TMK Energy (ASX:TMK) has reported what it describes as ‘early signs’ of gas desorption at its Gurvantes XXXV Coal Seam Gas Project in Mongolia’s South Gobi Basin.
The company’s seven-well pilot project has delivered two gas breakthrough events in the past six months, with TMK saying well LF-07 has performed above expectations. Month-on-month gas production rates have increased over the past 12 months as the revised reservoir management plan takes effect.
“The pilot area water production is consistently lowering reservoir pressure toward the predicted desorption pressure,” the company says in its latest investor presentation.
TMK says its reservoir simulation model closely tracks actual measured pressure reduction, with desorption dependent on total water produced. The company says increasing water production will further accelerate the desorption timeframe.
TMK says recent gas production spikes associated with desorption suggest current well spacing is sufficient at the pilot project. This has prompted the company to revise its 2026 work program, reducing planned new pilot wells from three to two while introducing well re-completions.
The revised program maintains flexibility to drill up to two new pilot wells whilst conducting a minimum of three well re-completions, with options to increase to six. The smaller annular size completion design can be retrofitted to existing wells at a fraction of the cost of new wells.
TMK says the revised approach delivers a minimum of four new wellbores for the same capital cost as three new pilot wells, with potential for up to eight new wellbores. The capital budget ranges from US$1.3 million–1.8 million ($1.87 million–2.59 million), down from the original US$1.8 million.
The Gurvantes XXXV project covers approximately 8,400km² and holds 1.2 trillion cubic feet (Tcf) of contingent gas resources, certified by Netherland, Sewell & Associates. The company also reports 5.3Tcf of prospective resources.
TMK has partnered with Dashvaanjil Group to advance commercialisation of the project.
The Gurvantes XXXV Coal Seam Gas Project is located near northern China and existing regional infrastructure. TMK maintains 100% ownership and operatorship of the project under a production sharing contract awarded in 2021. The company plans to commence its 2026 drilling program in August 2026, focusing on maximising gas production from existing pilot wells while meeting minimum work commitments.
Write to France Pinzon at Mining.com.au
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