Linc Energy of Australia has made a strategic acquisition by acquiring a 60% controlling interest in Yerostigaz in Uzbekistan. Yerostigaz was a vital part of the former Soviet Union’s Underground Coal Gasification (UCG) program and has been operating continuously since 1964.
Yerostigaz is the only commercial UCG operation in the world (see attached Fact Sheet). The UCG gas produced is fed into a power station which is situated adjacent to the Yerostigaz operation in Angren.
Linc Energy’s CEO Mr Peter Bond said "The Yerostigaz acquisition is a huge achievement for Linc Energy. It allows Linc Energy to have effective ownership of a significant piece of the intellectual property and know-how of UCG as well as adding significant engineering capability and history that only comes from an organisation as old and distinguished as Yerostigaz".
"Last year Yerostigaz generated a small profit but the addition of its 230 employees to Linc Energy’s workforce and the intellectual property is worth a lot more to us at this time," said Mr Bond.
Linc Energy has already commenced an exchange program, swapping Yerostigaz experts to work at its site in Chinchilla and sending some of its own UCG staff to Yerostigaz in Uzbekistan to experience the site first-hand.
Commenting on the transaction, Mr Brian Johnson, Chairman of Linc Energy said "Underground Coal Gasification is emerging as one of the world’s great opportunities to unlock huge amounts of potential and inexpensive energy. With the Yerostigaz acquisition, Linc Energy has emerged as the largest and most commercial operator of UCG in the world today."
"With the additional expertise and employees to handle an increase in commercial operations, Linc Energy can now go forward to expand UCG operations in several other locations around the world, including China, India, USA and Australia."
Yerostigaz is capable of producing in excess of one million cubic metres of syn-gas per day, which is currently used for power generation. The acquisition of Yerostigaz was financed via a combination of shares and cash and comes on the back of several other Linc Energy achievements including the recent investment of US$5 million by Marubeni Coal, a wholly-owned subsidiary of Marubeni Corporation.