Elixir confident in targeting new sub-basin

By Trevor Hoey. Published at Jan 16, 2020, in Energy

Elixir Energy Limited (ASX:EXR) has provided an update in relation to its upcoming drilling operations in its 100% owned Nomgon IX Coal Bed Methane Production Sharing Contract in Mongolia, in particular highlighting the prospects of Nomgon-1, a new well that has just spudded.

This is the company’s second well in its two core-hole drilling program.

Nomgon-1 lies approximately 37 kilometres to the south-west of the recently drilled Ugtaal-1 well and is situated in a different Permian sub-basin to the latter.

Encouragingly, this is one of many such sub-basins in the very large Nomgon IX PSC, underlining the importance of Elixir’s 30,000 square kilometre land holding that covers a major Permian coal bearing basin and the options that it offers as the group’s exploration strategy unfolds.

Management has a good understanding of the location where Nomgon-1 is situated as it was first identified as being prospective for coal seam gas (CSG) exploration by Elixir’s subsidiary company four years ago when it undertook initial on-ground prospecting work across the PSC area.

Recent field work has re-affirmed the location’s strong potential, with the confirmation of thick outcropping coal seams that demonstrate good cleating and coal quality to the naked eye.

Assessment of Ugtaal-1 assists in targeting Nomgon-1

Transitioning to Nomgon-1 is timely as management noted today that the results from Ugtaal-1, which was its key focus recently, were at the lower end of expectations due to factors such as poorer than anticipated coal quality.

While preliminary findings also reflected this lower than expected coal quality, the process of continuing with ongoing desorption work and supplementary laboratory testing is providing valuable information for the company’s ongoing exploration efforts over the multiple targeted Permian sub-basins within the overall PSC area.

Release of 2020 exploration strategy imminent

Management’s plans for 2020 have recently been proposed to Mongolia’s petroleum regulator, as required under the terms of its PSC.

These include a mixture of further low cost seismic and drilling.

By their nature, these will be dynamic over the course of the year as the two processes feed off each other and the final results of the current program.

A mandatory formal annual meeting with the regulator is scheduled to be held towards the end of January.

The 2019 results and 2020 plans will be discussed at that meeting.

Expressing his confidence regarding the Nomgon-1 drilling program, Elixir’s managing director Neil Young said, “We are looking forward to the last of the core-hole wells planned for our first year’s drilling campaign.

‘’The Nomgon-1 well is one which we are highly confident will intersect coal seams at depth, providing a good first test of a different sub-basin in the PSC.”

View Our Investment Portfolios

S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

Publishers Notice

The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.

Australian ASX Small Cap stocks | Why Finfeed.com is Australia’s leading small cap publication

Founded seven years ago, Finfeed.com is Australia’s leading and longest standing website for investor and finance news, education and expert opinion.

Published by StocksDigital, Finfeed was created to report daily on the comings and goings of ASX listed stocks in the small cap market.

As the first digital publication dedicated specifically to this space, Finfeed soon became the most trusted publication in the market, quickly garnering over two million page views – a number that continues to rise.

Finfeed.com provides its readers with informative articles that tackle the latest in market moving #ASX small cap news, plus exclusive content you won’t find anywhere else. It is aimed at those with an interest in investing, market education, company performance, start-ups and much more.

Finfeed.com is the only media organisation operating under the strength of a Financial Services License and is backed by leading journalists and analysts all with brands of their own.

The website aims to inform, educate and entertain with content that drills down into the heart of financial matters.

Finfeed is a leading source of investor and market information, with everything investors need to know about how to invest written in a way that anyone can understand. 

Over the years, the website has expanded beyond exclusively reporting on small caps, to profile Australia’s leading ASX listed small, mid and large caps as well as some of the country’s most successful CEOs and business leaders to find out what makes them tick.

Every day you will find fresh content covering:

Fast Facts

Over 4,000 articles published

Over 2.3 Million Page Views and counting

Over 10,000 followers on social media

Subscriber list growing by 2% monthly

Thanks for subscribing!