- Elixir Energy (EXR) is pushing ahead with plans to create Mongolia's first gas-fired power generation project, using coal bed methane (CBM)
- The energy stock has hired Clarke Energy to begin work on a feasibility study for its Nomgon gas fired power project
- It's also received support from Mongolia's Energy Department, executing a memorandum of understanding (MOU) to develop a gas-fired project
- Additionally, the company has announced the results from an initial independent Contingent Resources estimate
- The estimate, which looked at EXR's work to date in the Nomgon sub-basin area, found there was sufficient resources for the life of the power plant
- Shares in Elixir Energy are up 4.29 per cent at 36.5 cents
Elixir Energy (EXR) has announced it will push ahead with plans to create Mongolia's first gas-fired power generation project, using coal bed methane (CBM).
The energy stock released a wide-ranging update on its newly named Nomgon gas fired power project, where field work recently began. The project includes a Nomgon IX CBM production sharing contract (PSC).
In order to get the project up and running, the company has hired Australian-based business Clarke Energy to begin work on a feasibility study for Nomgon.
Clarke, which is a subsidiary of U.S. private business KOEHLER Company, describes itself a leader in the engineering, procurement and construction of Jenbacher gas-engine-based power station projects using CBM.
Along with greenlighting a feasibility study, Elixir has also revealed it's received support from Mongolia's Energy Department, executing a memorandum of understanding (MOU) with the agency to develop a gas-fired project.
Commenting on the MOU, EXR Managing Director Neil Young said if the first project proves viable, he expects a lot of interest from the government and private sector in pursuing similar assets.
"We now look forward to working with the Mongolian Government and Clarke Energy to pursue the development of Mongolia’s first gas fired power station," Neil said.
"Elixir’s Directors have considerable experience in CBM to power projects in Australia and consider that there is an excellent fit for such projects with the
stage we have now got to in Mongolia," he added.
In addition to the MOU and feasibility study, Elixir has used today's update to announce the results from an initial independent contingent resources estimate.
The estimate, which looked at EXR's work to date in the Nomgon sub-basin area, found there was sufficient resources available for the life of the power plant.
"Our initial Contingent Resource booking – the first of its kind in the country – is focused on supplying this project," the MD explained.
"Our “rinse and repeat” model for the identification, appraisal and then production of CBMin the vast Nomgon PSC area has received major validation with this key milestone and the plan is to repeat it time and time again," he said.
Elixir Energy shares are trading 4.29 per cent in the green at 36.5 cents per share at 10:52 am AEST.