Last checked at 31 Aug 2010 07:00
Petro Matad Limited ("Petro Matad" or the "Company")
Davsan Tolgoi-2 Exploration Well Spud and Operations Update
Spudding of DT-2
Petro Matad (AIM:MATD) announces that the Davsan Tolgoi-2 ("DT-2") exploration well was spudded at 13:15 Mongolian time on 28 August 2010 (06:15 on 28 August 2010 BST).
The DT-2 well is being drilled vertically to an estimated target depth of approximately 1,300 metres. The DT-2 well is being drilled with the company's contractor, the Chinese company Ansai Yuehua Oil Tech Company Ltd. Drilling operations are expected to take approximately 25 days and a further announcement will be made once drilling is completed, or as appropriate. DT-2 is the second exploration well to be spudded as part of Petro Matad's three well drilling programme for 2010 on its Production Sharing Contract on Block XX in Eastern Mongolia, one of three exploration blocks owned and operated by the Company in Mongolia. DT-2 is located approximately 930 metres south-southwest of DT-1, where the Company encountered a 71 metre thick section of Tsagaantsav formation with oil shows and elevated mud gas over the entire interval (see RNS Number 4238P, 15 July 2010).
The previous concept for siting the second well 4km west of DT-1, on a separate structure known as Davsan Tolgoi West, was reconsidered. In view of the encouraging results of DT-1, the Company decided to locate the DT-2 well on the major Davsan Tolgoi prospect, and on the same structure as DT-1 to improve its understanding of this primary prospect.
Production tests will be carried out on one of three wells being drilled this year and a decision on which well to test will be made later in the programme.
Blocks IV and V exploration
The 2D seismic survey over Blocks IV and V is approximately two-thirds completed. Preliminary interpretation of the field processed data has demonstrated that the basins are much deeper than inferred from the gravity data, and has confirmed the presence of structures which could form hydrocarbon traps.
The infill gravity survey over these central Mongolian blocks is also still in progress.
Technical information in this news release has been reviewed by the Company's Exploration Manager, Dr James Coogan. Dr Coogan is a petroleum geologist with 29 years of experience in North American and international exploration and development.
He is a member of the American Association of Petroleum Geologists and the Geological Society of America.
Further information about the Company:
Petro Matad Limited
Douglas J. McGay- CEO
+976 11 331099
Westhouse Securities Limited
Richard Baty/Petre Norton
+44 (0)20 7601 6100
Note to Editors:
About Petro Matad Limited
Petro Matad is the parent company of a group focused 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. The principal asset is the PSC for Block XX, a petroleum block of 14,250km² in the far eastern part of the country. The two other blocks, IV and V are located in central Mongolia and jointly cover 71,040km².
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.