TIDMMATD
RNS Number : 2180X
Petro Matad Limited
19 December 2023
Petro Matad Limited
('Petro Matad' or the 'Company' or the 'Group')
Operational Update
LONDON, 19 December 2023: Petro Matad Limited, the AIM quoted
Mongolian oil company, provides the following operational
update.
Key Company Updates
-- The Company continues to push the Government to complete the
regulatory formalities to guarantee land access and allow
completion operations at Heron 1 to commence. Significant progress
has been made with the Matad District authorities with one
outstanding issue at the Provincial level still to complete.
-- The slow bureaucratic process to complete the special purpose
land certification has prevented any in-field well completion
operations but the winter hiatus provides time to complete the
formalities which will allow operations to commence as early as
possible at the start of the operational season in 2024.
-- The Company has completed the restoration of the Heron-1
drilling location in preparation for mobilization of well
completion equipment.
-- The 2022/23 Exploration Tender Round continues with Petro
Matad being confirmed as the selected contractor on the two blocks
for which it submitted applications.
-- The renewable energy JV, SunSteppe Renewable Energy,
continues to make progress on two projects and is pursuing three
others.
Operational Update
Block XX: With Cabinet approval of the special purpose
certification of the Block XX Exploitation Area in early July, a
number of regulatory steps were required to be completed by the
Government under the 2017 legislation covering the granting and
management of such areas. The Central Land Agency has completed the
registration of the area and issued and signed the key Tripartite
Agreement. The Ministry of Mining and Heavy Industry (MMHI) has
also signed, leaving only the Governor of Dornod Province to sign.
He has said he will sign once the money to make compensation
payments to the 10 herder families impacted by the certification of
the area has been transferred to the Provincial Government
account.
In meetings facilitated by the Company, all the herders have
agreed to be compensated. Under the legislation, the compensation
payments should be made from the State budget but recognizing that
this could be a very slow process, the Company offered and the
industry regulator, the Mineral Resources and Petroleum Authority
of Mongolia (MRPAM) accepted that Petro Matad would make these
payments. The money has been paid into the appropriate MRPAM
account and is awaiting transfer to Dornod Province once the
Ministry of Finance gives approval for this to go ahead. The
mechanics of the transfer have taken some time for the Government
to determine but we are pushing and expect this to go through
soon.
The remaining steps in the regulatory process involving issuance
of the special permit to MMHI and the signing of the Land Contract
between the Matad District and the Company have been agreed to go
ahead once the Tripartite Agreement is signed off by the Provincial
Governor.
As part of our interactions with the local authorities, the
Company hosted the Matad District Citizens' Representatives
Committee on a visit to the South Gobi where mining and other
development projects are providing tangible benefits to the local
communities in which they operate. The trip was very successful and
at a meeting to conclude the trip in Petro Matad's Ulaan Baatar
headquarters the Committee thanked the Company, declared their
support for the Company's development activities in Matad and
agreed the terms of the Cooperation Agreement which governs
community aid expenditure during oil exploitation activities. The
Cooperation Agreement is being prepared for signature and will be
executed once land access has been confirmed. In a demonstration of
the improved relationship, the district authorities received a
presentation on a necessary amendment to the Company's
environmental plan, raised no objections and provided the necessary
documentation to allow the Company to secure Ministry of
Environment approval to amend its Detailed Environmental Impact
Assessment.
With the necessary approvals, the Company was also able to
complete the restoration of the Heron-1 drilling location in
preparation for the mobilization of well completion equipment and
the installation of the beam pump, tanks and generator.
New acreage: On the two blocks for which Petro Matad submitted
applications, the Company has been selected as the preferred
contractor. Fiscal terms have been agreed and the Company's
proposed changes to the model Production Sharing Contract are now
with MMHI for review and final submission to Cabinet. The tender
process has slowed in recent months, perhaps in light of political
attention being diverted due to next year's parliamentary
elections. Petro Matad is happy to have been confirmed as the
selected contractor for the areas it has chosen and would like to
see the tender process concluded soon although operational activity
will focus on Block XX in 2024.
Renewables: Our renewable energy JV, SunSteppe Renewable Energy,
continues to make progress under the leadership of its CEO Ms. Zula
Luvsandorj. SunSteppe is progressing several exciting opportunities
including two high graded projects with three more under detailed
technical and commercial review.
Mike Buck, CEO of Petro Matad, said:
"On the land issue, we feel that we are almost there, but we
will keep pushing until the process is complete. In the absence of
any recent precedents, every step has been something new for the
Government which has caused delays. We will certainly be ready to
operate at the end of the winter stand down when we expect the long
running saga of land access to be fully resolved."
Further operational updates will be provided in due course.
- Ends -
Further information please contact:
Petro Matad Limited
Mike Buck, CEO +976 7014 1099 / +976 7575 1099
Shore Capital (Nominated Adviser and Broker)
Toby Gibbs
Rachel Goldstein +44 (0) 20 7408 4090
Zeus (Joint Broker)
Simon Johnson
Louisa Waddell +44 (0) 20 3829 5000
FTI Consulting (Communications
Advisory Firm)
Ben Brewerton
Christopher Laing +44 (0) 20 3727 1000
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 100% working
interest and the operatorship of two Production Sharing Contracts
with the Government of Mongolia. Block XX has an area of 218 square
kilometres in the far eastern part of the country and Block V has
an area of 7,937 square kilometres in the central western 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.
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END
UPDFFDESAEDSELE
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December 19, 2023 02:00 ET (07:00 GMT)
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