TMK Energy has secured a drilling contract for its LF-07 production well, marking a key milestone in its Lucky Fox Pilot Well Project in Mongolia. The company also outlines an ambitious 2025 exploration program aimed at expanding its coal seam gas resources.
- Drilling contract signed with Major Drilling Group for LF-07 well
- Deployment of advanced TXD200 drilling rig for the first time
- LF-07 expected to spud in late July after Mongolia’s Naadam festival
- LF-07 to be the last pilot production well in current Lucky Fox phase
- Plans for up to five exploration wells in 2025 to grow contingent resources
Contract Signing and Drilling Plans
TMK Energy Limited (ASX:TMK) has formalised a drilling contract with Canadian-listed Major Drilling Group to undertake the drilling and completion of the LF-07 production well at its Lucky Fox Pilot Well Project in Mongolia. This agreement continues a successful partnership, with Major Drilling having previously completed six pilot wells for TMK’s Gurvantes XXXV Coal Seam Gas Project.
The LF-07 well is strategically positioned up dip from existing wells, aiming to optimise early gas production and data collection. The drilling is scheduled to commence in the second half of July 2025, following the Naadam festival, Mongolia’s principal annual holiday.
Technological Upgrade and Operational Efficiency
For the first time, TMK will deploy the TXD200 drilling rig, a larger and more powerful unit equipped with an advanced mud system. This upgrade is expected to enhance drilling efficiency and safety, reflecting TMK’s commitment to utilising cutting-edge technology in its operations.
Chief Executive Officer Dougal Ferguson highlighted the value of the ongoing collaboration with Major Drilling, praising their safety record and cost-effective execution. The LF-07 well will mark a significant milestone as the final pilot production well in the current phase of the Lucky Fox project.
2025 Exploration Program and Resource Expansion
Following the completion of LF-07, TMK plans to initiate a relatively low-cost but potentially high-impact exploration drilling program. This will involve up to five exploration wells in a highly prospective area approximately 60 kilometres east of Nariin Sukhait. The objective is to add to the company’s already substantial 2C contingent coal seam gas resources in the region.
The existing pilot wells have demonstrated success in reducing reservoir pressure over the past two years, with recent pressure build-up tests confirming positive results. The new well will help determine if similar pressure trends are evident at LF-07’s location, providing critical data to support commercial gas flow viability from the upper coal seam.
Strategic Implications
TMK’s methodical approach; progressing from pilot production wells to a broader exploration program; signals a clear pathway toward commercialising its coal seam gas assets. The integration of advanced drilling technology and the continuation of a trusted drilling partnership underpin the company’s operational confidence as it moves closer to proving commercial gas flows.
Bottom Line?
TMK’s LF-07 drilling and upcoming exploration program set the stage for critical resource validation and potential commercial breakthrough.
Questions in the middle?
- What are the detailed financial terms and capital requirements of the LF-07 drilling contract?
- How will the results from LF-07 influence TMK’s production forecasts and development timeline?
- What are the prospects and timelines for converting contingent resources from the 2025 exploration wells into reserves?