As detailed in the RMP, a planned four-day shut-in confirmed that the reservoir pressure is continuing to fall with continued water extraction. Although these planned shut-ins reduce overall monthly gas production, they are essential to confirm that reservoir pressure continues to decline toward the critical desorption pressure.
TMK Energy chief executive officer Dougal Ferguson said:“We have now had four successive months with gas production levels increasing, but more importantly, no workovers, continued good water production and continued reservoir pressure decline.”
In parallel with desorption activities, the company also wrapped up its 2025 exploration program, meeting a key commitment under its licence.
Two exploration wells were drilled east of the pilot project in the Soumber area. The first hit about 35 metres of coal at depths of up to 300 metres, while the second intersected around 11 metres of coal before drilling had to stop at 249 metres due to unstable ground.
The company says both wells delivered encouraging results, confirming that the coal seam gas system extends east of Nariin Sukhait, which forms part of the main Gurvantes project area. Gas levels were lower than at TMK’s pilot site, which management attributed to shallower coal seams.
Work is now underway to map and interpret the data in more detail and to target the same coal seams at greater depths in future drilling, where gas content is expected to be higher.
A third well was drilled inside the pilot project area to gather more information. That well intersected thick, gas-rich coal seams similar to those seen in the existing pilot wells. Core samples were collected and sealed on site for gas testing.
Gurvantes spans 8400 square kilometres in the South Gobi Desert in Mongolia, less than 50 kilometres from China’s Shivee Khuren border crossing and close to important Chinese gas infrastructure.
The area is known for its large coal deposits and, therefore, is ideal for coal seam gas production, as geological processes of heat and pressure transform organic matter in coal into methane. The gas field contains a 1.2 trillion cubic feet (Tcf) contingent resource and offers significant upside potential, with a 5.3Tcf prospective resource still to be explored.
Moving forward, TMK has begun planning a 2026 drilling program to accelerate depressurisation further and increase gas production. Reservoir simulation modelling has provided clear insights into the optimal locations for these additional wells.
With near-record gas now flowing, new exploration kicking off and field-wide planning hitting its straps, TMK looks to be shifting gears in Mongolia’s South Gobi Basin. The project appears to be edging closer to becoming a commercial-scale producer and the punters will no doubt be watching closely.
Is your ASX-listed company doing something interesting? Contact: mattbirney@bullsnbears.com.au
