Heron-1, results of drilling and wireline logging

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY PETRO MATAD LIMITED TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION (EU) NO. 596/2014 ("MAR"). ON THE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE ("RIS"), THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

9 September 2019

Petro Matad Limited

Heron-1, results of drilling and wireline logging

Petro Matad Limited ("Petro Matad" or "the Company"), the AIM quoted Mongolian oil explorer, provides the following update on the Heron-1 well in Block XX, eastern Mongolia.

Heron-1 has been drilled to a total depth of 2960 metres with the top Lower Tsagaantsav reservoir, the primary target for the well, encountered at 2803 metres, 5 metres shallower than the pre-drill prognosis. The formation drilled from 2803 to 2880 metres was predominantly sandstone interbedded with shales and siltstones. Oil and gas shows were recorded over this interval and on the basis of the drilling data, the gross reservoir interval in Heron-1 appears to be very similar to the productive reservoirs found in oil wells immediately to the north in Block XIX.

Wireline logs have been acquired and analysis of these data supports the interpretation of a 77 metre gross interval of potential oil reservoir. Within this interval the logs also define three zones with a total gross thickness of 22 metres (14 metres net) exhibiting better porosity and permeability characteristics than is generally seen within the Lower Tsagaantsav at this depth including in the nearby wells in the T19-46 oil field in Block XIX. Overall, the reservoir quality and oil saturations indicated on the wireline logs are sufficiently encouraging that casing will now be run in preparation for a testing programme.

The casing operation is now underway and discussions with the testing contractor have commenced to determine how quickly the testing equipment can be mobilised to the Heron-1 location. The contract requires 30 days notice to be given but the contractor has advised that an earlier start is possible depending on the status of its other activities. Once the well has been suspended DQE's drilling rig will move to the Gazelle location with a view to spudding Gazelle-1 before the end of September.

Mike Buck, the CEO of Petro Matad said:

"The results of the Heron-1 well are encouraging. Along with the well and wireline logging data being consistent with our pre-drill prognosis, there is also evidence of zones with better than expected porosity/permeability characteristics. The well will now be tested and we are pushing the contractor to mobilise equipment as quickly as possible. Further updates will be provided in due course."

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Technical information in this news release has been reviewed by the Company's Exploration Manager, Mr. Jerry Smart. He has 37 years of industry experience in oil and gas exploration and production with LASMO, Eni, Salamander Energy and Ophir Energy. He holds a B.Sc. in Geology from King's College, London.

About Petro Matad

Petro Matad is the parent company of a group focussed on oil exploration, as well as future development and production in Mongolia. At the current time, Petro Matad holds 100% working interest and the operatorship of three Production Sharing Contracts with the Government of Mongolia. Block XX has an area of 10,367 square kilometres in the far eastern part of the country, and Blocks IV and V have an area of 29,062 square kilometres and 21,143 square kilometres, respectively, in the central western part of the country.

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.