Leyshon Resources (LON:LRL) is a dual listed (ASX/AIM:LRL) China focused resource company focused on the 708 km2 Zijinshan block located on the Eastern flank of the prolific Ordos Basin, which is China's second largest and regarded by Leyshon as one of the world's major gas producing basins.  Leyshon Resources are operating the block through its recent acquisition Pacific Asia Petroleum Limited, which Leyshon acquired in August 2012 for US$ 2.5 million in cash and the issue of 10 million fully paid ordinary shares.

Following the first two drills and the Chinese New Year break, Paul Atherley the Leyshon Resources Managing Director has taken time out to discuss various aspects of the business, including, operating in China, the Zijinshan block, 2013 work programme and funding.

As always, when looking at oil and gas exploration activity the risk element is high, and a dry or non-commercial well almost certainly results in a severe share price drop. Oil and gas exploration activity is also very costly business, hence the future economic outlook and the ability of an exploration and dev elopement company to raise future capital to fund licence commitments along with its overheads also needs serious consideration, alongside factors such as oil/gas price risk, political risk, country/region stability etc.

 

Q1. Briefly, could you describe Leyshon Resources business model and mission?

We are seeking to generate very high shareholder returns by making investments in early stage exploration and development projects in the energy sector that demonstrate potential to become world class projects.

 

Q2. Why the focus on China? And, how do you find operating in China?

China is the major driver in world growth and is the biggest consumer in the energy sector. In short it is where the demand and demand growth is, making it the ideal place to be. However, there are very high barriers to entry for foreign companies in China and it takes considerable time and effort to understand how to be successful in business. We have been based in China for nearly ten years and have built a talented Chinese team with a good track record and an excellent depth of knowledge of doing business in China, which we view as a key element to being successful. We have already made $50 million from developing and selling a gold project so we are confident we…

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