Jade Gas Advances Mongolia Project with Reserve Booking and $1.8m Capital Raise

Appraisal Completion Sets Stage for Mongolia’s First Coal Bed Methane Development

Jade Gas Holdings (ASX:JGH) has hit a critical milestone in its Tavan Tolgoi coal bed methane (CBM) project in Mongolia’s South Gobi region, successfully completing the appraisal phase that included drilling the country’s first horizontal gas production wells. Both wells at the Red Lake gasfield continue to produce gas and water in line with expectations, underpinning the project’s technical viability and commercial potential.

The company is poised to lodge its maiden gas reserve booking with the Mongolian Minerals Reserve Council (MRC) imminently, marking a regulatory landmark that formally recognises the project’s reserves and unlocks the pathway to development. This reserve booking covers a modest 4.2km2 portion of the project area and production from one coal seam, a procedural step in Mongolia’s mineral reporting standards and a foundation for the next phase of approvals.

Development Blueprint and Regulatory Pathway

Following MRC validation, Jade plans to submit its Plan for Development of Operations (PDO), which lays out the technical scope, infrastructure design, production forecasts, and environmental commitments for the project. The first phase envisions a drilling campaign of up to 175 wells focused on supplying liquified natural gas (LNG) to the local transport network and mining power needs. The full field development contemplates approximately 800 wells over a 30-plus year lifespan, signalling a long-term commitment to Mongolia’s energy landscape.

PDO approval is a crucial de-risking event, confirming economic viability and regulatory compliance in Mongolia, and smoothing the way for the exploitation licence application that will enable commercial gas production. Jade is concurrently advancing environmental and social impact assessments to meet Mongolian regulatory requirements, ensuring the project aligns with national standards and international best practices.

Capital Raising and Financial Position

To support this transition from appraisal to development, Jade successfully raised A$1.8 million in March through a placement priced at A$0.03 per share, including attaching options. This capital injection, which represented a 10.5% premium to the 15-day VWAP, strengthens the company’s financial footing alongside existing convertible note facilities and director loans, bringing total available funding to approximately A$4.5 million at quarter-end.

Despite ongoing expenditure on exploration and evaluation (A$457,000 this quarter), Jade reported cash at bank of A$597,000, supplemented by unused financing facilities. Related party payments of A$184,000 reflect director fees and salaries. The company’s funding runway, based on current burn rates, stands at around 3.6 quarters, highlighting the importance of progressing commercial discussions and regulatory milestones efficiently.

Operational Performance and Commercial Engagement

Operationally, the two horizontal wells drilled at Red Lake have delivered steady gas production, with January 2026 volumes up 22% from December and average daily production increasing by 21%. The company plans to transition site power from diesel to gas in the first half of 2026, further aligning operations with clean energy objectives.

Jade continues to engage with domestic and international partners, energy buyers, and infrastructure providers to shape the commercial framework for the TTCBM Project. These discussions aim to underpin a scalable gas operation that supports Mongolia’s energy independence and decarbonisation goals by reducing reliance on imported fuels and improving air quality.

Jade’s strategic position builds on prior momentum, including the recent A$1.8M capital raise and regulatory progress with the Mongolian Minerals Reserve Council. However, the company faces a leadership transition following the recent CEO resignation announcement, adding a layer of uncertainty as it advances these critical next steps.