- Elixir Energy (EXR) has received test results from coal taken from Nomgon-1 well, and found them to be near fully gas saturated
- This means the Mongolian coal seam gas project's pilot production design could be simpler and cheaper than expected
- Early gas generation is also expected, as no lengthy water-producing phase is needed
- Elixir CEO has labelled the results as 'excellent' and suggests 'a potentially very energy-intensive' resource has been discovered
- Shares in the international oil and gas company closed up 2.33 per cent, at 4.4 cents per share
Oil and gas company Elixir Energy (EXR) is celebrating after absorption results showed coal taken from its Nomgon-1 well was near fully gas saturated, potentially saving the company future time and money.
In essence, the absorption results mean Elixir could use a simpler and cheaper pilot design for the Mongolian coal seam gas project. It also points to the possibility of potential early gas production.
“Identifying fully gas saturated coals in Nomgon-1 is an excellent result, given the very positive consequences this should have for coal seam gas pilot production testing and ultimately a field development," said Managing Director Neil Young.
"Nomgon-1’s very thick coals that have now been identified as being fully gas saturated suggest a potentially very energy-intensive per acre resource has been found," he added.
Only one coal sample was tested in the Chinese lab, despite multiple samples being taken, as COVID-19 restrictions delayed them from arriving on time.
Elixir said further tests will be undertaken on the remaining samples, to confirm the positive initial result of near fully gas saturation.
The oil and gas company also revealed today its Nomgon-2 well is due to spud shortly, meaning main drilling would soon be completed at the well.
Elixir is very hopeful it will return similar absorption results as Nomgon-1. The company said samples from this well would either be analysed on-site or sent to laboratories in Mongolia or neighbouring China.
Shares in the company closed up 2.33 per cent today, July 8, 2020, following the announcement, at 4.4 cents each.