‘Erdenes Methane’, subsidiary company of ‘Erdenes Mongol’ LLC and ‘Jade Methane’ Company of Australia established an investment agreement on exploration of coal seam methane gas in May, 2019. Moreover, the two sides commenced their work by founding a joint company ‘Methane Gas Resources’.

‘Jade methane’ company is fully covering investment for unearthing coal seam gas in Tavantolgoi deposit. Erdenes Methane plans to drill five holes this year while geologists from Australia studied geological formation of the deposit and defined sites for extraction. The joint company has drilled 500-900 meter deep holes in eight sites. A total of 5207.7 m holes have been drilled and full test for methane gas has been made in samples of 618 pieces of coal.

Methane gas is smokeless, odourless and burns 98 percent. Therefore, if it is introduced into use, it is considered to resolve air pollution issue in Ulaanbaatar city aside from ensuring domestic fuel demand at 100 percent. Huge amount of water is collected in the process of unearthing methane gas. The collected water is possible to be supplied to coal preparation plants operating in territory of Umnugobi aimag.

In addition, experts calculated that methane gas demand at international market is expected to be raised by 5.8 percent by 2021 compared with five years ago.