EXR’s Nomgon-2 Gas Well
Exceeds ExpectationsElixir Energy (ASX: EXR) has reported impressive gas content and permeability results from its 100%-owned coal seam gas (CSG) Production Sharing Contract (PSC) on the Mongolia-China border.
The data will expand EXR’s contingent resource base at the PSC’s Nomgon sub-basin — targeted for year’s end. This will provide a basis for what could be a very modestly costed pilot production test in 2021.
After achieving Mongolia’s first ever gas discovery in February at the Nomgon-1 well, EXR rapidly followed up with the Nomgon-2 appraisal well.
Both wells encountered exceptionally thick coals, while results of this follow up appraisal well exceeded expectations, coming in even better than those from the first well.
In addition to the Nomgon sub-basin, the gigantic licence area — the size of “a small European country” — likely hosts numerous coal-bearing sub-basins that are prospective for coal seam gas.
The company is proving up the wider potential in its vast PSC block, with plans to ultimately bring in high quality partners who can help bring a very large potential resource into production.
Here at Next Investors we are long term shareholders of EXR, naming it our ‘Pick of the Year’ in July 2019 and doubling down on our investment in May.
That investment is clearly paying off given the recent price action, yet we are looking further ahead, eyeing the longer-term potential of Elixir’s 30,000km2 (7 million acre) landholding.
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