TLOU Energy Ltd (LON:TLOU) told investors that the Lesedi 3 production pod has successfully reached critical desorption pressure (CDP) - the point at which gas begins to be released from coal following dewatering.
It noted that Lesedi 3 has reached CDP while Lesedi 4 continues to be carefully dewatered ‘in a consistent and controlled manner’.
"Since the commencement of production testing, the dewatering process at Lesedi 3 and Lesedi 4 has steadily progressed with CDP recently being reached at Lesedi 3.
“The primary objective remains to demonstrate a commercial gas flow rate."
At Lesedi 3 the next phase of working includes a continuation of water pumping to increase gas pressure steadily, ahead of flow testing.
In a note to clients, analysts at ‘house’ broker Shore Capital commented: “Today’s encouraging news follows the announcement last month that Tlou had been selected as a preferred bidder for the development of up to 100MW coalbed methane-fired power generation, and we continue to see further and very exciting potential catalysts on the horizon in the near term, particularly with regard to the announcement of initial production test results from the ‘Lesedi 3’ and ‘Lesedi 4’ wells.”
In midday trading, shares in Tlou Energy were 0.8% higher at 6.40p.
-- Adds analysts comment, share price --