Highlights
• Gas production continues to build in line with expectations
• Average daily gas flow rates significantly increase by 246% month on month
• Once commercial flow rates are reached the Field Development Plan (PDO) and the
Economic Study will be completed
• Flow rates expected to demonstrate a very high margin gas operation
Jade Gas Holdings Limited (Jade or the Company) is pleased to provide the monthly operations
update on production activities at the Red Lake Gas Field in the South Gobi region of Mongolia.
Operations Summary - Gas Production building from both Horizontal Wells
During the month of September, both horizontal wells in the Red Lake field (RL-Hz-01 and RL-Hz-02)
continued to be dewatered with the fluid level gradually being lowered to minimise the flowing bottom hole
pressure in the wells. Gas flow rate has increased throughout the month as a result with daily average gas
flow rates increasing substantially month on month as the wells build to commercial flow rates.
Once commercial flow rates are reached the Economic Study and PDO will be completed and submitted to
the Mongolian regulators for review and approval.
An additional generator and switching equipment have been installed to limit potential downtime
associated with instability in the local power network. Gas fired power generators are to be installed to
provide more stability in operations.
Commenting on the progress this month, Jade Non-Executive Director, Dr Ian Wang, said:
“As we expected, the flow rates are increasing in line with our forecasts based on all the experience of our
teams in the Qinshui Basin in China. We continue to gather the field data which will allow us to finalise
the Economic Studies and then we can move on to executing on the broader field development plan”.
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.
• Gas Desorption Indicators: As the pressure decreases further into the coal seam with on-going
dewatering, the Company expects to see gas rates build further over the coming months.
3. Well and Drilling Activities
• RL001-3b-Hz-01 was fully operational during the month of September with 99.6% uptime
• RL001-3b-Hz-02 was fully operational during the month of September with 99.9% uptime
• Uptime performance improved in September with the installation of a generator at site
4. Forward Outlook
a. Upcoming Activities: The gas flow rates from both wells are expected to continue to increase.
Commercial flow rate will be reached at which time the economic assessment of forecast well
performance can be completed which will inform the finalisation of the full field development (Plan
for Development and Operations).
b. Additional Seismic: The technical team is assessing the need for additional 2D or 3D seismic surveys
to be conducted over part of the Red Lake field during 2H 2025. The mine operator (Erdenes Tavan
Tolgoi JSC) is undertaking a corehole program in the area that will further assist the team in the
understanding of seam correlation, and this may delay the need to acquire additional seismic.
Authorised for release by the Board of Jade Gas Holdings Ltd.