TMK Energy Limited (ASX: TMK) Secures MoU for Gas Sales
MoU Execution
TMK Energy Limited (ASX: TMK) has executed a Binding Memorandum of Understanding (MoU) with German firm Jens Energie LLC (JEL) to sell gas produced from its Gurvantes XXXV Coal Seam Gas (CSG) Project’s pilot well complex. This partnership marks a significant step towards utilising Mongolia’s coal seam gas resources for power generation.
Gas Production and Sales Terms
The MoU outlines that JEL will convert initial test gas into electricity, which will be sold to local customers. TMK has committed to supplying JEL up to a maximum of 15,000m³ (approximately 0.6TJ/day) of gas per day, contingent upon delivering a minimum of 5,000m³ (about 0.2TJ/day) by 30 April 2025. The gas sales agreement will have an initial duration of two years, with a potential two-year extension.
CEO Comments
TMK Energy’s CEO, Dougal Ferguson, expressed his satisfaction with the partnership, stating, “It is very pleasing to be able to execute a binding MoU that introduces a German backed power generation partner… We will be working collaboratively with JEL… to allow the first coal seam gas production in Mongolia to be beneficially used for power generation.”
Future Outlook
The MoU is subject to customary conditions, including the successful execution of a detailed Gas Sales Agreement (GSA) and JEL’s compliance with importation and installation requirements for a gas-fired generator at Nariin Sukhait by 30 April 2025. This initiative positions TMK towards generating revenue and offsetting pilot well production costs while contributing to energy independence in Mongolia.
Mr Jens Shulte, Chairman of Jens Energie LLC, shared his enthusiasm for the collaboration, noting, “We are extremely excited to make our first major investment in this quickly emerging Mongolian industry.”
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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