Petro Matad Ltd (LON:MATD) has kicked off a hotly anticipated exploration drilling campaign in Mongolia.
The explorer, in a stock market statement, told investors that it has now spudded its wholly-owned Snow Leopard 1 well, in the Taats basin, which is part of the Block V asset.
Snow Leopard is targeting a 90mln barrel prospect. The well will be drilled down to a depth of 3,350 metres and it is expected to take up to 70 days to complete.
A separate well would be needed, if the exploration well is a success.
It is the first of four planned exploration wells, which will together test prospects with an estimated 600mln barrels of possible oil.
No small measure of relief
In a note to clients, analysts at ‘house’ broker SPAngel commented: “Today’s announcement that snow leopard has commenced drilling marks the end of the initial phase of a longer journey which started 10 years ago.
“While there have been a number of headwinds, not least the withdrawal of Shell from the drilling JV, that the bit is turning is a testament to management’s belief in the prospectivity. Now that drilling has started, the technical work is being put to the test.
“We believe there will be no small measure of relief for the company investors that it has gotten to this stage, and we, like so many, will be keenly awaiting the news.”
In late morning trading, Petro Matad shares were 3.9% lower at 9.85p.
-- Adds share price, analyst comment --