Mongolia-focused oil explorer Petro Matad Ltd (AIM: MATD) said it remains confident about the overall prospectivity for oil exploration of Block XX, and currently plans to drill up to three wells in the 2009 drill season.
There are a number of options available to Petro Matad and the board is in the process of evaluating the optimal means by which the wells may be funded.
Block XX is an inexpensive location for exploration drilling due to the shallow target depth of the wells, the nature of the regional topography and the ready availability of drilling equipment because of the proximity of large oil producing regions of China. The final drilling location of the wells has yet to be determined but in all likelihood all will be on the Davsan Tolgoi prospect.
The statements accompanied full-year results for the period ending December 31 2008. The group widened its pretax loss to US$6.3 million from US$4.4 million, mainly as a result of increased exploration and evaluation expenditure in the period.
“We are confident that the company will evolve in a positive manner in the next financial year,” it said, adding that: “overall economic conditions remain challenging, the effects of which will continue to have a significant bearing on the company's future.