Highlights
• Both Red Lake Gas Field wells continue to perform in line with expectations
• Dewatering activities continuing
• Pressure draw down continues to be in line with expectations with gas desorption
anticipated very soon
• First gas production expected in the current Quarter
Jade Gas Holdings Limited (Jade or the Company) is pleased to confirm both Red Lake Gas Field
wells continue to perform in line with expectations with gas production expected very soon.
Operations Summary - Continued Progress Toward First Gas Production
Following commencement of operations on 10 June 2025, stable pumping has been sustained for the coal
bed methane production wells RL-Hz-01 and RL-Hz-02 at the Red Lake gas field. Dewatering operations have
remained steady since the wells came online (see ASX Announcement dated 10 June 2025). The reduction
in reservoir pressure is progressing according to plan and consistent with expectations. The Company
forecasts achieving the critical desorption pressure during the current quarter with gas production expected
soon thereafter.
Commenting on the progress, Jade Non-Executive Director, Dr Ian Wang, said:
“The ongoing operations at both wells are in-line with our expectations. We continue to approach the
projected desorption pressure and we anticipate gas desorption from the wells over the coming weeks.
The observations of well performance are similar to what we have seen in our analogue basin, Qinshui, in
northern China – if we can emulate the rapid development of those fields, we expect to create exceptional
value for our shareholders.”
1. Production Metrics
Water produced from both wells is trucked to the nearby Tavan Tolgoi coal mine (operated by Erdenes Tavan
Tolgoi) for beneficial use in their operations.
2. Reservoir and Technical Progress
• Operating Philosophy: The wells are being operated in line with best-practice operations for lateral
wells in the Qinshui Basin in China, the analogue field for Red Lake. Currently, the fluid level in the
wells is being lowered by approximately 5 metres per day to minimise rapid drawdown on the coal
that can cause premature collapse of the seam and damage the coal. The drawdown rate is being
closely monitored and managed by the onsite production operations team and may be adjusted
depending on the performance.
• Gas Desorption Indicators: The coals in the Red Lake Field are slightly undersaturated and it is
estimated that the flowing bottom hole pressure may reach critical desorption point during the
coming months. The pressure in the casing will increase as gas begins to desorb ahead of establishing
continuous gas flow rate.
3. Well and Drilling Activities
• Existing Wells:
a. RL001-3b-Hz-01 was fully operational during the month of July with 100% uptime
b. RL001-3b-Hz-02 was fully operational during the month of July with 100% uptime
4. Forward Outlook
• Upcoming Activities: The wells are expected to continue to produce water until the critical desorption
pressure is reached, at which time gas is expected to be produced. The production operations team
continue to monitor well performance and adjust the draw down rate in line with best practice and
consistent with the experience of the team in similar well production activities in the Qinshui Basin.
• Additional Seismic: The technical team is assessing the need for additional 2D or 3D sesimic surveys
to be conducted over part of the Red Lake field during 2H 2025.
Approved for release by the Board of Jade Gas Holdings Ltd