Jade Gas Holdings (ASX:JGH) said drilling started on the second lateral gas production well at the Red Lake gas field in Mongolia, according to a Wednesday Australian bourse filing.
The well will be drilled to a target measured depth of around 1,600 meters.
This follows the completion of the first horizontal production well at Red Lake, which intersected almost 700 meters of gas-bearing coal, with nearly 99% net coal.
After the installation of the liner and production casing, both wells are expected to be completed with downhole pumps and begin dewatering in late April, the filing said.
The company's shares fell about 3% in recent trading on Wednesday.
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