Jade Gas Holdings Ltd. has signed a non-binding letter of intent with Chinese gas equipment manufacturer Zhengzhou Langrun Intelligent Equipment Co. Ltd. to develop a coal-bed methane project in Mongolia.
The agreement between the two companies includes project financing of up to US$46 million over the first stage of Jade’s Red Lake development. Key aspects include drilling and production operations for the 18 wells at the Red Lake gasfield and potential to expand the terms to accommodate all 175 Phase 1 gas production wells.
Jade said it chose to enter into an agreement with Langrun based on their proven operating and financial capabilities and their previous experience with similar scale coal bed methane projects. Langrun’s expertise also allows Jade to seek options to fast-track development of the Red Lake gas field and to optimise gas production.
Jade Executive Director, Joe Burke, said: “Langrun are well known to us, having also worked with our drilling contractor DWK for many years.
“Having a collaboration of this nature with a company with such vast experience in gasfield developments of this stage would be a huge advantage as we focus on the most appropriate pathway to develop the Red Lake gasfield.”
“Considering the high gas potential demonstrated now at Red Lake, our focus remains on moving quickly to gas production and customer markets for early revenue.”
The Red Lake gasfield could potentially be developed to cover purification, pipeline and other transport, compression, liquefaction, refuelling station construction, enabling gas sales for vehicle, industrial and other markets.
Langrun CEO Wang Yongtao said: “We share in Jade’s view that there is a significant opportunity for gas in the southern Mongolian region, and Langrun has the experience and understanding to execute on this vision to take advantage of the gas demand in the region, particularly for LNG and CNG where we have a rich experience.”
Jade could provide the gas source, land for facilities and operational rights, while Langurn will arrange the financing for drilling and other production services and manage production operations.
The initial phase of development will focus on 20 wells, while in the subsequent phase, the partnership may expand to cover additional wells and broader project development.
The initial letter of intent is non-exclusive and does not create any immediate financial obligations on Jade. A binding agreement is subject to commercial flow rates at the first two production wells, and regulator and Mongolian government approval.

Published Date:2025-11-11