Petro Matad Limited, the AIM-quoted Mongolian oil explorer, is pleased to announce its intention to conduct an accelerated bookbuild to raise gross proceeds of approximately US$18.3 million by way of a conditional placing of new Ordinary Shares in the Company with institutional investors and a subscription for new Ordinary Shares in the Company by certain directors and members of the senior management team of the Company.

Highlights

• Proposed placing of new Ordinary Shares (the "Placing Shares") and subscription for new Ordinary Shares (the "Subscription Shares") to raise net proceeds of approximately US$17.0 million (£12.7 million) at a price of 10 pence per New Ordinary Share (the "Placing Price") (the "Fundraising")
• The Company is undertaking the Fundraising to finance the drilling of additional two wells on its acreage in Mongolia, annual PSC licensing costs and for general working capital purposes
• On completion the Company will be fully funded to drill six wells in five risk independent basins, targeting c.850MMbo of prospective resources over the next 12 months 
• The additional wells will be drilled in 2019 and will follow this year's four well drilling campaign, which includes two wells on Block XX adjacent to the producing Block XIX and commences in July with the spudding of the 90MMbo Snow Leopard prospect in the Taats Basin in Block V, followed by the drilling of the Wild Horse prospect in the Baatsagaan Basin in Block IV, targeting 480MMbo

The additional high impact exploration wells: 

• Fox prospect - located in the Tugrug Basin in Block V, targeting 200MMbo of mean prospective resources. The prospect was high graded following the interpretation of data gathered by the Company's recent 3D seismic acquisition over Block V 
• Red Deer prospect - located in the Asgat Basin in the south west of Block XX, targeting 48MMbo of mean prospective resources. The prospect was identified following a review of existing 2D seismic and appears analogous to producing fields in the adjacent Block XIX to the north east

Update on current operations:

• Permitting and civil works for the Snow Leopard well are now complete. Sinopec, the rig operator, has commenced mobilisation of the rig to site and the Company expects to spud the well in July 2018
• The Company continues to make progress in its tendering process for a rig to drill the Block XX wells and will update the market shortly
• Following completion of the 3D seismic programme at the end of last year, the Company continued with its farm-out process, which commenced in 2017. This process has generated interest and a number of companies remain engaged, however there is no certainty that a deal will be completed. A further update will be provided as appropriate

Mike Buck, CEO of Petro Matad, commented:
"I am pleased to announce the launch of this accelerated bookbuild; our intention to raise further capital has been triggered by the identification of significant additional resource potential across our acreage position in Mongolia. Securing the funding to add two wells to our existing four well programme will allow us to negotiate extensions to rig contracts and to permit and prepare locations to enable us to spud the Fox and Red Deer prospects at the start of the drilling season in late Q1/early Q2 2019."