Petro Matad shares rose on Thursday after the company announced solid progress in its Mongolian Block XX field as the company gears up to begin production.
Shareholders would have been pleased to learn the Mongolian-focused oil and gas exploration company is well on its way to becoming a producer, with operations at the Heron-1 well progressing as planned.
During recent preparation work, the Heron-1 well was found to be in good condition, and the company said it is ready to begin installing production facilities.
Petro Matad is on track to become a producing company in the very near future, failing any unexpected delays. Not only do investors have this important milestone to look forward to, but also the results of two exploration wells being drilled at Heron-2 and Gobi Bear.
In recent years, Petro Matad has focused largely on obtaining the government approvals required to achieve the first oil at Heron-1, while the prospectivity of the remainder of the Block XX field has received little attention.
The two upcoming drills have the potential to expand Petro Matad’s resource base and enhance the company’s investment case.
After recently raising around $9m, the firm is well funded and should be able to support further testing and evaluation of the field with cash flows from production.
We highlighted Petro Matad as a company to watch over the summer. Today’s announcement validates that view.
“With the Heron-1 down-hole completion now ready for production startup, the well site has been prepared for the installation of the surface production facilities. We are pleased to have concluded our negotiations with DQE and look forward to continuing to work with them on the 2024 drilling programme,” said Mike Buck, CEO of Petro Matad.
“The team is now working at pace to spud Heron-2 in mid-September and to secure the required construction permits for Heron-1.”