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Having gone through the AGM details, I believe the market may be overlooking some very important developments.

Most investors are understandably focused on the farm-out and the delayed payments, but what really caught my attention was Gazelle.

According to the AGM, Gazelle-1 initially produced at over 400 bopd and had already paid back its costs by early 2026. If confirmed by future operational updates, that is a significant achievement for a company of PM's size and suggests Gazelle could become a much more important asset than many currently assume.

I was also encouraged to hear that Heron-2 has not been written off. Management is evaluating radial drilling technology which could potentially unlock much better flow rates. H2 still appears to have multiple paths to creating value.

Another point that seems to be flying under the radar is the planned 150 km² 3D seismic campaign. Combined with the "shoot now, pay later" structure, PM can improve its understanding of the field and strengthen its farm-out position without a major immediate cash burden.

Add to that over $3 million in cash, approximately 35,000 barrels of oil in storage awaiting sale, ongoing production, multiple farm-out discussions and the long-term upside of Block VII, and I struggle to see the doom-and-gloom narrative some posters are pushing.

The farm-out remains the big prize, of course. But after listening to the AGM, I came away feeling that PM now has more moving parts and more potential value drivers than at any point in recent years.

Just my opinion, but I think the market is focusing on the delays while missing some very significant progress happening in the background.

I actually see this RNS far more balanced than some posters here suggest.

Yes, there are frustrations:

payment delays remain annoying,

production is naturally lower than the initial flow period,

and the farm-out process is taking time.

But let’s also stay factual and look at what the company didn’t say.

They did not say:

farm-out talks collapsed,

Heron-2 failed,

Gazelle is abandoned,

Gobi is dead,

or that PetroChina stopped cooperation.

In fact, the opposite is true in several areas.

Heron-1 continues to produce stable oil with low water cut and ongoing cashflow. H2 is still considered technically valuable, either as a producer or potentially as a water injector to enhance field recovery. Gazelle remains a very interesting near-term catalyst with infrastructure synergies already in place. Gobi is still actively progressing.

And importantly: discussions with partners are still ongoing.

To me, this RNS reads less like a company in trouble and more like a small oil producer moving forward step by step in a difficult sector where timelines are rarely linear.

Could communication be better? Probably yes.

Could progress be faster? Of course.

But some posters here seem to interpret every delay as total failure while ignoring the very real operational progress that has already been achieved.

Personally, I still see multiple catalysts ahead — and I think the market sentiment remains far more negative than the underlying operational reality.

I completely agree @Proquo!

If negotiations had collapsed or if there was simply “nothing going on”, I also believe PM would already have released a straightforward operational update. Instead, we continue to get this unusual silence around the bigger picture — and in my opinion that strongly suggests that discussions are still active behind the scenes.

People also forget that the geopolitical landscape has changed dramatically over recent months. Oil security, stable jurisdictions and long-term supply have become much more important topics again. Mongolia suddenly looks a lot more attractive in that context.

And now we also have the satellite images showing very clear signs of activity around the sites — restored access roads, visible ground disturbance and operational movement. To me, that is another strong indication that things are actively progressing on the ground and that preparations/work are continuing as planned.

Of course, nothing is guaranteed until signatures are on paper, but I think the market is underestimating the significance of all these combined signals.

With the AGM coming up, I believe we may finally start getting more concrete information regarding the direction PM is heading. The next few weeks could become very interesting indeed.

I’m not so sure anymore that we’re still talking about just one interested party.

Let’s not forget: the last meaningful update from PM regarding the farm-out came before the Iran conflict and the resulting oil price shock. Since then, the macro environment has changed quite significantly.

Higher oil prices and increased geopolitical uncertainty tend to increase interest in stable, underexplored regions. That could very well mean that additional parties have entered the picture quietly in the meantime.

Of course, this is speculation—but it would actually make a lot of sense. If multiple parties are now involved, that could explain why things are taking time and why PM isn’t rushing out with a concrete update. In such a situation, you would naturally let the process play out to improve terms rather than jump at the first offer.

So instead of seeing the silence as a negative, I could also interpret it as a sign that more is going on behind the scenes than we are currently aware of.

Just my view—but the timing of recent macro events shouldn’t be ignored.

The recent conflict around the Strait of Hormuz has once again highlighted just how fragile the global energy system really is. A region through which around 20–30% of the world’s oil supply flows is now under serious disruption, leading to rising prices and global uncertainty .

This situation clearly shows how exposed the world still is to geopolitical risks in the Gulf region. And whenever such instability occurs, attention naturally shifts toward safer, more politically stable regions for oil production.

That’s where countries like Mongolia come into play. A stable environment, growing infrastructure, and increasing strategic relevance make projects there significantly more attractive in times like these.

In my view, this strengthens Petro Matad’s position in ongoing farm-out discussions. Potential partners will be even more aware of the value of diversifying away from high-risk regions.

Of course, we still need to see how things develop—but the macro backdrop is clearly moving in our favor.

I remain very confident about what’s ahead.

With winter season nearly behind us, we’re approaching the part of the year that has historically been much more constructive for PM’s share price. Anyone who’s been here for a few years can see the pattern quite clearly: winter is quiet, operationally constrained, sentiment fades… and then activity resumes.

As the operating window opens up again, newsflow returns, catalysts re-enter the picture, and the market starts to look forward rather than backward. We’ve seen this seasonal shift play out more than once.

This year, it feels even more relevant given the stacked pipeline of upcoming work. As always, just my view—but seasonality has been a real factor here in the past, and it’s worth keeping in mind.

The MoU with PetroChina (signed last week) lands days after the U.S. operation that removed Maduro, a move that threatens to disrupt the Venezuela→China crude route (a major outlet for Venezuelan barrels in 2025). If Beijing expects turbulence on that flow, it’s rational to lean into near-border, politically aligned barrels—i.e., Mongolia—and formalize cooperation that speeds processing/offtake, grid access, and tie-ins in Tamsag.

I’m not claiming causation—but the correlation is compelling: China’s Venezuela exposure was meaningful (hundreds of kbpd), and the U.S. action injects uncertainty. A PM–PetroChina framework now looks like a no-regrets diversification hedge that also de-risks PM’s execution and strengthens farm-out optics.

Side note: I’m still surprised there isn’t an RNS—an MoU can be non-binding and not automatically price-sensitive, but a brief confirmation in the next update spelling out what’s concrete (access terms, timelines, metering/handling process) would help the market. Until then, the read-through remains constructively positive for PM.

Today’s MoU between Petro Matad and PetroChina’s Mongolian affiliate is a bigger signal than it looks. It formalizes cooperation in the Tamsag region (Dornod) where they’re adjacent operators on three exploitation blocks, and it was signed on stage at a Mongolia–China investment event with the PRC Embassy, MNCCI and the Chinese Chamber of Commerce present. That’s political cover plus operational intent—exactly what PM needs for scale.

What the MoU likely unlocks (read-throughs):

- Infrastructure sharing at lower cost: smoother access to PC’s processing, storage, power grid and trucking/pipeline interfaces. That can compress PM’s Opex and cycle times (think faster tie-ins like the Heron grid connection and cheaper third-party services).

- Commercial chain reliability: formal cooperation should help standardize metering, offtake and documentation, which has been the friction point behind partial withholdings. An MoU gives both sides a framework to sort tax/VAT implementation and payment workflows.

- Field development acceleration: coordinated planning on pads, roads, HSE, gas handling and water logistics reduces duplication and permits. That directly improves NPV on Heron and follow-ups (Gazelle, Gobi).

- Strategic leverage for farm-out: a standing cooperation framework with the dominant regional operator de-risks execution for any incoming partner and strengthens PM’s hand in negotiations.

- Policy tailwind: the setting (Mongolia–China forum) signals government-to-government alignment on energy cooperation. That matters for future export routes, pipeline access and the refinery feed narrative.

Bottom line: This isn’t just optics. For a small operator beside the basin incumbent, a cooperation MoU is a de-risking milestone: faster hookups, cleaner cash conversion, and cheaper barrels. Combine that with H2/Gazelle/Gobi near-term work and PM’s case for a re-rate gets stronger. I see this as decisively positive for operations, commercial flow and farm-out probability.

Petro Matad has provided an update on its producing assets in Block 20 and progress in its renewable energy joint venture, Sunstep. The new Mongolian government (since mid-2024) is prioritizing energy independence, focusing on reinvigorating the oil sector and maximizing renewable energy potential.

Block 20 Oil Production

• Heron 1 is maintaining stable production, currently delivering between 135 and 145 barrels per day (bpd). Over 70,000 barrels have been produced cumulatively, and the water cut remains very low (less than 3%). The Heron well site is now fully electric powered.

• Gazelle 1 was brought into production by the end of October, initially reaching a maximum test rate of about 400 bpd. The team is currently optimizing production to mitigate water ingress.

• The domestic refinery, which requires 30,000 bpd of feedstock, is currently scheduled to be operational by 2028.

Finance and 2026 Strategy

Petro Matad is now generating sufficient revenue to cover its operational expenditure (OPEX). The company is actively working to resolve the long-running dispute with Petrochina regarding the contractual withholding of revenue, currently totaling approximately $850,000 USD, which they expect to receive in early 2026,.

The main strategic goal for 2026 is securing a Block 20 farm-out partner to finance an expanded work programme, including infill drilling and 3D seismic acquisition, rather than conducting a new equity raise,.

Sunstep Renewables

The Sunstep joint venture is progressing four advanced projects aligned with Mongolia's goal of energy security and climate neutrality,. The highest priority project is a 200 MW hybrid system (solar, wind, and battery storage), which is targeted to be ready-to-build (RTB) in 2026,. Developing projects to RTB status is expected to create significant value, with an anticipated development premium of $50,000 to $100,000 per megawatt.

@Velocoraptor,

Great summary — clear, punchy and helpful for new readers!

What surprises me, though, is that no one has flagged a missing puzzle piece: Gobi Bear-1. It’s very much part of the near-term plan right after Gazelle-1 and deserves a mention.

Why Gobi matters

Queued catalyst: A low-cost flow test on ~10 m is scheduled in the same weather window (sequence: Heron-2 re-test → Gazelle-1 DST → Gobi Bear-1).

Positive indicators: Geochem on cuttings confirmed migrated oil, and logs highlight a zone with lower water saturation — exactly what you test to prove a trapped pool.

Asymmetric upside: Even a modest flow would add barrels, de-risk the southern play, and broaden the portfolio beyond Heron/Gazelle.

Independent bet: Gobi’s geometry and risk drivers are different from H2; its outcome isn’t dictated by H2’s result.

Bottom line: fantastic overview — and with Gobi Bear included, we’ve got three shots on goal in quick succession.

Worth noting: we got no after-hours RNS on Friday. On AIM, clear negatives often get parked late on a Friday; the absence of that suggests no immediate adverse event requiring disclosure. Heron-2’s acid-wash/retest is still within the guided window—if it had obviously failed and they were switching to injector, they’d likely have said so. For me, the lack of a Friday shock is neutral-to-positive and consistent with H2 generating data worth evaluating (or stabilising). Still need the formal result, but the read-through is constructive.

@Hamm,

I don’t think that conclusion follows.

- Proven system: Heron-1 is onstream and selling oil. That alone proves the charge, trap and migration are working in Block XX. One well underperforming does not invalidate the play.

- H1 vs H2 ≠ binary: H2 sits ~800m from H1 and is ~16m structurally higher. The issue flagged was lower permeability, not lack of oil. That’s why they’re doing an acid-wash/re-test and, failing that, have the injector fallback—which can increase H1’s rate and recovery. Many fields are developed with a mix of producers and injectors.

- “Silence = failure” is speculation: The company guided a defined test window and said they’d move to Gazelle then Gobi. Interpreting the lack of an interim headline as failure is just guesswork; you could read it the opposite way (they’re executing the plan and analysing data properly).

- Gazelle & Gobi are different bets: Gazelle has logged pay and a thick “C” sand up-dip target; a full DST with gauges is planned. Gobi has migrated oil in cuttings and a low-cost flow test queued. Their probabilities are not perfectly tied to H2’s flow—geometries and reservoir qualities differ.

- Farm-out impact: Partners assess a portfolio, not a single rate test. PM now has production covering G&A, cost cuts (grid tie-in), licence/time runway, and multiple near-term catalysts. Even if H2 ends up as an injector, that improves field economics—not a deal-breaker.

Bottom line: declare success or failure when the tests finish, not before. One tight well doesn’t negate a proven, producing discovery—nor the value of the next two catalysts.

@ftsemajorgeneral,

I disagree. With three interested parties (per MB’s interview), the dynamic flips to competitive tension on the bidders, not time pressure on PM.

a) Option risk for bidders: If one moves to LOI/terms first, the others lose the slot. That creates natural urgency on them to sharpen offers and timelines.

b) PM isn’t cornered: PM now has production covering G&A, cost cuts (grid tie-in), and multiple near-term catalysts (H2 re-test, Gazelle, Gobi). That reduces the need to accept a weak deal.

c) Process already advancing: A FOA draft and LOI circulation were referenced—i.e., PM can let competition play out to secure better terms rather than rushing.

d) Budget/rig cycles: Any partner wanting 2026 activity needs to book capital and rigs now. Delay hurts them more than PM.

Worth noting: PM is hitting the milestones it set out. Heron-2 acid-wash & re-test kicked off exactly when guided, Gazelle-1 is queued for September, and Gobi Bear-1 follows within the same weather window. Payments are progressing, and the Block XX licence (incl. duty holiday) has been extended—exactly as flagged.

So much for the “they’ll slip again” narrative. This time the company gave a tight, near-term timetable—and so far, they’re executing to it.

Tighter timeline, real catalysts. Heron-2 acid-wash & re-test is underway now (c.~20 days); Gazelle-1 follows in September, then Gobi Bear-1—so results land in weeks, not months. Payments keep moving (May/June received), with 30% temporarily withheld pending a tax letter that PM says is being prepared; July invoice is in. Big plus: Block XX exploitation licence extended 3 years, and the import-duty holiday extends too—clear cost/NPV benefit. Farm-out is also advancing (FOA draft sent; LOI circulating). Net: denser H2 newsflow, lower execution risk, and multiple near-term shots on goal. I read this as positive with the main watch-item being the tax sign-off that unlocks full payments.

Timestamp: ~09:45–10:05 : What he said (paraphrase): “We have one counterparty very well advanced in their evaluation and they seem keen. We’re also talking to two other parties, though they’re not as far along.”

It’s not in the written RNS. In the later Q&A (~46 min onward) he talked about doing a farm-out (not a JV) and confidentiality, but the “one counterparty well advanced” wording is from the ~10-minute mark of the presentation.

Hi @badprophet,

Yes—he said it in the Investor Meet Company presentation, not in the RNS, at around 46:22 :

"we are um hopeful and confident of getting in a partner, a farming partner"

- Payments: PetroChina’s new internal e-payment system is causing delays across counterparties; they guided payments resuming in August.

- 30% holdback: Could relate only to minor VAT on handling/management fees; PM is renegotiating terms to reduce/eliminate. PM is withholding royalties/Gov take until resolved.

- Unit economics: At ~$70/bbl, PM sees ~$40/bbl netback; current production generates ~$150–200k net cash/month.

- Heron-1 costs: Grid tie-in in Aug/early Sept targets ~15% Opex reduction (no more 200–300 L/day diesel burn).

- Heron-2: Cuttings show carbonate cement → acid wash + re-test in August; CEO put ~70–75% chance on achieving a commercial rate. Fallback is water-injection to support H1 (response in 6–12 months).

- Gazelle-1 test: 8 m perforation + full DST with gauges; 30–50 bpd already commercial. Upside in a ~45 m “C” sand @ ~14% φ (c. 5 MMbbl up-dip potential).

- Gobi Bear-1: Geochem shows migrated oil; low-cost test planned if window allows.

- Heron resource: 200 MMbbl in place; now working assumption >30% recovery (60 MMbbl).

- Farm-out: One counterparty well advanced, two others active—aim is partner-funded drilling (not more dilution).

- Cost discipline: 70% salary cut for the three expat execs (incl. CEO); production covers G&A.

- Infrastructure: Refinery pipeline ~97% welded / ~67% buried.

- Renewables (Sunsteppe): Developer premiums in Mongolia $50–100k/MW at RTB; ~274 MW near-term pipeline; PM funding the 200 MW project 100% to accelerate RTB.

Bottom line: Tighter timelines, clearer cash path, and multiple near-term tests (H2/Gazelle/Gobi) create real H2 momentum, while a potential farm-out is the key accelerator without further dilution.

MB said he is “hopeful and confident” of securing a farm-in partner (confident!!). One counterparty is well advanced, with others still engaged. A farm-out would bring partner-funded drilling instead of fresh dilution, accelerate Heron development (step-outs/horizontals), and validate the asset. With H2 re-test plus Gazelle and Gobi lined up in the coming weeks, the timing looks ideal to crystallize terms.

What really jumps out in this RNS is how specific and compressed the schedule is—very different from the old “in due course” language. We now have a clear, near-term sequence with weeks, not months of waiting:

- Heron-2 re-test on a defined window,

- Gazelle and Gobi tests queued right after,

- Cost-cut steps (grid tie-in) and the next payment cycle on a set timetable,

- Farm-out process moving through a named stage.

This tighter plan reduces wiggle room, lowers execution uncertainty, and gives the market hard checkpoints to track. In short: we’ll see very soon where this is heading—and that clarity itself is a catalyst. I’m encouraged by the near-term, back-to-back milestones lined up.