TMK Energy (ASX:TMK) has this week entered into a memorandum of understanding with the Mongolian Ministry of Energy to study the acceleration of domestically produced natural gas as a fuel source.
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The Australian junior is a pioneer in the development of the large coal seam gas (CSG) potential contained in Mongolia’s Gobi desert region and owner of the sizeable Gurvantes XXXV project there.
Under the strategic MoU, TMK and the ministry will evaluate the inclusion of Mongolia’s CSG resources into national medium and long-term energy policy.
TMK CEO, Dougal Ferguson, said the MoU will initially see the fast-tracking of a baseline study on the use of natural gas for peak load power generation. “This MoU represents a significant step forward for TMK and the Mongolian government and recognition for the nascent CSG industry in Mongolia,” he explained.
He continued: “It signals further recognition by the government that natural gas remains a viable alternative to coal to further improve the long-term energy security of Mongolia and diversify its domestic energy sources.”
TMK recently reported it had set a record for daily gas production at its Gurvantes XXXV project of around 674 cubic metres of gas in late January.
The project’s gas production during January averaged approximately 593 cubic metres per day, a 13% increase over December’s record average.
The company also reported LF-07, the most recent well drilled and one of the highest (up-dip) wells in the Gurvantes structure, became the first well in the field to exceed 10,000 stranded cubic feet per day (scfd) of gas.
“Natural gas has the potential to provide a cleaner, efficient and highly responsive energy source that can complement existing and future infrastructure and reduce reliance on imported electricity. This initiative also supports the broader objective of integrating domestically produced CSG into Mongolia’s medium and long-term energy policy framework,” Mr Ferguson said.
Mongolia is one of the world’s fastest-growing economies today, largely driven by a massive wealth of mineral resources.
TMK is steady at 9.1cps today.
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