Petro Matad Regulatory News (MATD)

Petro Matad Limited

("Petro Matad" or the "Company")

Fundraising of US$5 million

Petro Matad is pleased to announce that it has raised $5 million before expenses through the issue of 90,612,540 ordinary shares (the "New Shares") of US$0.01 each to its largest shareholder Petrovis Matad Inc. ("Petrovis") (the "Funding"). The New Shares have been issued to Petrovis at an issue price of 3.56 pence per ordinary share.

The net proceeds of the Funding, along with the Company's existing cash reserves of approximately US$2.1 million will enable Petro Matad to undertake field operations during the current 2013 field season. As previously notified to the market, Petro Matad is in the process of conducting a farm-out. The Company has had a number of international companies visit the farm-out data room, the data room is now closed and Petro Matad is continuing discussions with interested parties. It is anticipated that the Company will be in a position to make a further statement on the progress with this transaction during the third quarter.

The support of Petrovis will enable the Company to proceed with 2013 exploration field-work ahead of the completion of a farm-out. Prior to deciding to proceed with the Funding the Company evaluated the funding options available to Petro Matad in what are difficult equity capital market conditions for junior oil exploration companies. Against this backdrop, the Company is fortunate to have Petrovis as a supportive shareholder and the board was delighted to be able to conclude the transaction.

Changes to Notifiable Holdings

Following the issue of the New Shares, Petrovis will hold directly an aggregate of 127,296,802 ordinary shares in the Company representing 45.9 per cent. of the Company's issued share capital. As Dr Oyungerel Janchiv, a director of Petro Matad controls more than 20% of Petrovis, Dr Oyungerel's direct holding, of 6,585,000 ordinary shares in the Company, is for disclosure purposes aggregated with that of Petrovis under the AIM definition of director's family. The aggregated holding of Dr Oyungerel and Petrovis is 133,881,802 ordinary shares representing 48.3 per cent. of the Company's enlarged issued share capital.

Concert Party Holding

Following the issue of the New Shares the combined holdings of Petrovis together with those parties whom the Company consider would be deemed to be a concert party of Petrovis is 142,056,802 ordinary shares representing 51.23 per cent. of the enlarged issued share capital.

Related Party Transaction 

The issue of the New Shares is a related party transaction under the AIM Rules for Companies. Accordingly, the Company's Independent Directors (being all of the directors with the exception of Oyungerel Janchiv and Enkhmaa Davaanyam who are connected to Petrovis Matad Inc.) consider, having consulted with Westhouse Securities Limited the Company's Nominated Adviser, that the terms of the transaction are fair and reasonable insofar as the Company's shareholders are concerned.

Total Voting Rights

Following the issue of the New Shares, Petro Matad will have 277,288,541 ordinary shares in issue. There are no ordinary shares held in treasury and therefore the total voting rights in the Company will be 277,288,541.

Authority and Admission to AIM

The New Shares will be issued under the board's existing authorities. Application has been made for the New Shares to be admitted to AIM and it is anticipated that this will occur on or around 18 June 2013.

About Petro Matad Limited

Petro Matad is the parent company of a group focussed on oil exploration, as well as future development and production in Mongolia. The Group holds the sole operatorship of three Production Sharing Contracts with the Government of Mongolia. Block XX has an area of 10,340km² in the far eastern part of the country. Blocks, IV and V are located in central Mongolia. Block IV covers approximately 29,000km² and Block V approximately 21,150km².

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.

Further information:

Petro Matad Limited

George Watkins, Chairman

+976 11 331099

NOMAD and Joint Broker

Westhouse Securities Limited

Richard Baty / Ian Napier

+44 (0)20 7601 6100

Joint Broker

Macquarie Capital (Europe) Limited

Steve Baldwin / Nicholas Harland

+44 (0)20 3037 2000