TMK Energy gas rates surge as Mongolian drilling push looms

TMK Energy has delivered a solid four per cent monthly increase in gas production at its wholly-owned Gurvantes XXXV coal seam gas pilot project in Mongolia, with instantaneous flow rates recently spiking to more than 50,000 standard cubic feet per day (scfd).

The company says average daily gas production for August hit 810 cubic metres per day, or around 28,600scfd, up from July’s average of 778 cubic metres per day. The result comes as TMK prepares to kick off a new drilling and well workover program after signing a contract with Major Drilling.

The progress at Gurvantes XXXV is timely and feeds into a broader national energy strategy. Mongolia’s coal-bed methane sector, while still in its early days, is already being viewed as a domestic power supply solution rather than just an exploration story, with the government in Ulaanbaatar pushing ahead on new gas-fired power generation to ease its current grid constraints.

Those constraints stem from ageing Soviet-era coal-fired plants operating with zero reserve capacity, causing severe winter supply deficits and frequent blackouts. Outdated transmission networks waste roughly 25 per cent of generated electricity, forcing the country to import over 20 per cent of its power from Russia and China at high cost.

Furthermore, the rigid coal fleet cannot rapidly ramp up output to balance peak-demand periods or integrate intermittent renewables. Developing domestic coal-bed methane (CBM) fast-start gas plants would provide critical peak-load balancing, stabilise the grid, and directly reduce reliance on expensive imports.

TMK is looking to get a piece of that action, fast-tracking a gas-to-power project (GPP) with its local GPP partner Dashvaanjil Group to generate electricity from its produced gas. The company says the front-end engineering and design (FEED) phase is now complete, with implementation planned for later this year.

TMK Energy chief executive officer Dougal Ferguson said: “The Pilot Well Project (PWP) delivered another solid month’s performance during August with gas production again ticking up from the prior month and approaching the all-time record average monthly gas production achieved back in March 2026, when the gas rate first spiked for an extended period.”

The upcoming 2026 work program is designed to deliver a near-term boost to gas production. It includes the drilling of a new well, LF-08, and a re-completion program across three existing wells, which is expected to improve their output. One of those three wells to be worked over, LF-03, has been out of service for several months while waiting for a pump replacement.

Management says bringing LF-03 back online, combined with the new drill hole and reworking the other two holes, is expected to further improve gas production, boost commerciality and ultimately facilitate the booking of the company’s maiden gas reserves.

The bigger prize for TMK lies in the sheer scale of its ground in Mongolia’s South Gobi desert.