if an oil for much more than $ 30 / barrel is sold. Especially when the same oil was profitable at 10 $ / barrel.
Grewal to China turned to build his fortune
Randeep Grewal came in the energy markets as chairman and chief executive of an oil and gas horizontal drilling company, Horizontal Ventures. During the energy bear market began Grewal sent a series of mergers and acquisition of oil and gas facilities, to his first Greka Energy Corp. out He knew where to find deals and deftly began his energy empire assembly. Horizontal drilling is integral to coalbed methane development, Grewal brings back to where he started - as a gas drilling company.
havesuffered Also on the way, two of Grewal companies bankruptcies. Last November, Saba Enterprises, formerly Greka Energy Corporation, filed for Chapter 7 bankruptcy, after two creditors won judgments $ 19.5 million Euro. In his petition, the company announced it had no assets. The total creditor shortfall could rise to more than $ 24 million. In 1999, another company of which Grewal a director Sabacol was - a subsidiary of Saba Petroleum, was released following the sale of its assets to work 11 bankruptcy after it travels through methods chapter.
Life is also filled with many second chances. This time, however, through Greka Energy (Hong Kong) and Green Dragon Gas (GDG), Grewal owns what might someday become a multi-billion dollar gas project. Smith & Williamson, Green Dragon rated IPO emission the company at $ 973 million, depending on their success GDG estimated methane gas in place and the wellhead price at time of delivery in the restoration.
Until recently, coalbed methane was treated as a hazardous waste product, the miners killed in tunnel explosions. In China, depending upon whose numbers you believe, 4000-6000 miners die every year. Best of all was methane an unwelcome byproduct of coal mining, which released the Chinese in the atmosphere exacerbates an already atrocious air pollution crisis.
When the Chinese CBM began to realize was a larger percentage of the US gas production has, they wanted to develop their own vast resources. Finally, the Chinese pragmatists. Why pay through the nose to import LNG, when that methane every throw? In 2004, coalbed methane accounted for 8 percent of US gas production. This is mandated in its energy mix in the eleventh five-year plan for the role of gas the same percentage number China. And as we have mentioned in previous articles, China has idled as much as 40 percent of its gas-fired plants because it could not obtain sufficient gas supplies.
methane or C4, which is a more pure gas than conventional gas, is found within the carbon lattice of coal at a molecular level. The less "sweet" natural gas that is found in more conventional fields, generated by hydrocarbon source rocks and trapped in a porous and permeable reservoir rock, such as carbonate reserve or sandstone. Water pressure holds coalbed methane in place, the new drilling technology needed to efficiently extract.
coalbed methane extract, a company drills wells into the coal seam and then punching and breaking the coal seams. Increasing this process permeability by water able to be pumped out of the coal seam. During this de-watering process, the pressure of the gas in place keeps reducing. This pressure differential vents the gas through the fracture systems into the well. Voila! What had miners were killed and China's atmosphere pollute now to power could be used gas-fired power plants.
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