Genie Energy Ltd. (NYSE:GNE, GNEPRA) says that its subsidiary, Genie Oil Shale Mongolia LLC (GOSM), has signed a prospecting agreement with the Petroleum Authority of Mongolia (PAM). The new exploration block covers 25,000 square kilometers in Central Mongolia southeast of the Mongolian capital, Ulaanbaatar.
The agreement, the first to be signed under recently passed legislation, also provides a framework under which the company can request a commercial production agreement once a specific suitable resource and location are identified.
Together with its previously signed exploration agreement, GOSM now has exclusive rights to explore for oil shale in approximately 60,000 square kilometers in Mongolia.
In 2013, Genie and the PAM entered into an exclusive, five-year oil shale development agreement to explore and evaluate the commercial potential of oil shale resources on a separate 34,470-square-kilometer area in Central Mongolia. GOSM continues to conduct an exploratory drilling program pursuant to that five-year agreement.