Leyshon Resources finds multiple gas pay zones in central China 

(MENAFN - ProactiveInvestors - Australia) Cashed up Leyshon Resources (ASX/AIM:LRL) has continued its recent run of drilling success, encountering multiple gas pay zones at the ZJS5 well in central China.

The company has A47 million in cash and 249 million ordinary shares on issue (approximately A 19 cents per share and 12 pence per share). It trades at 0.23 last sale.

The well was drilled to total a depth of 2,155 metres, then wire line logged and side wall core samples taken by contractor China Oilfield Services Limited.

The analysis of the logs and samples is ongoing however initial results have indicated that about 56.4 metres pay intervals have been encountered.

In particular, around 30.8 metres of the 56.4 metres have exhibited relative high porosity measurements which indicate that these zones could have the potential to flow gas at commercial rates.

Following the open hole logging program, a production casing string has been installed which will allow multiple opportunities to conduct flow tests on the potential pay zones.

Management expects to conclude testing the first of the potential pay zones by the end of the year.

The second well in the program, ZJS6, is expected to spud shortly with well completion scheduled towards the end of the year.

Both wells are located within approximately 10 kilometres of a tie-in point on the recently commissioned Lin-Lin pipeline which supplies the growing demand in Shanxi Province where well head contracts have recently been struck in the US 6 - 7.5 per mscf range.

PAPL has a 100% interest in the exploration phase of the Production Sharing Contract with PetroChina, which has the right to buy back a 40% interest at the development stage.