Petro Matad Limited Operational Update (4310C)

TIDMMATD

RNS Number : 4310C

Petro Matad Limited

01 October 2018

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY PETRO MATAD LIMITED TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION (EU) NO. 596/2014 ("MAR"). ON THE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE ("RIS"), THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

1 October 2018

Petro Matad Limited

("Petro Matad" or the "Company")

Operational update

Petro Matad, the AIM quoted Mongolian oil explorer, is pleased to provide the following operational update:

Block V

Operations at the Snow Leopard-1 well were completed on 25 September 2018 and the rig is currently being dismantled and mobilised to the Wild Horse 1 location in Block IV. Once the rig has left, the site will be reclaimed and restored to its pre-drill condition.

The water well drilled at site which was used to provide water for the drilling operation will be handed over to the local community as part of the social development programme that is being conducted in parallel with the drilling operations.

Data and samples gathered during the drilling of the well are now under evaluation to determine the implications of the well results for the surrounding prospectivity. The presence of thick shales and oil and gas shows in the well highlight the potential prospectivity of the Taats basin in which a number of other prospects and leads have been mapped.

Environmental permitting for two potential drilling locations on the 200MMbo Fox prospect in the Tugrug Basin is advancing with a target of securing approval by the end of 2018, in good time for the start of the 2019 drilling season.

Block IV

Site construction at the Wild Horse 1 location was completed on 1 October 2018. The first trucks with rig loads also departed the Snow Leopard location on 1 October 2018 to the Wild Horse location. The spud date for Wild Horse-1, following rig up, is expected to be late October 2018. The well, which is programmed to reach a total depth of 2200m, is expected to take between 30 and 45 days to drill and log.

The winter weather in the area where Wild Horse is located is generally milder than in eastern Mongolia, with operable temperatures lasting through the month of December. The Company remains on track to complete the Wild Horse 1 drilling operation this year.

The Wild Horse prospect is a prominent structural high on the flank of the as yet undrilled Baatsagaan Basin and is ideally located to receive charge from two deep basinal areas mapped to the East and West. The structure has elements of four-way dip closure and fault closure. It also has bright seismic events that appear to conform to structure and which may therefore be indicative of hydrocarbon fluid content. Wild Horse 1 is located to drill through one such anomaly at the crest of the structure. The prospect has a large section within structural closure from c. 700m to total depth and the recoverable resource potential is estimated to be 480MMbo. A number of prospects and leads have been identified in the same basin which would be high graded by encouraging results in Wild Horse 1, including a satellite structure immediately to the East of the Wild Horse prospect.

Block XX

The tender for a rig for the 2019 Block XX drilling campaign is in final draft form and after agreement with the industry regulator is scheduled for issue in mid-October 2018 with the goal of having the contract finalised with the winning contractor by January 2019, well in advance of the weather dependent start of the 2019 drilling season, likely to be early in Q2. All environmental, chemical and land usage permits are already in hand for the prospects in northern Block XX including for Gazelle, Heron and Antelope. Work is underway on the environmental permitting for Red Deer targeting approval before the end of this year.

Mike Buck, the CEO of Petro Matad said:

"Operations continue to progress on track for us to drill and log the Wild Horse-1 well this year. Wild Horse is a very exciting prospect and from the size of the potential prize alone, the Wild Horse 1 well certainly deserves its place in Wood Mackenzie's ranking of the top 20 exploration wells to watch in 2018.

We continue to work hard on preparations for next year's drilling campaign and look forward to updating the market on Wild Horse soon."

For more information, please contact:

 
 Petro Matad Limited 
                                     [phone] / [phone] 
 Mike Buck, CEO                       099 
 
 Stockdale Securities Limited (Nominated Adviser and Broker) 
 Richard Johnson 
  Andy Crossley 
  David Coaten                       [phone] 
 
   Stifel Nicolaus Europe Limited 
   (Broker) 
 Callum Stewart 
  Nicholas Rhodes 
  Ashton Clanfield                   [phone] 
 
   FTI Consulting (Communications Advisory Firm) 
 Sara Powell 
  Ben Brewerton                      [phone] 
 

All Reserves and Resources definitions and estimates shown in this report are based on the 2007 SPE/AAPG/WPC/SPEE Petroleum Resource Management System ("PRMS").

Technical information in this news release has been reviewed by the Company's Exploration Manager, Mr. Jerry Smart. He has 36 years of industry experience in oil and gas exploration and production with LASMO, Eni, Salamander Energy and Ophir Energy. He holds a B.Sc. in Geology from King's College, London.

Glossary

 
MMbo                    million barrels of oil 
Prospective Resources   estimated volumes associated with undiscovered accumulations. These represent quantities 
                         of petroleum which are estimated, as of a given date, to be potentially recoverable from oil 
                         and gas deposits identified on the basis of indirect evidence but which have not yet been 
                         drilled 
 
 

About Petro Matad

Petro Matad is the parent company of a group focussed on oil exploration, as well as future development and production in Mongolia. At the current time, Petro Matad holds the sole operatorship of three Production Sharing Contracts with the Government of Mongolia. Block XX has an area of 10,340 square kilometres in the far eastern part of the country, and Blocks IV and V have an area of 28,900 square kilometres and 21,100 square kilometres, respectively, in the southwest part of the country.

Petro Matad Limited is incorporated in the Isle of Man under company number 1483V. Its registered office is at Victory House, Prospect Hill, Douglas, Isle of Man, IM1 1EQ.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

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October 01, 2018 02:00 ET (06:00 GMT)