TMK Energy (ASX:TMK) signs Mongolia gas-to-power agreement with Dashvaanjil

TMK Energy has signed a Memorandum of Understanding with Dashvaanjil Group LLC to implement what the company describes as its first gas-to-power generation project at the Gurvantes XXXV Pilot Well Project in Mongolia.

The agreement contemplates power generation of up to 1MW using gas currently being produced from the Gurvantes XXXV Project, supplemented by Dashvaanjil’s LPG products, providing what TMK describes as a dual fuel solution.

The company said the project is intended to provide an uninterrupted power supply to TMK and a reliable power supply to local energy users.

Highlights

• TMK has signed an MoU with Dashvaanjil Group LLC, Mongolia’s largest LPG import and distribution company
• Initial agreement contemplates power generation of up to 1MW
• Power generation will utilise gas produced from the Gurvantes XXXV Project, supplemented by Dashvaanjil LPG products
• Engineering and design work has already commenced
• Engineering and design is expected to be completed by the end of Q2 2026
• Construction, commissioning and first power generation are targeted for completion by the end of Q3 2026

The agreement outlines a three-stage framework consisting of engineering and design, procurement and construction, and commissioning and power generation.

Engineering and design work has already commenced, with Dashvaanjil undertaking detailed engineering studies for the downstream elements of the project at its own cost, while TMK is undertaking all upstream field work.

TMK said the initial agreement is for up to a 1MW power plant to be placed near the Pilot Well Project and fuelled by gas the company is currently producing, with Dashvaanjil’s LPG imports set to supplement fuel supply until gas production from TMK’s Pilot Well Project is sufficient to fully fuel the 1MW unit.

TMK said the Power Project will be designed to be modular and scalable to allow excess gas to be utilised in the future.

TMK Chief executive officer Dougal Ferguson said the agreement represented another milestone for the company.

“This is another milestone agreement for TMK which cements our relationship with a highly experienced local energy partner and is a major step forward in advancing our pathway for future commercial gas sales.”

TMK said maintaining a long-term reliable power supply is key to allowing the company to continue increasing gas production and expanding operations at the Pilot Well Project.

The company also stated the Power Project is expected to generate more energy than it requires, with excess power able to be sold to local customers, most likely local industrial customers such as local coal mining operations, while TMK also noted the local grid is currently 100% reliant on Chinese electricity imports.

Power is scheduled to be produced and available for consumption by the end of Q3 2026.

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