Interesting points from quarterly 1. If, but, maybe, would be,...

Interesting points from quarterly

1. If, but, maybe, would be, could be

GOH and Elixir have been closely working together since the announcement to ASX of the Acquisition and have been receiving regular guidance on the expected timing of the award of the PSC from both MRPAM and GOH’s in country advisors. Although there is no guarantee of when or if the PSC will be awarded in the expected timeframe,

2. Not long to wait

the approval process is nearing its end point under the Petroleum Law of Mongolia, which is formal Cabinet approval to establish the PSC.  Elixir and GOH management were recently in Ulaanbaatar, where they were advised at a Government meeting that a formal resolution to award the PSC is expected to be put to Cabinet for its approval in late March or early April of 2018.  The Acquisition remains subject to a number of conditions precedents with the principal condition being the formal award of the PSC to GOH.

3. It is worth waiting for

The PSC, (named Project Khiimori) is located in what is considered to be one of the most prospective basins in Mongolia for CBM.  The PSC surrounds one of the world’s largest producing thermal coal deposits, Tavan Tolgoi, which has an estimated resource of over 6 billion tonnes and produced over 14 million tonnes of coal in 2016.  Data from wells within the Tavan Tolgoi mine indicate gas contents of up to 15m3/tonne (480 cf/ton) at depths of 467 metres below surface which is considered high by world CBM standards and is a good indication that surrounding areas are likely to contain similar gas content levels.

4. There is demand

The Project Khiimori CBM PSC will be the first unconventional PSC issued pursuant to the country’s updated Petroleum Law, which was passed by Cabinet in 2014.  Project Khiimori, which covers an area of over 7 million acres, lies adjacent to the Chinese border and is ideally placed for future gas sales into the extensive Northern China gas transmission and distribution network.  In addition to Chinese gas demand, Mongolia currently has no gas production and there is a strong political desire to replace high emission coal power and heat generation with low emission clean-burning gas fired generation.

5. They have been busy, despite the silence

Elixir has now completed its technical due diligence and has commenced detailed planning activities and studies to complement the work being done by GOH with respect to the planned work programme, including defining the prospective resource that can be assigned to the PSC area.  Upon award of the PSC, Elixir intends to exercise the option and commence on ground activities as soon as feasibly possible.  The current exploration plan includes the acquisition of around 200km of seismic over potentially prospective areas which will provide “ground breaking” new data and assist in potentially defining additional focus areas for future drilling.

6. Future plans

In addition to the seismic, the 2018 exploration plan includes the drilling of up to two wells, where key data will be obtained to confirm gas contents and understand permeability, one of the last remaining key technical elements of the play that needs confirmation.  Drilling costs for the wells are expected to be around US$500,000 each.

7. The key ingredient. Good management.

Upon completion of the Acquisition, Mr Neil Young will join the Board of Elixir as an Executive Director and Chief Executive Officer (“CEO”).  Neil has a business development and commercial background and is the Managing Director of GOH.  He has worked in the energy industry for over 20 years, including being Manager Business Development at Santos where he was a key leader in the Santos team that put together much of the Australian.

8. Cash on hand to pay for drilling

At 31 December 2017, Elixir had cash of $2,786,002 (30 June 2017: $1,893,285) and remains debt free with minimal exploration or expenditure commitments other than those that may arise from acquiring GOH.  They also gave themselves a pay rise.

9. Moselle No further info.

On 26 December 2017, the Company announced that the long-awaited renewal of the Moselle Permit in France had been granted.  The renewal, which was originally supposed to be granted in 2014, is currently due to expire on 20 January 2019, being five years from the original renewal date in 2014.  The Company is currently in the process of applying for a three-year extension to the current (second) term.  At