TMK Mongolian CSG gas field pumps out record | Australian Markets

TMK Vitality has kicked off the new yr with a bang after revealing a jaw-dropping 300 per cent increase in whole gasoline manufacturing for January in comparison with the earlier month.

The company’s flagship Gurvantes XXXV coal seam gasoline project in Southern Mongolia has delivered record-breaking output, with final month’s gasoline manufacturing leaping 40pc above its earlier best-ever month-to-month report.

Wells LF-04, LF-05 and LF-06 in TMK’s newly drilled pilot manufacturing project got here online on January 10. The three pilots and its present wells have produced an spectacular 8000 cubic metres of gasoline.

The numbers are all of the more hanging given the new wells additionally confronted a few hiccups – nicely LF-05 needed a pump cleanout after turning into clogged up with downhole waste and nicely LF-06 needed a greater pump.

In one other constructive signal for the project, water retrieval linked to nicely permeability and better gasoline manufacturing elevated by 230pc to 1000 barrels a day on the pilot nicely project. The company says the extra water manufacturing has additionally had a recharging impact on different wells. Specifically, LF-02 has quadrupled gasoline manufacturing and remains to be climbing.

Regardless of not having all of the new wells on manufacturing for the entire of January 2025, the project nonetheless managed to ship a report month of manufacturing. The constructive indicators we’re observing point out that the project stays nicely on observe to satisfy our goal of delivering a commercially vital final result this yr.

Ferguson mentioned manufacturing was anticipated to materially increase by March, nevertheless, he emphasised it’s nonetheless early days within the analysis course of and too quickly to foretell when or at what degree peak manufacturing might be reached.

Coal seam gasoline wells are distinct from typical gasoline wells, that are sometimes drilled into reservoirs trapped within rock buildings capped with a seal. As an alternative, CSG or unconventional wells are drilled straight into coal seams.

To unlock the gasoline, operators use a fracture stimulation approach often called fracking through which water, nitrogen, carbon dioxide and ceramic sands are injected into the nicely beneath strain to open and clear a pathway for gasoline to circulation.

As dewatering progresses the gasoline begins to circulation, typically delivering sturdy initial charges which then drop off. To minimise drop-off, coal seam gasoline tasks sometimes require many more wells than typical gasoline fields. As a result of horizontal drilling exposes a a lot greater floor space, often more gasoline may be extracted over time.

With home energy technology on the high of the agenda, TMK’s progress is of enormous curiosity to the Mongolian authorities. The company is within the box seat to turn into the primary coal seam gasoline producer in-country with a best estimate (2C) contingent useful resource of 1.2 trillion cubic ft of gasoline.

In readiness for full manufacturing, the company signed a memorandum of understanding with German energy technology company Jens Energie LLC to import a gas-fired energy plant at no price to TMK. The plant is at present en path to web site.

Set up of the ability generator can be at Jens’ price. In exchange, TMK must ship 5000 cubic metres of gasoline per day by the top of the financial yr.

When key manufacturing targets are hit, the German-based company has agreed to take up to fifteen,000 cubic metres of gasoline per day from TMK throughout an initial two-year deal, with an option to increase for a additional two years.

Past securing a main off-take deal, Jens may even deal with all regulatory paperwork leaving TMK Vitality to do what it does best – uncover and produce gasoline.

As TMK gears up to full manufacturing, the company should be sporting a quiet smile. Having struck a deal solely a yr in the past to buy Talon Vitality’s 33pc earned curiosity within the project for the princely sum of $2 million in TMK shares, it was then repaid $850,000 by Talon to satisfy its three way partnership obligations.

TMK is now solely weeks away from doubtlessly producing substantial money circulation because it turns into Mongolia’s first industrial coal seam gasoline producer, all with out breaking the bank. That’s a good outcome if you will get it.

Is your ASX-listed company doing one thing fascinating? Contact: [email protected]