Elixir Energy Ltd (ASX:EXR) is encouraged by progress at the 100%-owned Nomgon IX Coal Bed Methane (CBM) Production Sharing Contract (PSC) in the South Gobi Basin of Mongolia with two wells intersecting gassy coal.
At the Big Slope-7 appraisal well, which was spudded just over a week ago, Elixir has already intersected gaseous coal and the well is now undergoing Injectivity Fall Off Testing (IFOT) to measure permeability in this upper coal section.
Over at the Bluebill-1 exploration well where drilling is ongoing, the company has also intersected gaseous coal.
“Encouraging” results
"Drilling results from both wells underway are encouraging – if successful [they] could open up significant new areas to the east and west of Nomgon,” Elixir’s managing director Neil Young said.
Location map of Elixir activity in Mongolia.
Big Slope 7 is to the west of the Big Slope-4 well drilled in 2022, which intersected more than 50 metres of coal, and has a planned total depth (TD) of 800 metres.
Mongolian contractor
This well is being drilled by Mongolian drilling contractor Erdene Drilling LLC (ED) and is the first of a number of wells ED is contracted to Elixir for drill in the region.
“It is a pleasure this year to be working with Erdene Drilling again – they were pioneer drilling contractors with us from 2019 to 2021 – but took a break from CBM work for a year after that,” Young said.
"We look forward to the results of the appraisal drilling program over the coming months.”
Pilot test progress
Meanwhile, operations at the Nomgon extended pilot test continue, with water production ongoing at sustained rates.
Planning for a new well in the pilot is advancing, with contract negotiations with drilling contractors and various regulatory processes well underway.
Last month Elixir engaged the services of the THREE60 Energy Group to assist with production management of the pilot and to boost the company’s drilling support.
About THREE60 Energy
THREE60 Energy is a leading global energy services provider, delivering comprehensive solutions across the entire energy lifecycle.
Leveraging a unique blend of expertise in subsurface, drilling & completions, facilities engineering, construction & commissioning and operations, THREE60 Energy empowers clients to optimise their assets and improve sustainability.