Work at Jade Gas’ Mongolain project. Source: Jade Gas
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  • Jade Gas (JGH) has struck 58 metres of gas-bearing coal at its Red Lake-1 well — the first of six wells to be drilled by the company in the Tavantolgoi XXXIII oil basin in Mongolia
  • The well, which reached a total depth of 1011.5 metres, targeted three coal seams of interest during drilling — all of which were intersected and cored
  • Jade says the coring program delivered 145 metres of coal, of which 58 metres had gas coming off the recovered core
  • CEO Chris Jamieson says the company is “greatly encouraged” by the first well and, as such, will expedite its planned drilling campaign by contracting a second drilling company
  • Shares in Jade Gas were trading grey at 8.3 cents each at 11:13 am AEDT

Jade Gas (JGH) has struck 58 metres of gas-bearing coal at its Red Lake-1 well — the first of six wells to be drilled by the company in the Tavantolgoi XXXIII oil basin in Mongolia.

The well has reached its total depth of 1011.5 metres, with Jade targeting three coal seams of interest during drilling. The company this morning told shareholders all three coal seams of interest were intersected and cored between 730 metres and 970 metres deep.

This coring program delivered 145 metres of coal, of which 58 metres had gas coming off the recovered core.

Jade CEO Chris Jamieson said the company was “greatly encouraged” by the amount of gas-bearing coal seen in this first well.

“Most importantly, Red Lake-1 intersected all coal seams of interest which have exceeded expectations in terms of thickness,” Mr Jamieson said.

He added that further testing would be needed in order to better understand the gas content, permeability, and saturation of the coal seams. Jade will gather this information over the coming months through gas desorption, permeability testing, and isotherm analysis work.

“The strong results from Red Lake-1 have driven our push to expedite the program, and to this end, we have engaged a second drilling company which will drill two of the six wells planned in this important drilling campaign,” Mr Jamieson said.

The second well to be drilled by Jade in the area, Red Lake-2, lies roughly two kilometres west of Red Lake-1. Jade said it expected the well to spud in the coming weeks, with a planned total depth of roughly 800 metres. This well will target the same three coal seams of interest.

Meanwhile, the third well of the program will also spud over the next few weeks and is expected to be drilled to a total depth of around 730 metres. In both cases, drilling will take up to a month to complete.

Shares in Jade Gas were trading grey at 8.3 cents each at 11:13 am AEDT. The company has a $46.3 million market cap.

JGH by the numbers
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