TMK is progressing the pilot production program at its Gurvantes XXXV Project in Mongolia’s south Gobi Desert, with the drilling of the second of three production wells.

Lucky Fox-2, which was spudded earlier this week, is located about 200m east-southeast of the Lucky Fox-1 well which was completed in the production interval, which comprises about 60m of gassy coal.

TMK Energy (ASX:TMK) is also carrying out site works to allow installation of the equipment necessary to undertake a six-month production test upon completion of the drilling and pump installation activities, all of which are expected to be completed towards the end of June 2023.

Based on data from its Snow Leopard-2 exploration well, which the production wells are being drilled around, the company is confident that the de-watering process will be relatively short.

This will in turn lead to early gas breakthrough from the Lucky Fox production well complex once the wells are all placed on pump and fully operational.

“With the second well now underway, we are quickly moving towards what will be an exciting period for the company,” chief executive officer Brendan Stats said.

“Based on the results to date, I am confident that the project will deliver gas breakthrough in a relatively short period of time and that we will be able to take the next steps towards early commercialisation, in turn demonstrating the potential of the Gurvantes Project.” 

Big coal seam gas potential

Gurvantes XXXV covers 8,400km2 less than 20km from Mongolia’s border with China and is close to the extensive Northern China gas transmission and distribution network.

It is also close to several large-scale mining operations with high energy needs.

Exploration has already defined a best estimate (2C) Contingent Resource of 1.2 trillion cubic feet of coal seam gas – the largest resource of its kind in Mongolia.

TMK already has a cooperation and electricity offtake agreement in place with Mongol Alt LLC (MAK), which currently owns and operates the coal mining lease where Gurvantes XXXV is located.

This places the company in the comfortable position of having a ready customer once it produces commercial quantities of gas.

 

 

 

This article was developed in collaboration with TMK Energy, a Stockhead advertiser at the time of publishing.

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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