TMK Energy is pushing ahead with its second pilot well, Lucky Fox-2, after pulling up 60m of gaseous coal from its maiden Lucky Fox-1 production well at its Gurvantes XXXV coal seam gas (CSG) project in Mongolia.
Lucky Fox-2 was spudded earlier this week and has been drilled down to almost 140m.
The Perth-based oil and gas explorer is plunging three pilot production wells spaced about 200m apart into the highly-prospective coal seam. The wells are centred on an exploration well, known as Snow Leopard-2, which was drilled in last year’s exploration campaign that returned 91m of gaseous coal recording 97 per cent methane content.
Once drilling is completed, the company is set to install downhole pumps and connect surface facilities to the wells. TMK expects its first gas breakthrough within one or two months from the commissioning of the pilot well pumps, which is slated for the third quarter of this year after a period of controlled dewatering of the wells.
Based on independent modelling by SLB (formerly Schlumberger), TMK anticipates its gas flow rate to build over a six-month production test, enabling the company to assess if gas rates are commercially viable for power generation.
Fellow Aussie, Talon Energy, is tipping in US$3.15m (AU$4.7m) and is destined to foot the bulk of the US$3.5m (AU$5.2m) bill for the pilot well program. Talon’s contribution fulfills its two-stage farm-in deal to earn a 33 per cent share of the project.
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. TMK Energy chief executive officer Brendan Stats
The company’s Gurvantes XXXV acreage covers whopping 8400 square kilometres of Mongolia’s South Gobi basin, which is shaping up to be one of the world’s most prospective CSG basins. Within the area, there are six active coal mining operations, 26 coal mining leases and many coal exploration licences, which together have defined a substantial coal resource.
Since acquiring the tenure in 2021, TMK has been moving at a fair clip on the Asian subcontinent, completing a maiden seven-hole exploration program and shoring up a massive contingent CSG resource of 1.2 trillion cubic feet (2C).
TMK’s goal is to produce gas initially for coal mining operations in the project’s vicinity, before expanding to other areas of Mongolia and eventually for export to China – one of the world’s biggest markets for gas.
Ulaanbaatar, Mongolia’s capital city and home to a half of the nation’s population, lays claims to the unenviable moniker of being one of the most heavily-polluted cities in the world – fuelled mostly by the burning of coal for cooking and heating. With no local commercial gas facilities, forcing a requirement for cylinders to be sourced from neighbouring Russia, there is a growing political push to seek greener and more secure and reliable forms of energy generation to reduce the nation’s toxicity of air pollution.
As TMK gears up to turn the tap on its Gurvantes XXXV pilot production wells later this year, in a globally-significant CSG basin, it looks to have more than one eager trading partner lining up for its sought-after gas product.
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