Drilling disappointment for Petro Matad

Shares in oil explorer Petro Matad took a sharp dive after it reported disappointing testing results from its operations in eastern Mongolia.The test on its DT-1 well at the Davsan Tolgoi project was judged to be a failure."The failure of the DT-1 test, due to mechanical issues is considered to be a relatively minor setback in our overall progress at Davsan Tolgoi," chief executive Doug McGay said. "The inexpensive well costs, in both monetary and time terms, mean that alternative actions can be taken quickly and the possible loss of the initial investment in the DT-1 well's drilling and testing is the only setback when viewing the larger picture of our company's and its programme's progress."At DT-9, also in Davsan Tolgoi, the company experienced a "test failure."McGay said: "While very disappointing, DT-9 was in both a separate structure and a different reservoir than previously drilled locations on Davsan Tolgoi. Thus the test failure is not seen as an adverse judgement on the overall Davsan Tolgoi complex."At 09.00am, shares in Petro Matad were down by 29% at 56p.---RG Petro Matad