Genie Energy Ltd. (NYSE:GNE, GNEPRA) said Thursday  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 twenty-five thousand 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.

Michael Jonas, Genie’s Executive Vice President and Director of Global Exploration and Business Development, said, “We thank the Petroleum Authority and the Ministry of Mining for their hard work and professionalism in getting us to this point. We are excited to expand our oil shale exploration program in Mongolia, and expect that our investment will benefit the people of Mongolia as well as our Company.”

Yuval Bartov, Chief Geologist of Genie Oil and Gas, said, “Our analysis of the available geological evidence suggests that this license area may contain world class deposits of thick and rich oil shale well-suited for our in-situ extraction technology.”

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.

“We are pleased that Mongolia and Genie Energy will be working together to establish oil shale reserves and explore for and exploit the resource. The recently passed Petroleum Law created a favorable environment for investment in conventional and unconventional petroleum sectors, increasing competition and encouraging sustainable long term activity,” said D. Gankhuyag, the Mongolian Minister of Mining.

In 2013, Genie and the PAM entered into an exclusive, 5-year oil shale development agreement to explore and evaluate the commercial potential of oil shale resources on a separate 34,470 km2 area in Central Mongolia. GOSM continues to conduct an exploratory drilling program pursuant to that five year agreement.

source: Yahoo! Finance