10th Jan 2019 14:12
LONDON (Alliance News) - Petro Matad Ltd on Thursday said it is continuing preparations for a four-well drill programme at Block XX in Mongolia and noted that findings from its Block V drilling have been "very positive".
Shares in Petro Matad were up 6.0% at 3.10 pence on Thursday.
Technical work has continued towards detailed prospect mapping for the northern area of Block XX, with revised mapping expected to complete in February.
So far, this technical work has confirmed existing mapping of both the Heron and Gazelle prospects in Block XX, as well as improving understanding of the Antelope prospect.
The Heron-1 well, which will be located in the Heron prospect, is likely to be located less than 1 kilometre to the south of the Petro China discovery well L19/46-3.
The Heron prospect is an extension of L19/46-3 and will therefore be an appraisal well for an existing discovery.
Petro Matad already has permits for the two well programmed for drilling in the northern area of Block XX covering any chosen location, and is in the process of acquiring another two if this proves successful.
The permit for the Red Deer-1 well, also in Block XX, is "expected to be approved shortly", Petro Matad said.
A well testing contract is already in place at Block XX and establishing the commerciality of the block will be "an important goal" for the company.
The tender processes for Petro Matad's 2019 drill programme are at their advanced stages, with evaluation of the bids "near completion" and regulatory discussions in progress.
"We aim to complete contract negotiations with the winning bidder in time to ensure rig mobilisation in April 2019 to spud the first well in the northern area of Block XX," Petro Matad said.
At Block V, geochemical analysis of the Snow Leopard-1 well has indicated that the oil found in the drilling fluid at a 1,415 metre depth is light, and "migrated from a mature source rock". Petro Matad said it was a "very positive" finding for the surrounding prospects in the basin.
Petro Matad Chief Executive Mike Buck said: "We are very keen to start operating in Block XX as soon as the weather permits, and our initial focus will be on near field exploration and appraisal where the targets we are pursuing have good chances of success and can be highly value accretive and material for the company.
"The ongoing evaluation of the 2018 drilling results has generated some exciting possibilities for follow up in Block V. 2019 is a key year for Petro Matad and we look forward to delivering the four well drilling programme and, with success, moving the company towards commercialisation."
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