EXR's project is on the border of the clean-energy hungry China, seeking transitions to cleaner, nearby energy sources.
Last Price:
Date of Initial Coverage
11-Jul-19
Initial Entry Price
$0.041
Returns from Initial Entry
278%
EXR to achieve a $1BN market cap through successfully advancing one or more of its three projects: its Mongolia gas project, Mongolia green hydrogen project, and/or its Queensland gas project.
Opened: 10-Mar-2022
Shares Held at Open: 3,500,000
Elixir Energy (ASX:EXR) is looking to build out a clean-energy producing hub consisting of Coal Seam Gas and Green Hydrogen in southern Mongolia, bordering China.
Decarbonisation via natural gas energy production and green hydrogen technology. As the world looks to cut greenhouse gas emissions, gas and green hydrogen may prove to be major building blocks towards a net zero economy.
Strategic location in Mongolia
EXR's project is on the border of the clean-energy hungry China, seeking transitions to cleaner, nearby energy sources.
Strong board & management team
A history of success in coal seam gas.
Green-Hydrogen potential
A research report indicated a strong base for a potential Green-Hydrogen project over EXR’s Nomgon PSC.
Fully funded exploration
Drilling planned across giant landholding seeking to open up new sub-basins and add to existing prospective gas resource.
Strong balance sheet
EXR’s $28.4M in cash (at 31/12/2021) can fund its existing business lines for the indefinite future, plus allows for potential acquisitions.
Objective #1: Pilot production program at the gas project
Design, costings, and permitting leading to a maiden pilot production program this year.
Objective #2: Exploration drilling
In addition to the pilot production program, Elixir will continue its exploration program across the Nomgon PSC, with ~20 wells planned for 2022.
Objective #3: Evaluate the Commercial Viability of a Hydrogen Project
Production risk
EXR is drilling for “Coal Seam Gas”. There is a risk that while there are gas shows, they may not be commercially extractable. CSG gas is more complex in nature as compared to conventional gas deposits.
Commercial risk
Green hydrogen project economics depend on governments putting in place mechanisms to support net zero goals.
Geographic risk
There is country-risk. Any political instability might put the production sharing contract at risk.
We have been holding EXR since 2019, while we free carried and took profit during 2020 and 2021, we recently added to our position on market at 16.5c.
Our plan with EXR is to hold to see the company achieve our 2022 objectives, but will look to de-risk our position by selling 20% if the share price significantly re-rates on achieving our 2022 objectives OR based on the strong macro theme of global gas shortages and green energy.
Disclosure: The authors of this article and owners of Next Investors, S3 Consortium Pty Ltd, and associated entities, own 3,500,000 EXR shares at the time of publication. S3 Consortium Pty Ltd has been engaged by EXR to share our commentary and opinion on the progress of our investment in EXR over time.
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Dec 22, 2022
Announcement
Investment Memo:
EXR IM-2022
This morning our 2019 Energy Pick of the Year, Elixir Energy (ASX:EXR), provided an on progress made this year across its portfolio of energy projects.
Let’s take a look...
EXR discovered multiple new sub-basins, drilling ~17 exploration and appraisal wells in 2022.
More importantly, EXR recently announced that gas had flowed in sufficient quantities to ignite a flare from a two-hole pilot production test program – a first for Mongolia’s petroleum industry. This is a demonstration of a repeatable process for EXR of exploration to appraisal to pilot production.
This was EXR’s third year drilling its CBM gas project in Mongolia, and although the project appeared to be ‘running in background’ at times for EXR, there was very strong progress made in particular with securing a gas flow from the production testing wells.
This was the number 1 objective that we wanted to see EXR achieve this year, and we feel that the company accomplished this and even exceeded expectations with a gas flow result.
What’s next for the Mongolian gas project?
The ultimate aim for the production testing program is to produce a commercial flow-rate from the pilot production program early in 2023 before a reserves number can be booked for the project.
Alongside the pilot production, EXR drilled 11,576m in 2022 across the project area. Analysis and interpretation of this program is underway and will supplement the emerging results of the pilot program as the key inputs for EXRs Mongolian CBM plans in 2023.
Back in June EXR signed a Memorandum of Understanding (MOU) with SB Energy Corp (a wholly owned subsidiary of Japan’s second largest company, SoftBank Group Corp) to develop a hydrogen project in Mongolia.
This came as a big surprise to us, and with the support of a major investor like SoftBank, we think this project could gain traction, particularly given the vast wind and solar assets of the project’s location in the Gobi desert.
According to the MOU, both SB Energy Corp and EXR are progressing different parts of the Pre-Feasibility (PFS) work required for a pilot green hydrogen project including:
What’s next for the green hydrogen project?
In 2023 we expect EXR together with SB Energy Corp to focus on getting all of the data required to complete the PFS.
We think that this could be the ‘dark horse’ project for EXR going into 2023. Particularly if hydrogen continues to be prioritised by governments and corporations looking to transition to renewable energy.
In response to the upheaval of global energy markets, in August EXR acquired a gas project in Queensland’s Taroom Trough and just south of Australia’s premier gas hub, and EXR has since done technical work that resulted in the booking of an independently certified contingent gas resource of 395 billion cubic feet (BCF).
Click here if you want to read our deep dive into this project: EXR to drill for gas in Queensland - Next Door to Shell and Santos
What’s next for the QLD gas project?
EXR is planning a drilling program in late 2023 aiming to increase contingent resources and produce a commercially viable flow rate.
EXR had ~$19M in cash in the bank (as at 30 September 2022), meaning it can work on progressing its projects without having to worry about the need to raise capital in the short-medium term.
We are looking forward to updates across EXR’s projects in the new year.
Dec 20, 2022
Announcement
Investment Memo:
EXR IM-2022
Objective
1
:
Pilot production program at the gas project
Objective
2
:
Exploration drilling
Our energy Investment Elixir Energy (ASX: EXR) today announced promising early flow rates from its pilot production test at its coalbed methane project in Mongolia.
Testing at EXR’s Nomgon pilot production plant is ongoing with production from the pilot to continue into the New Year.
EXR say that its plan to determine if a commercial flow rate can be established is on track.
The well is seeing growing water and gas rates. We’re pleased to see that the produced water rates (which were low in the first place due to the high gas saturated nature of the coals) are decreasing while the casing (gas) pressure is steadily increasing.
EXR expects gas flow-rates to have stabilised early in 2023.
We also like to see that the gas samples from the flow tests have measured 99% methane content and the salt content of produced water is now fresher than previously measured. Both of these factors support materially lower costs and environmental impacts in the development stage.
2022 exploration and appraisal drilling program complete
In the announcement today EXR also reported that its 2022 exploration and appraisal drilling program is now complete.
A total of 17 wells were drilled in the year (excluding the Nomgon-8 and 9 pilot wells).
In total, Elixir drilled 11,576 metres in 2022 at its Nomgon IX project, having recently mobilised a new drilling company that applied new drilling systems that allow for wells to be drilled more quickly and with greater confidence.
Analysis and interpretation of this program is underway and will supplement the emerging results of the pilot program as the key inputs for the company’s Mongolian CBM plans in 2023.
The pilot production testing and completion of the 2022 exploration program were the key objectives that we wanted to see EXR achieve this year at its Mongolian gas project:
Nov 18, 2022
Announcement
Investment Memo:
EXR IM-2022
Objective
1
:
Pilot production program at the gas project
Our energy Investment Elixir Energy (ASX:EXR) today announced that pumping has commenced at the Nomgon pilot project with gas breakthroughs that is already being flared — a first for Mongolia.
We consider this a big achievement as getting the maiden pilot production program up and running this year was a key objective that we wanted to see EXR achieve, as we explained in our 2022 EXR Investment Memo.
Having completed the Nomgon-8 and Nomgon-9 pilot wells last month, the pumping related down-hole and surface facilities were installed before commencing the pumping of fluid from these two wells earlier this week.
The early breakthrough of gas supports EXR’s interpretation that the coal is close to 100% gas saturated.
EXR’s aim for the project in the months to come is to establish a commercial flow rate, and when the gas rates stabilises over the coming days, the measurement of the rate can begin.
Meanwhile, appraisal drilling with the Big Slope-3 and Big Slope-4 wells is ongoing. To date, the wells have intersected 21.4 and 38 metres of gassy coal, respectively, and are expected to reach their target depths within the next week or so.
Gas contents measured from these wells have followed up successfully on the high figures measured in Big Slope-2 with Big Slope-3, the highest so far within the Nomgon IX PSC (a peak of 9.2m3/t raw gas basis).
EXR today also released a new presentation for its 2022 AGM and its AGM Chairman's address.
Sep 29, 2022
Announcement
Investment Memo:
EXR IM-2022
Objective
1
:
Pilot production program at the gas project
Yesterday morning our 2019 Energy Pick Of The Year Elixir Energy (ASX: EXR) put out an update on its pilot production program at its Mongolian coalbed methane (CBM) gas project.
EXR confirmed the following:
The first production well intercepted ~55 metres of coal inside the primary target zone that EXR drilled into.
That same rig will now drill the second well and EXR expects to have both wells operational and pumping fluids in around a month.
This comes as welcome news to us as the maiden pilot production program was a key objective that we wanted to see EXR achieve this year, as per our Investment Memo.
The pilot production test is expected to run for up to six months after commencement and is ultimately aiming to provide a proof of concept for the commercial development of EXR’s project.
To see more on the project, check out EXR’s latest investor presentation by clicking on the image below.
Sep 12, 2022
Announcement
Investment Memo:
EXR IM-2022
Objective
1
:
Pilot production program at the gas project
Objective
2
:
Exploration drilling
Following COVID-related and other logistical delays Elixir Energy (ASX:EXR) has commenced operations on its Nomgon pilot production program, spudding its first coalbed methane (CBM) gas well, the Nomgon-8 well, on Saturday.
The two well (Nomgon-8 and Nomgon-9) drilling program is expected to take less than 30 days, with pilot production testing operations to begin within weeks of the wells being completed.
The two pilot wells will be drilled by Major Drilling and will each reach a total depth of ~600m with well planning and casing sizes similar to that of most Australian CBM wells.
This is the first such test in the sub-basin so the timetable is uncertain. But as is the norm with CBM wells, water will initially be produced until the reservoir pressure is lowered and gas can be desorbed and flow. The gas will be flared during the production test.
This comes as welcome news to us as the maiden pilot production project was a key objective that we wanted to see EXR achieve this year, as per our Investment Memo.
Exploration continues
Alongside its production testing in the Nomgon sub-basin, EXR’s exploration program across its giant landholding in Mongolia continues, now utilising three local drilling rigs.
EXR publicly tendered for an additional and more technically advanced drilling rig to join the exploration campaign to improve drilling performance. That tender has now been awarded to Major Drilling, who will introduce a larger mineral-style rig at a cost effective price. EXR expects drilling using this new rig to commence within the next few weeks.
EXR also reports that since its last CBM operations update in July, it has drilled the Bulag Suuj-2, Yangir-5, Orio-1 and Big Slope-1 wells.
Aug 24, 2022
Announcement
Investment Memo:
EXR IM-2022
Objective
3
:
Evaluate the Commercial Viability of a Hydrogen Project
This morning our 2019 energy Pick Of The Year, Elixir Energy (ASX: EXR) put out an update on its MOU with a subsidiary of Japanese Conglomerate Softbank - SB Energy Corp (SBE).
Below are some of the key takeaways from the update:
We especially like that the update shows both partners are working towards the same goal. Whilst EXR is busy on the ground gathering data, SBE is busy progressing the project at the corporate level.
We are particularly interested in whatever comes from the investigations into potential financial support from the Japanese Government, especially after doing a deep dive on the idea of an Asian super grid (see our Quick Take here).
Aug 24, 2022
Investment Memo:
EXR IM-2022
Investment Thesis
1
:
Strategic location in Mongolia
Investment Thesis
3
:
Green-Hydrogen potential
This morning we noticed the following video from Bloomberg, which discusses the idea of continental supergrid's to solve future energy crises.
Of particular interest was the commentary in the video around the potential development of a super grid that ties together countries in Asia and how the Gobi desert in Mongolia fits into all of this.
The video provides context for our 2019 energy Pick Of The Year Elixir Energy's (ASX: EXR) regional ambitions.
EXR holds ground in the Gobi desert in Mongolia, where it is preparing to run a long-term production test across its coal bed methane gas project.
Alongside this, the company is also looking to develop wind & solar projects to ultimately power a green hydrogen project.
Ultimately, EXR is looking to develop an energy hub in a strategically important location from both a natural resource perspective and geographic perspective (bordering energy hungry China).
Watch from 10:54 onwards. Alternatively, here are our key takeaways:
Aug 24, 2022
Announcement
Investment Memo:
EXR IM-2022
Objective
3
:
Evaluate the Commercial Viability of a Hydrogen Project
This morning our 2019 energy Pick Of The Year, Elixir Energy (ASX: EXR) put out an update on its Gobi green hydrogen project.
Specifically, the update covered the renewable energy and water components required to produce green hydrogen.
Key takeaways for the wind resource data:
Key takeaways for the water resource:
To summarise, the data gathered so far looks good enough to take the proposed pilot project into a pre-feasibility study (PFS).
Next, we want to see EXR continue to gather data so that it can clear up the forward plan for what we can expect its green hydrogen project to look like and some clarity on project economics.
Jul 29, 2022
Announcement
Investment Memo:
EXR IM-2022
Objective
1
:
Pilot production program at the gas project
This morning, our 2019 Energy Pick of the Year Elixir Energy (ASX: EXR) put out an update on its upcoming pilot production program for its coal bed methane (CBM) gas project in Mongolia.
EXR report that all of the equipment required for drilling, completion and testing of the two production wells is now in Mongolia, and the extended pilot production program is on track to start towards the end of August.
EXR has engaged the same group of drilling contractors who worked for Rio Tinto on its Oyu Tolgoi mine, located with EXR’s landholding in Mongolia, which we hope will translate into an efficient work program.
EXR expects completing and producing these wells “within weeks of drilling being completed”, with the commercial viability of the wells to be assessed over months by measuring gas flow rates.
This should mean that by early 2023 we will know whether EXR’s wells can commercially produce gas.
The pilot production program is key objective #1 in our 2022 EXR Investment Memo, so today’s news shows that the company is making progress towards starting and completing something we have been patiently waiting for.
To see all the other key objectives we set that we wanted EXR to achieve this year, check out our 2022 EXR Investment Memo here.
Jul 29, 2022
Announcement
Investment Memo:
EXR IM-2022
Objective
2
:
Exploration drilling
This morning, we also got an exploration update from our 2019 Energy Pick of the Year, Elixir Energy (ASX: EXR).
The highlight of today’s announcement was that EXR discovered yet another coal bearing sub-basin at its “Venetian-1” exploration well.
The positive for us here is that EXR continues to discover new sub-basins at parts of its project where we have set no expectations. We see these sub-basin discoveries as almost like free options at growing the size of EXR’s project and make for unexpected positive newsflow.
A bit of a dampener on the positive update today was the mechanical issues EXR is having with its drill rigs, which is, in turn, slowing down the progress of the 2022 exploration program.
Jul 07, 2022
Macro: Natural Gas
Overnight, EU lawmakers voted in favour of labelling gas and nuclear power as “green” as part of the continent’s plan to transition away from fossil fuels.
We’ve long been of the view that gas is the natural transitional fuel that can bridge the gap between fossil fuels and cleaner energy sources.
Burning gas to produce power has a far lower carbon footprint compared to coal and oil, with the added benefit of having all of the infrastructure in place to produce and consume it.
We think that the world is ready to embrace it as part of the energy mix for the next decade and potentially beyond that. As a result, we hold several Investments in companies looking to supply gas to energy hungry parts of the world.
The following Reuters article provides an overview of the proposed EU legislation:
Read the full article here.
Our key takeaways:
To see the Investment Memos for these companies click on the links below:
Elixir Energy (ASX: EXR)
Invictus Energy (ASX: IVZ)
Top End Energy (ASX: TEE)
Jul 06, 2022
Macro: Hydrogen
The following Bloomberg article looks at a Bill Gates backed investment in the hydrogen mobility space.
Read the full article here.
Below are our key takeaways from the article:
In summary, the article speaks to the volume of capital pouring into the downstream technologies that are required to build up a sound and efficient hydrogen supply chain.
For hydrogen to become a part of the energy mix the infrastructure required to produce, transport and then consume it all needs to be developed to the standards of current energy technologies.
With institutional capital and big names like Bill Gates now making investments into the hydrogen space we think it is a matter of WHEN not IF for the hydrogen sector.
Historically, our best performing Investments have come from industries where we have Invested well ahead of institutional capital arriving on the scene. Our Investments in the green hydrogen space are no different.
The following companies held in our Portfolio provide exposure to an industry that we think is on the cusp of exponential growth:
Province Resources (ASX: PRL)
Elixir Energy (ASX: EXR)
Minbos Resources (ASX: MNB)
Jul 06, 2022
Macro: Natural Gas
The following Bloomberg article shines a spotlight on the ripple effects high gas prices have on the global economy.
Read the full article here.
Our key takeaways:
The Bloomberg article focuses on the repercussions gas shortages are having on the EU and the German economy in particular.
The German economy is one of the key pillars of the EU region, with a strong manufacturing industry making it an exporting powerhouse. The country is therefore heavily reliant on reliable energy supplies to keep this part of its economy functioning.
The fear that the Bloomberg article highlights is how a shortage in gas supplies or heightened prices could force shutdowns and lead to a recession.
We think this applies not only to the German economy and the EU but to the rest of the world also. With gas likely to become a more important part of the energy mix as the world transitions away from coal and oil we think investment into new supply will need to accelerate.
As a result we hold the following companies as Investment exposures to natural gas. To see the Investment Memos for these companies click on the links below:
Elixir Energy (ASX: EXR)
Invictus Energy (ASX: IVZ)
Top End Energy (ASX: TEE)
Jul 04, 2022
Macro: Hydrogen
Investment Memo: PRL 2022, EXR 2022, MNB 2022
General: Macro
The following LinkedIn post from Bill Gates shines the spotlight on green hydrogen as a technology solution for a transition towards cleaner fuel sources.
Read the LinkedIn post here.
When major investors start to talk up a particular technology it is generally a leading indicator for massive institutional capital flows into the sector. And Gates is not just a commentator, but an investor in renewable energy and the transition towards lower emission fuel sources.
(Here is an article on one of Gates’ latest ventures in the space: Bill Gates-Led Fund Backs Startup With Cheaper Way to Move Hydrogen)
For a long time institutional investors have avoided making large scale investments into the green hydrogen space, but that now looks to be changing extremely rapidly.
Historically, our best performing Investments have come from industries where we have Invested well ahead of institutional capital arriving on the scene.
Our Investments in the green hydrogen space are no different. We tend to agree with Bill Gates, that green hydrogen has a place in the transition towards clean energy technologies.
The following companies held in our Portfolio provide exposure to an industry that we think is on the cusp of exponential growth:
Province Resources (ASX: PRL)
Elixir Energy (ASX: EXR)
Minbos Resources (ASX: MNB)
Jun 22, 2022
Announcement
Investment Memo: EXR 2022
Key Objective #1: Pilot production program at the gas project
In today’s operations update our 2019 Energy Pick of the Year Elixir Energy (ASX:EXR) also detailed what stage the extended pilot production program was at.
EXR confirmed that it has appointed experienced Mongolian contractor “Monbag LLC” to complete the civil construction works and mentioned that these works were expected to “commence shortly”.
The drilling of the first production well (of two) is expected to spud around the end of August 2022 in line with the timeframe expectations set by EXR at the start of the year.
From there, the production testing will take around 6 months, and we’ll have a better idea of the commercial flow rates of EXR’s gas project.
Jun 22, 2022
Announcement
Investment Memo: EXR 2022
Key Objective #2: Exploration drilling program
Our 2019 Energy Pick of the Year Elixir Energy (ASX:EXR) just put out an operational update with respect to the exploration works happening across its coal bed methane (CBM) gas project in Mongolia.
In the update EXR confirmed the discovery of an entirely NEW coal bearing sub-basin with an intercept returning ~21m of coals.
Importantly the intercept now opens up an entirely new sub-basin inside EXR’s project area which could be prospective for coal bed methane (CBM) gas and more significantly is a sign of how much exploration potential EXR’s project still has.
EXR also confirmed that it plans to follow up this discovery with an appraisal well at a location ~four kilometres away.
Jun 15, 2022
Announcement
Investment Memo: EXR 2022
General: Investor presentation
Yesterday our 2019 Energy Pick of the Year Elixir Energy (ASX:EXR) put out an updated slide deck which it presented at the Queensland Petroleum and Exploration association (QUPEX) conference.
The presentation lays out in detail EXR’s forward plan and where the company is at with both its coal bed methane (CBM) gas and green hydrogen project in Mongolia at a time where energy security has become a major talking point in financial markets.
With the long awaited long term pilot production program at its CBM gas project due to start soon and the optionality from the company’s hydrogen project we think there will be a lot more news flow coming from EXR and expect to see the market take an interest in the company later this year.
To read the presentation in full, click on the image below.
May 06, 2022
Announcement
Elixir Energy Ltd (ASX:EXR) has provided an update on the coal bed methane (CBM) exploration/appraisal program underway across its 100% owned Nomgon IX Coal CBM Production Sharing Contract (PSC).
With the arrival of the Mongolian spring season, EXR has been able to accelerate its multiple well program for 2022 and now has two rigs operating.
EXR reported that it recently finished drilling the Tim-2 appraisal well – a follow on from the successful Tim-1S exploration well drilled earlier this year that opened up a new sub-basin for EXR.
Tim-2 was drilled to a total depth of 1,020 metres – the deepest well EXR has drilled in Mongolia to date — logging 3 metres of coal and 5 metres of silty coal. There was a decrease in coal thickness from the initial Tim-1 well to this Tim-2 well, attributed to localised faulting.
EXR will now integrate the Tim-2 results with geological mapping, age dating, and potentially new seismic to better define this coal bearing sub-basin.
The location of Tim-2 (right on the Tavan Tolgoi border) can be seen on the map below, as can the recently spudded Yangir-4 appraisal well, and the Bulag Suuj-1S exploration well that is due to be spudded imminently.
The Top Diamond Drilling LLC rig, which drilled Tim-2, has now mobilised to a new potential sub-basin in the west of the PSC. Here it is due to spud the Bulag Suuj -1 well later this week.
The Yangir-4 appraisal well, in the previously identified coal bearing Yangir sub-basin, can also be seen within EXR’s giant landholding. Yangir-4 was recently spudded by EXR’s newly hired drilling contractor, Ellecohr LLC.
These wells are part of the ~20 wells that we said that we wanted to see EXR drill throughout 2022, a key objective in our EXR Investment Memo.
EXR also notes that the extended pilot production testing that’s planned for mid-year continues to progress. This initial pilot program, the first in the country, is on track to meet its mid-year target. A commercial flow rate would be a significant event for EXR and its shareholders and given the relatively low costs involved in Mongolian, that hurdle shouldn’t be too high.
EXR explained that the tendering process for the program's civil works is well advanced, and a contractor is expected to be hired shortly.
This is promising news as pilot production program was the #1 key objective that we wanted to see EXR achieve this year at the Nomgon PSC, as per our EXR Investment Memo.
EXR also reported that its 2022 2D seismic acquisition program is proceeding as planned, with 223 kilometres (out of a total of 322 kilometres) acquired to date.
Mar 31, 2022
Announcement
This morning EXR confirmed that it has discovered a new coal bearing sub-basin.
The company has completed the first well for the 2022 exploration program, reaching a total depth of 804m and logging ~46 metres of coals and leading to another sub-basin being confirmed as coal-bearing to the south of its project area.
Today’s news now confirms that EXR has already started working towards completing its 2022 exploration program, which we set as objective #2 in our 2022 Investment Memo, and that the all-important long term pilot production program is being procured, which we set as objective #1.
EXR has already started drilling a second well ~200m downdip of this well and will be testing for extensions to the coal bearing formations.
Drilling contracting had been completed for the remainder of the 2022 exploration program, whilst works have begun on the 2022 2D seismic acquisition program with the first 47km completed from a targeted ~322km.
EXR also confirmed that it has commenced discussions with drilling contractors to finalise the terms and conditions for the drilling/long term pilot production program scheduled for ~mid year.
What’s next: We want to see EXR continue its exploration efforts and lock in a drilling contractor to drill and complete the long term pilot production wells or progress on its green energy project.
Mar 25, 2022
Announcement
We caught up with Neil Young, the head of our energy investment Elixir Energy (EXR), following his presentation on Wednesday at the Brisbane Mining and Energy Conference.
EXR is our 2019 Energy Pick of the Year, and has been making steady progress with its flagship Nomgon coal bed methane project in Mongolia, near the Chinese border.
This year, our #1 objective for EXR to achieve is to deliver its maiden pilot production program at Nomgon.
Neil provided an update, expanding the program to a planned ~24 wells, which should both grow and de-risk the gas resources in place.
We’re also pleased to see progress with EXR’s Hydrogen project.
Given the EXR’s team’s track record (Chairman Richard Cottee built QGC from a CSG junior capped at $20M to $5.7B takeover acquisition, Neil was formerly an executive within Santos’ coal seam gas division), as well as first mover advantage within an energy hungry region, we continue to have confidence in EXR’s capability to execute on its vision.
We found the EXR video on its H2 project useful to understand the importance of EXR's strategic location:
Feb 28, 2022
Today EXR announced that it had started drilling the first of a total 24 well drilling program planned for 2022.
The first of these wells sits right on the border of the tenements that make up the Oyu Tolgoi mine owned by Rio Tinto and will be drilled to a planned total depth of ~700m.
This year, we want to see EXR complete the pilot production program off the back of last year's drilling program.
EXR confirmed that the 2 well extended pilot production program was scheduled to commence around ~mid year. With gas becoming a talking point off the back of the Russia/Ukraine conflict we are eagerly waiting to see if EXR can confirm economic flow rates at its project.
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