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    Oz Elixir Plans Small Scale LNG Plant in Mongolia


The plant will supply fuel to the South Gobi’s coal trucking fleet.

by: Shardul Sharma

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Oz Elixir Plans Small Scale LNG Plant in Mongolia

Sydney-listed Elixir Energy has executed a non-binding memorandum of understanding with Mongolian fuel retailer MT Group to develop a small-scale LNG plant to supply fuel to the South Gobi’s large coal trucking fleet, it said on June 12 in a statement.

The South Gobi hosts a large trucking fleet that currently burns diesel and which could economically be replaced by cleaner and cheaper gas fuelled vehicles, Elixir said. The Tavan Tolgoi mine, which is located inside Elixir’s Nomgon coalbed methane production sharing contract, trucks around 15mn metric tons/year of coal to China, utilising thousands of trucks.

“Given Elixir’s milestone event of making Mongolia’s first gas discovery earlier this year, the company concluded it is now time to pursue the investigation of this first offtake option,” the company said, adding initial modelling indicates that a small-scale LNG project in this location should be highly profitable.

The Nomgon PSC is located in the Gobi Desert on the Mongolia-China border. The PSC comes with an independently certified risked ‘best case’ prospective resource of 7.6 trillion ft3 and an unrisked ‘best case’ prospective resource of 40 trillion ft3.