Name of the Project
Red Lake coal bed methane (CBM) project.

Location
South Gobi region, Mongolia.

Project Owner/s
ASX-listed gas developer Jade Gas Holdings, through its subsidiary Methane Gas Resource, a joint-venture company with the Mongolian government.

Project Description
The project entails the development of coal bed methane resources within the Tavantolgoi XXXIII unconventional gas basin. Full-field planning currently envisages 800 wells across three phases; the proposed contractor consortium has indicated that the field could support up to 1 400 wells, excluding additional opportunities at the Vista and Brownhill reservoirs.

Phase 1 comprises 175 lateral, stimulated wells across the Red Lake Development Area, supported by drill pads, access roads, water storage and drainage systems, gas metering and integration facilities, communications infrastructure, an expanded camp and a battery energy storage system to supply power to drilling and dewatering operations.

Phase 2 proposes the drilling of 265 wells and Phase 3 the drilling of 360 wells, totalling 800 wells.

A scalable, skid-mounted liquefied natural gas (LNG) facility is planned to commercialise gas from the first estimated 40 production wells, with modular additions as production increases.

Potential Job Creation
Development preparations include recruitment of an expanded workforce, while the existing Red Lake camp is planned to be expanded into an estimated 500- to 750-person facility.

Capital Expenditure
Phase 1 investment is estimated at $762.5-million. This includes an estimated $150-million for the scalable LNG facility.

Planned Start/End Date
Subject to definitive agreements, development works are expected to start in late 2026. Initial rig mobilisation and drilling are targeted to start between February and March 2027.

Latest Developments
On July 20, 2026, Jade Gas announced a nonbinding collaboration agreement with PT Beijing Energy Linking. The arrangement provides a framework for the contractor consortium to fund the approved Phase 1 contract costs, with repayment through future gas-sales revenue sharing while Jade Gas retains ownership. 

The agreement follows approval of the project appraisal report in April 2026 and the maiden reserves report in June 2026, representing the first natural gas reserves approved in Mongolia. 

Definitive agreements were targeted for the end of the third quarter of 2026, subject to negotiation, due diligence and approvals.

Key Contracts, Suppliers and Consultants
PT Beijing Energy (proposed lead engineering, procurement, construction and commissioning contractor and Phase 1 funding counterparty); PetroChina (proposed subcontractors).

Contact Details for Project Information
Jade Gas Holdings, email info@jadegas.com.au.