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Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

Proselenes
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Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#151714

Postby Proselenes » July 11th, 2018, 11:08 am

EPIC : MATD

Company Web site : http://www.petromatadgroup.com/

Petro Matad is a group focused on oil exploration, as well as potential future development and production in Mongolia. The Group’s assets consist of Production Sharing Contracts (PSCs) over the following exploration blocks:

Matad Block XX, with an area of 10,340km2 in the far eastern part of Mongolia near the Chinese border

Bogd Block IV and Ongi Block V, adjacent to each other in west central Mongolia totalling approximately 50,000km2


Edison Research Note July 2018 : https://nofile.io/f/j90GYESdoet/MATD.pdf

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#151715

Postby Proselenes » July 11th, 2018, 11:10 am

Taken a position in this one around the 9p level.

They are fully funded for 6 wells............4 in 2018 and 2 in 2019 (split by the non-drilling winter when drilling cannot be done).

First well Snow Leopard has already spudded and will take around 50 to 70 days with a number of targets.

The second well is the big one..........Wild Horse, which will spud when the first well is complete. Its been rated by Wood Mackenzie as 1 of the top 20 wildcats to watch in 2018. Rather large and if successful would amount to a blue sky share price.


In the recent placing at 10p (to add the 2 drills in in 2019 on top of the 4 this year) the Directors purchased around 250K US$ of stock........so they have plenty of skin in the game........which is a bonus.

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#151717

Postby Proselenes » July 11th, 2018, 11:18 am

Interview with the MATD CEO was also uploaded yesterday on You Tube. Link below :

https://www.youtube.com/watch?time_cont ... a79wR0_jS0

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#152157

Postby Proselenes » July 13th, 2018, 11:55 am

Earlier March 2018 Oil Capital Conference presentation video : https://www.youtube.com/watch?v=oL9rbvLAjn4

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#160279

Postby Proselenes » August 17th, 2018, 11:52 am

Abnormally high volume today and a 16% rise.

Nothing to get excited about as the only thing that matters is the RNS when it comes and drill results......good or bad.

The next well to be drilled (straight after this one) is the big one, albeit this one is still big in itself for MATD. NPV10's of the first three wells as massive, if they strike oil.

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#160403

Postby Proselenes » August 18th, 2018, 6:41 am

I made up the below.

If drilling is 70 days as per the RNS then they just poked the upside yesterday (day 39 of 70).

If drilling is 50 days as per the past presentations then they just poked the main target yesterday.

Either way day 39 was a key day on either a 50 or 70 day schedule.

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#161194

Postby Proselenes » August 22nd, 2018, 11:05 am

Some references to Blocks IV and V in the below article.

HTTPS://www.geoexpro.com/articles/2015/01/mongolia-potential-in-an-emerging-economy

Its why BG were so interested in Blocks IV and V and farmed in. Although these are Wildcat wells in Blocks IV and V with Snow Leopard and Wild Horse.........they are Basin Opening Plays.

If they strike oil, it means big big upside in the other targets and prospects in the blocks - and potential, as it says on the tin........Basin Opening.

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#162051

Postby Proselenes » August 25th, 2018, 2:53 pm

Worth a listen.

Mike Buck talking in July.

HTTP://www.petromatadgroup.com/wp-content/uploads/2018/08/SM20180710-presentation.mp3

Super Majors waiting in the wings if they strike oil :)

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#162188

Postby IronPyrites » August 26th, 2018, 2:35 pm

Hi Proselenes

Thanks for the updates on this one. I have been watching from the sidelines but at the end of last week I dipped my toe in at 8.85p.
Mongolia certainly has potential particularly if you look at the surrounding Chinese discoveries – there is definitely going to be oil found somewhere and hopefully by Petro Matad :-)

Petro Matad drilling 6 funded wells in the next few months and the share price being at a discount to the level at which monies were recently raised makes it an interesting gamble.

I say gamble because CoS varies and for the first two wells is around 10-15%. So there is likely to be significant share price fluctuations.
Initial failure is far more likely than success and so I was tempted to wait for the results of Snow Leopard and then invest for Wild Horse (large potential) followed by Gazelle (better CoS).
In the end I decided to put something in for Snow Leopard but wait until after the results before investing fully.
News isn’t expected until the drilling and testing is completed (probably another couple of weeks plus) so it will be interesting to see if the share price rises on expectation but my head tells me that the chances are I will be able to buy in sub 8p at that point.

Regards
Iron

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#162666

Postby Proselenes » August 28th, 2018, 5:05 pm

Hi Iron,

The potential is significant. We are talking over 20 billion barrels potential in Blocks IV and V.

The thing that gives me hope with Snow Leopard is the one day where volume spiked to 20 million, which was day 39 of drilling and when they would have been in the potential upside zone.

No reason for any volume spike that day, so its rather strange for a big volume spike and price rise.

Volume is now back to normal, pretty much below 6 million everyday, so no leaks either way at the moment, hope they can keep it a tight hole from now until when the news is released officially.

There will be a lot of people buying in for Wild Horse-1, which should lessen the drop for a Snow Leopard duster, or make the rise even bigger on any success.

If Snow Leopard strikes it derisks between 500 to 700 million barrels in the area just surrounding Snow Leopard, so the upside could be very significant.

Good luck.

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#162667

Postby Proselenes » August 28th, 2018, 5:06 pm

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#164810

Postby Proselenes » September 7th, 2018, 7:13 am

Half year results out.

HTTPS://www.investegate.co.uk/petro-mat ... 00020584A/

All good, SL-1 ongoing.

I suspected that the Technical Permit (you need a drilling permit and a technical permit) was the problem for Block XX and they say regulatory problem caused the delay. Anyway, more time to assess seismic and then 3 wells back to back April onwards.

WH-1, the big one, on track after SL-1 completes.

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#166172

Postby Proselenes » September 13th, 2018, 8:54 pm

Bit of a comment from Malcy at 22:55 into the audio :

HTTPS://www.voxmarkets.co.uk/articles/a ... d--a0e223b


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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#167725

Postby Proselenes » September 20th, 2018, 4:32 pm


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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#167854

Postby IronPyrites » September 21st, 2018, 8:46 am

Hi Pro

The outcome of this drill was not a great surprise to me and I have taken the opportunity to average down to 7.3p.
The interesting and exciting aspects of this campaign is that it is a series of six (now 5) fully funded wells in different basins in a part of the world little explored but close to geology that has produced significant oil for China.
The riskier wells are being drilled first. SL had a CoS of 15% and WH is similar (though with much greater potential).
SP movement in small exploration companies tends to be very volatile on any news, often dropping significantly on bad news and then slowly retracing as key events approach.
AAOG is a great example of where unexpected negative news (drilling site needs to be moved by 100m as site unstable) is taken as a disaster by the market but in reality is little more than a short delay in operations with no change in the CoS.

I am certain that the SP for MATD will retrace as we approach the results of the drill. It is again likely to be a failure so I may consider taking some money off the table at that point leaving a smaller amount on the unlikely success of the well. There will then IMO be an opportunity to reinvest after the winter in the company at a much lower SP, prior to the four remaining drills which have a greater CoS than the first two.

Many thanks for your continuing updates both here and elsewhere.

Regards
Iron

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#168071

Postby Proselenes » September 22nd, 2018, 6:48 am

Hi Iron, my thoughts "in hindsight" are below..........WH-1 is high risk again, we may not see oil until Fox-1, but if WH-1 does come in, then well......blue sky.


If you put your hindsight goggles on and go backwards now based on what is now known :

The plan was to drill Wild Horse-1 first, then Falcon-1 (as of early 2018 presentations).

Wild Horse-1 (Block IV) has only just(during SL-1 drilling it seems) received its final permits (chemical use) and so could not have been drilled until now anyway.

Falcon-1 (Block V) the 2nd planned well earlier this year was downgraded based on new 3D and removed.

Snow Leopard-1 (Block V) was the only drill ready prospect and which was the first to get all permits in place. MATD are also short of the required spend level of the license of Block V. It was rushed in as the replacement for Falcon-1

I would imagine Mike and his team were between a rock and a hard place here. Fox-1 the new exciting prospect from the new 3D is not drill ready and not permitted, permitting ongoing. Wild Horse-1 which was always your first drill, is not ready as final permits (chemical use etc..) are not in place. Falcon-1 which was your 2nd drill in the schedule is suddenly not worth drilling (too small) compared for Fox-1 so cannot be moved to be 1st.

You either cancel your 2018 drilling schedule (going down like a lead balloon)to allow Wild Horse-1 and Fox-1 back to back in 2019 or you put Snow Leopard-1 into play and drill that while you try to get the final permits for Wild Horse-1 to allow a seamless move from SL-1 to WH-1 in 2018 and go to the local temple to pray you get the Wild Horse-1 final permits before SL-1 finishes drilling.

If I go back now - with knowledge today - you really can see why the 2nd fund raise happened and why it was at 10p (compared to the earlier one at 6.5p - thats all down to Fox-1).

Looking at the prospects - Wild Horse-1 has simple faulting, its a 4 way dip (dome) and has soft amplitude anomalies. Pretty good target. Always was the 1st one they wanted to drill.

Snow Leopard-1 has complex faulting and therefore high sealing risk. In all the presentations after removing Falcon-1 there is nothing much exciting said about SL-1. Look yourselves....its as if someone writes the slide saying, yeah, we got this one too.

Fox-1 - extremely exciting, they spend 4 pages of their latest presentation detailing Fox-1. 3 way dip, normal faulting, bright spot on 3D, live oil shows in coring etc.. etc.. etc...

I feel the only reason they drilled SL-1 was to actually put the 2018 drilling into play and to bide time to get the WH-1 permits complete so they could drill WH-1, whilst also ensuring the spend on Block V was up to the level needed so as not to have any issues with Fox-1 which is also in Block V. And yes, in hindsight now I would say SL-1 was a strati-graphic test well in effect, one which also raised the spend level on Block V to the level required for compliance with the license. It had a (very limited) chance to strike oil and didn't and no surprise there.

Had I known prior that WH-1 was still waiting for final permits I might have put two and two together prior to events, but I didnt, and anyway, its far easier in hindsight, everyone is an expert after the event, as always :)

I dont blame Mike and his team for doing it this way if that is what happened, it makes sense in hindsight, just you started drilling with perhaps what was "off record internally" your worst prospect.

So in summary, my view, SL-1 was just a license spend compliance, waiting for WH-1 final permits, mobilize the rig and get in in the area ready for WH-1, fill in for the downgraded Falcon-1, in effect strati-graphic test well. And in view of that - I really cannot see them not spudding Wild Horse-1 asap, its a must and IMO, it WILL happen very soon.

All IMO, just my thoughts.

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#168504

Postby Proselenes » September 24th, 2018, 6:57 am

To put things into perspective.

Cormorant-1 (announced today as a duster) which was the big talked about well for TLW, PCL, ONGC was targeting only 124 million barrels recoverable, with follow on prospects for 790 million barrels. This of course being split between the 4 parties involved with the most going to Tullow who had 35%.

Now, Wild Horse-1 is 100% owned by Petro Matad.

It is targeting 480 million barrels recoverable (100% owned by MATD) with follow on prospects of 750 million barrels (100% owned by MATD)

Its way bigger than Cormorant-1..........

That is the reason why Royal Dutch Shell having been talking with MATD and are keenly waiting for the result of Wild Horse-1 - because if it strikes oil then its pretty bolted on that Shell will be looking to farm in to Block IV and Block V given the potential of over 20 billion barrels recoverable in the 2 blocks. Thats why MATD is exciting.

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#168526

Postby Proselenes » September 24th, 2018, 9:46 am

I believe Wild Horse-1 is going to be spudded asap. They want it done before winter. They want the winter to be able to go to Shell and others and see who is willing to pay the most to farm in, in the event of an oil strike at Wild Horse-1.

Shell are in lead position (we know they cut Mongolia after they purchased BG, simply as they are not interested in Wild Cat wells in a new country, they are very interested in Oil discoveries in a new country - hence they told MATD they want to see Wild Horse 1 drilled and are willing to farm in and pay a lot more money AFTER a discovery). I say they are in lead position as they left in the contract that MATD have to pay Shell 5m US$ if they farm out Blocks IV/V to anyone other than Shell in future.

If, and its an big if, but if they strike oil at Wild Horse-1 then they have the winter to do a farm in deal with Shell or another.

Interestingly, if you look at the confidence levels "internally"......... Snow Leopard was never planned in advance for appraisal. Wild Horse-2, an appraisal well for Wild Horse, is already planned and permitted. So why are they planning ahead already to appraise Wild Horse...........they must have high confidence. I imagine the internal CoS for Wild Horse-1 is much higher than the advertised CoS.

Also the rig will be winterised and left over winter at Wild Horse location......... this means if they strike oil at WH-1 they can in effect, if they want, delay Block XX drilling even more and do a straight appraisal with Wild Horse-2 in April......as its already permitted. They can then move to Fox-1 to drill that after WH-2.

And if Wild Horse-1 strikes oil I imagine that is what they will tell Shell and others........... Do you want to farm in now for XXX million, or you want us to appraise Wild Horse and drill Fox-1 and you farm in for XXXX million later.

This is what makes MATD so very interesting over the winter if they strike at Wild Horse-1. A strike at Wild Horse-1 is going to rocket the price for sure..... 480MMBO recoverable and then other prospects derisked for 750MMBO recoverable - all 100% owned. But those who then sell the initial stike will perhaps miss the potential bigger rise, which will be when/if a Super Major farms in over winter.......... A farm in over winter and new funds and free carries could see a number of wells sunk into Blocks IV and V, so the farm in potential company will not want to wait for MATD to appraise and discover more oil and also will not want to waste time in the 2019 drilling season, so the potential for a winter period farm in is high.............IF they strike oil at Wild Horse-1.

All very interesting.

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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#169991

Postby Proselenes » September 29th, 2018, 5:59 am

My estimated locations of SL-1 and WH-1 and the distance (bird flies and by road). Bayansair (Bayansayr) is the nearest town.


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Re: Petro Matad - Fully funded 6 well campaign for H2 2018/H1 2019

#169992

Postby Proselenes » September 29th, 2018, 6:15 am

Bayansair (Bayansayr) is the nearest town. Daytime temperatures (they only drill daytime) are forecast to be above zero until mid-November.

https://www.accuweather.com/en/mn/bayan ... =10/1/2018

October quite warm daytime.

November slipping to a negative daytime temperature from the 19th November onwards. Cold snap starting 18th November evening. Working back 30 days from then........... the latest date spud should be (for completion and logging in 2018) should be around 20th October. So as we stand now.

Prep work on WH-1 location began in August. Everything possible done in advance for seamless move.
SL-1 finished P&A on Friday 21st Sept.
Move and rig up has been ongoing to 8 days as of today.
22 days remain to get spud done by latest 20th October
Hopefully spud between 8th and 15th October.


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