Page 8 - AsianOil Week 46

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Elixir kicks off second Mongolian well
PROJECTS & COMPANIES
AUSTRALIAN-LISTED junior Elixir Energy has said it has kicked off the second well in a two-well drilling programme on its coal-bed methane (CBM) block in Mongolia.
The company said on November 18 that it had spudded the Ugtaal-1 core-hole at its wholly owned Nomgon IX production-sharing contract (PSC) on November 11.
Elixir added that Ugtaal-1 had reached a depth of 122 metres, intersecting lithologies that included conglomerates, carbonaceous mud- stones and thin coal stringers.
Managing director Neil Young said: “With the spudding of the Ugtaal-1 core-hole we have now commenced our key well for 2019. We anticipate the well reaching the Permian section later this week, after which we will start testing coal cores for their gas content.”
Nomgon IX covers 30,000 square km of land in southern Mongolia and lies close to the border with China. The company signed its PSC, which includes a 10 year plus exploration period, in September 2018.
In addition to Ugtaal-1, Elixir has begun analysis on the findings from its first well – the BO-CH-1 chip-hole. Elixir said the well had demonstrated gas in the system, coal seams that would be considered productive in Australia as well as natural fracturing that could support “good permeability”.
The company said last week that BO-CH-1 had reached a total depth of 738 metres by November 10, after which the well was logged. Elixir noted that the first chip-hole had inter- sected a 490-metre coal-prospective Permian section, which exceeded the company’s expec- tations. It added that preliminary interpretation had indicated a gross carbonaceous section of 30 metres, of which 7 metres was net coal. The thickest coal penetration was 4 metres thick, which was in line with expectations.
Elixir said on November 18 that its drilling programme would consist of two fully tested core-holes, with the option for a third, that would support a contingent resource assessment in early 2020.™
OCEANIA
PNG set to start P’nyang renegotiations with ExxonMobil
PROJECTS & COMPANIES
THE government of Papua New Guinea (PNG) is set to start talks with ExxonMobil in an attempt to negotiate better terms for the P’Nyang gas project. PNG Minister for Petro- leum Kerenga Kua said an agreement could be expected by the end of November if the talks are successful.
The P’Nyang gas project, located in the Western Highlands, will support a three-train expansion of ExxonMobil’s PNG LNG termi- nal at Caution Bay near Port Moresby. One train would use natural gas from the P’nyang and PNG LNG fields as feedstock, while two trains would use gas associated with the Papua LNG project.
The renegotiation comes as the new PNG government attempts to secure more favourable terms from developers of mineral and petroleum resources operating in the country, in a bid to alleviate poverty.
A separate LNG agreement with France’s Total for the Papua LNG project – in which ExxonMobil is also involved – was renegoti- ated in September. The French company only had to make minor concessions in order to secure the new deal, but Kua said at the time
that the PNG government would press Exx- onMobil Corp for “far better” terms on the P’nyang gas project.
“We look forward to working with the government of PNG to progress the required gas agreement for the P’nyang project ahead of potential decisions on FEED [front-end engineering and design] for the three-train development at the existing LNG plant site,” ExxonMobil said in a statement that was reported by Reuters.
Last month, Kua stated that the development of the P’nyang gas field, along with a third LNG train at the PNG LNG terminal, would be treated as an integrated stand-alone gas project under the terms of an agreement that would be separate from the deals governing the initial PNG LNG and the new Papua LNG projects.
Kua has previously said that PNG’s gov- ernment has the option of deferring the P’nyang project until proposed new oil and gas legislation and a revised fiscal regime are introduced in 2020. But he added that it was more beneficial to have the P’nyang agreement negotiated and signed under the existing Oil and Gas Act 1998.™
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w w w . N E W S B A S E . c o m Week 46 20•November•2019