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Petro Matad Limited, an AIM-quoted Mongolian oil company, has issued an operational update highlighting recent advancements and ongoing projects in its portfolio.
Spudding of Heron-2 Development Well
Petro Matad has announced the spudding of the Heron-2 development well on September 8, 2024, located in the Tamsag Basin of eastern Mongolia. This marks the first development well on the Petro Matad-operated Heron Field, which has an estimated total oil in place potential of approximately 190 million barrels. The Heron Field was initially discovered with the Heron-1 well, drilled and tested in 2019.
Heron-2 is being drilled by the DQE International rig 40106, situated about 800 meters south of the original Heron discovery well. The well targets the same productive reservoir units of the Cretaceous Lower Tsagaantsav Formation proven in Heron-1. The Heron-1 well had an impressive maximum flow rate of 821 barrels of oil per day from a 12-meter interval between 2,834 meters and 2,846 meters, marking it as the third-best test rate ever recorded in Mongolia.
Heron-2 is planned to be drilled to a total depth of approximately 2,900 meters. The reservoir is expected to be encountered at a similar depth to that in Heron-1, based on high-quality 3D seismic data. Drilling to total depth is expected to take about 30 days, after which wireline logging will be performed to assess the reservoir’s productive potential. A well test and stimulation program is planned for the 2024 operational season, with potential production commencement in late 2024 or Q2 2025, depending on operational timelines and winter shutdowns.
Preparations for Gobi Bear-1 Well
Mobilization activities for the Gobi Bear-1 exploration well are underway, with the well expected to spud by mid-September. A detailed update on this will be provided in due course.
Heron-1 Production Facilities
Petro Matad is nearing the final stages of approval for the construction permit to install production facilities at Heron-1. The construction contractor is ready to mobilize once approval is granted. The permit process for Heron-2 is also progressing, and the Company has proposed a streamlined approval process to the Ministry of Construction to reduce bureaucratic delays for oil production well pad construction.
Negotiations and Logistics
Ongoing negotiations with PetroChina and the Mineral Resources and Petroleum Authority of Mongolia (MRPAM) are focused on processing, transporting, and selling Block XX production. Petro Matad has been invited by PetroChina to review logistical options at its Block XIX facilities.
