TIDMMATD
RNS Number : 1120A
Petro Matad Limited
22 May 2023
22 May 2023
Petro Matad Limited
("Petro Matad" or the "Company")
Operational Update
Petro Matad (AIM: MATD), the AIM quoted Mongolian oil company,
provides the following operational update.
Key Company Updates
-- Rig arrival and Velociraptor 1 spud are forecast during the first half of June.
-- Mobilization of site construction equipment to the
Velociraptor 1 well location has commenced.
-- Documentation proposing the certification of the Block XX
Exploitation Area as Special Purpose Land for submission to Cabinet
is being prepared by the ministries responsible.
-- Negotiations with the Government for a new block in
Mongolia's 2023 Exploration Tender Round are continuing.
Block V Exploration
Mobilisation of equipment to prepare the drilling location and
to set-up the camp for Velociraptor 1 operations has commenced. A
ll required equipment for the well is in the country. The water
source well for the operation has also been prepared for
production. All activities are planned to be completed in advance
of rig arrival which is forecast by contractor Major Drilling to
arrive at site in early June and to spud the well by the middle of
the month. The Velociraptor 1 well is expected to reach the
prognosed total depth of circa 1500 metres in circa 30 days
following which the well will be logged and the results evaluated.
In the event of encouragement in the well, the rig contract allows
for follow up with an appraisal well. All permits are in place for
Velociraptor 1 and the contingent appraisal drilling.
Velociraptor 1 is targeting an inversion anticline with
recoverable resource potential of 200 million barrels and the
adjacent Oviraptor and Tsagaanraptor prospects would be
significantly de-risked by success and have the potential to triple
the resource potential on the exciting Raptor Trend. Whilst there
has been very little exploration drilling done in this part of
Mongolia, Velociraptor 1 is located 7 km south of the Snow Leopard
1 well drilled by Petro Matad in 2018. This well found excellent
oil source rocks and oil shows and proved that there is a working
petroleum system in the Taats Basin in which the Velociraptor
prospect is well located to receive hydrocarbon charge.
With the well cost estimated to be less than $2 million, with
attractive fiscal terms and a low cost onshore operating
environment, Velociraptor 1 is an excellent opportunity in global
oil exploration.
A further notification will be issued once Velociraptor 1 has
spudded.
Block XX Exploitation Licence
Documentation prepared by the Ministry of Mining and Heavy
Industry (MMHI) for submission to Cabinet to secure approval to
certify the Block XX Exploitation Area as a Special Purpose Area
was completed. However, the Ministry of Construction and Urban
Development has insisted that as the ministry responsible for land
issues, the Cabinet submission must come from them. As a result,
they are repeating the step of asking all other ministries for
comments after which we expect they will make the submission. The
loss of more time whilst this is done is frustrating but highlights
the fact that this is the first oil project to be put through this
bureaucratic process based on regulations introduced in 2017 and
the authorities involved have no obvious precedent to follow. The
Company continues to push at all levels to underscore the
importance of this licence for the Company and industry in
Mongolia.
At the local level, the Company continues to engage with
stakeholders and has also offered support to the province which is
suffering from wildfires on the steppe due to recent dry
conditions.
2023 Exploration Licencing Round
Negotiations with the Mineral Resources and Petroleum Authority
of Mongolia (MRPAM) on the application for a block in Phase 1 of
the 2023 open tender exploration licencing round continue.
Discussions on changes to the Production Sharing Contract (PSC), on
the proposed work programme and on fiscal terms have been
completed. This part of the process involved a visit to the UK and
to the Isle of Man by representatives of MMHI and MRPAM and we were
honoured to be accompanied on the trip to the Isle of Man by the
Mongolian Ambassador to the UK. Petro Matad continues to review
other blocks in the tender round with a view to potentially
submitting further block applications on those it high grades.
Mike Buck, CEO of Petro Matad, said:
"Preparations to drill Velociraptor 1 are well advanced and we
are excited to spud in June and to explore the potential of the
Raptor Trend.
"It is highly frustrating that the good work done by MMHI on the
certification of the Block XX Exploitation Area as Special Purpose
Land is now having to be repeated, but it is essential that the
process is followed in full compliance with legislation.
Shareholders can be assured that we are continuing to provide all
input and assistance to the authorities in securing the
certification.
"The recent visit to UK with senior representatives of MMHI and
MRPAM provided an excellent opportunity to further strengthen our
relationships with both organisations and we were honoured to be
joined by H.E. Ambassador B. Enkhsukh, Mongolia's ambassador to the
UK, on the visit to the Company's corporate agents in the Isle of
Man."
- Ends -
Further information please contact:
Petro Matad Limited
Mike Buck, CEO +976 7014 1099 / +976 7575 1099
Shore Capital (Nominated Adviser and Joint Broker)
Toby Gibbs
John More R achel Goldstein +44 (0) 20 7408 4090
Zeus Capital Limited (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
All Reserves and Resources definitions and estimates shown in
this report are based on the 2018 SPE/AAPG/WPC/SPEE Petroleum
Resource Management System ("PRMS").
Technical information in this news release has been reviewed by
the Company's Technical Manager, Mr. Jerry Smart. He has over 40
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.
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
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