Petro Matad Announces Final Results for Year Ended 31 December 2020

Source: www.gulfoilandgas.com 6/22/2021, Location: Asia

Petro Matad Limited, the AIM quoted Mongolian oil company, announces its audited final results for the year ended 31 December 2020. All monetary values are expressed in United States dollars unless stated otherwise.

Block XX Operational Highlights

• During the course of 2020 Petro Matad focused on progressing the Block XX Exploitation Licence application, working closely with the relevant Mongolian government authorities.

• The Company applied for and was granted a moratorium on Block XX whilst the Exploitation Licence application progressed.

• A Competent Persons' Report for the northern part of Block XX including the Heron structure was prepared by independent reserves certifiers LEAP Energy. LEAP's total mean unrisked in-place oil resource estimation for the Heron structure was 194 million barrels, some 20% higher than Petro Matad's internal estimate.

• The Company secured approval of the Detailed Environmental Impact Assessment (DEIA) for the Heron development phase as part of the Block XX Exploitation Licence application process.

• The Ministry of Mining and Heavy Industry (MMHI) approved the Company's Reserves Report for the Heron discovery which is a critical step in securing the Exploitation Licence.

• An assay of Heron 1 oil was carried out and confirmed that it is a light, sweet, waxy crude very similar to the oil produced in the neighbouring Blocks XIX and XXI and is one of the lightest oils found to date in the Tamtsag Basin.

Blocks IV & V Operational Highlights

• The Company relinquished Block IV with a view to potential partnering and relicensing of its more prospective areas in the future. The Company made a partial relinquishment of Block V, retaining the prospective Taats and Tugrug basins and applied for and was granted a moratorium to allow more time to secure partners and/or funding for the next phase of Block V exploration.

Corporate Highlights

• The Company put in place cost saving measures to preserve its financial resources while progressing the Block XX Exploitation Licence application, recognising the delays caused by the COVID-19 pandemic.

• The Company announced in October the retirement of John Henriksen who served as Executive Director and Chief Financial Officer since 2012, with the resignation effective as of 31 December 2020.

Financial Highlights

• At 31 December 2020, the Group's cash position was $939,000 including Term Deposits (Financial Assets) (31 December 2019: $2.8 million).

• The Group's net loss after tax for the twelve months ended 31 December 2020 was $3.2 million (31 December 2019: loss $16.8 million).

• No dividends have been paid or are proposed in respect of the year ended 31 December 2020 (2019: Nil).

Post Period End

• The Company and the Mineral Resources and Petroleum Authority of Mongolia (MRPAM) have agreed the area of Block XX that will be retained under the Exploitation Licence which includes the entire extension into Block XX of the proven and producing Toson Uul Basin.

• A Competent Persons' Report for the northern part of Block XX including the Heron structure was prepared by independent reserves certifiers LEAP Energy. LEAP's total mean unrisked in-place oil resource estimation for the Heron structure was 194 million barrels, some 20% higher than Petro Matad's internal estimate.

• Petro Matad has now lodged with MMHI its formal application for the award of the Block XX Exploitation Licence.

• To ensure funding of the Company through the Exploitation Licence application process and the preparations for the next phase of operations, the Company's largest and founding shareholder, Petrovis Matad Inc. (Petrovis) agreed to make available to the Company a loan facility of up to $1.5 million, against which the Company can draw funds as required. $0.45 million was drawn in June 2021 to meet ongoing running costs.

Mike Buck, CEO of Petro Matad, said:

"There is no doubt that 2020 was a challenging year due to the disruption triggered by the global health pandemic. Despite the difficulties, the Company worked hard throughout to progress the application for the Exploitation Licence for Block XX through a complex and lengthy process. We appreciate the patience that many of our shareholders have shown as we continue to work with the Mongolian Government to secure the requisite approvals. The formal application for award of the licence has now been submitted to the Ministry and we are working with the relevant departments as they process the necessary documentation."


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