Elixir Energy Ltd (ASX:EXR) has released an update on the Nomgon coal bed methane pilot project underway in its 100%-owned Nomgon IX CBM production sharing contract in Mongolia.
Following the drilling and completion of the Nomgon-8 and Nomgon-9 pilot wells last month by contractor Major Drilling, all pumping related down-hole and surface facilities have been installed at the Nomgon pilot project.
Gas breakthrough
Pumping of fluid from these two wells commenced earlier this week. Gas breakthrough has already occurred and the gas is now being flared.
Elixir managing director Neil Young said: “Flaring gas so soon after starting our production pilot is an incredible result for the company.
“This is a first for Mongolia and we aim to establish a commercial flow rate in the months to come.
“Our on-site team – with great assistance as always from their Australian counterparts – has done a fantastic job in installing pilot facilities to a world class standard and we thank them accordingly.”
Gas-saturated coal
The early breakthrough of gas is consistent with the company’s interpretation that the coal is close to 100% gas-saturated.
In the coming days, as the gas rate stabilises, the company will start measuring the rate.
In the meantime, the company continues appraisal drilling in the Big Slope depo-centre.
The Big Slope-3 and Big Slope-4 wells have to date intersected 21.4 and 38 metres of gassy coal respectively and are expected to reach their target depths within the next week or so.
Gas contents measured from these wells have followed up successfully on the high figures measured in Big Slope-2, with Big Slope-3 recording a peak of 9.2 cubic metres per tonne on a raw gas basis – the highest so far within the Nomgon IX PSC.
Mechanical issues
The pace of drilling at Big Slope has been affected by various mechanical and geological issues.
At this stage, one of the two wells is exhibiting slugging and may require workover in the coming days. Elixir has enlisted Major Drilling to deploy a rig with stronger drilling capabilities to the well, and it will spud once the potential workover is done.
The company regards this as an opportunity for valuable learnings to apply to future drilling in what is a highly promising depo-centre.