Petro Matad (PRTDF)

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Petro Matad Delays Drilling Plans to Review New Data -- Update

Today : Wednesday 3 February 2016
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By Ian Walker


LONDON--Shares of Petro Matad Ltd. (MATD.LN) fell as much as 28% in early trade Wednesday, leading the FTSE Aim All Share index fallers, after the Mongolian exploration firm said it will delay drilling plans to 2017.

The company said it will drill two exploration wells in 2017, rather than drill one in each of the years 2016 and 2017, as it suspended a program to gather and record seismic data on Block V in Central Mongolia until May.

The company said although the winter break in the seismic program has caused some delay, the more important factor in the decision to delay exploration drilling until 2017 is the need to review substantial amounts of new data. It added that drilling two exploration wells back to back will result in operational and financial efficiencies.

"...it is prudent to take the extra time to ensure the best prospects are matured for drilling in 2017," the company said. Drilling the two exploration wells in 2017 will also result in operational and financial efficiencies, it added.

Shares at 1215 GMT were down 0.87 pence, or 28%, at 2.25 pence. They are currently down 36% over the past 12 months.

The company added that it hasn't experienced any detrimental impact on its operations from the fall in oil price, which has affected the oil and gas industry. Brent crude has fallen 39% over the past 12 months and is currently trading around $33.31 a barrel, while crude oil is down 38% at $30.47 a barrel