REG - Petro Matad Ltd - Interim results for six months ended 30 June 2025
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RNS Number : 1082B Petro Matad Limited 29 September 2025
Petro Matad Limited
('Petro Matad' or the 'Company' or the 'Group')
Interim results for the six months ended 30 June 2025
LONDON, 29 September 2025: Petro Matad Limited, the AIM quoted Mongolian oil
company, is pleased to announce its unaudited interim results for the six
months ended 30 June 2025 ("1H 2025").
Financial Highlights
· Petro Matad's cash balance at 30 June 2025 was USD 2.37 million (USD
1.7 million in cash and USD 0.67 million in Financial Assets), comparing to
USD 1.93 million (USD 0.77 million in cash and USD 1.16 million in Financial
Assets) on 30 June 2024.
· The Group posted a loss of USD 1.7 million for the 6-month period
ended 30 June 2025, which compares to a loss of USD 2.56 million for the
comparable period in 2024.
Operational Highlights
· Production began from Heron-1 well in October 2024, with Petro Matad
receiving the first oil revenues in its history, with average production for
1H 2025 of 165 barrels of oil per day (bopd) and a 3% water cut.
· An oil sales agreement was negotiated with Block XIX operator,
PetroChina, and signed in late April 2025 after which sales revenue payments
began in mid-June 2025. After delays and continued pressure from Petro Matad,
PetroChina has now advised that they will begin payment of 100% of the
invoiced payments once the oil sales agreement has been amended. This
amendment is now being prepared.
· During 1H 2025, Petro Matad re-vitalised farm-in partner discussions
for Block XX and the Company has now reached the stage of detailed technical
and commercial negotiations with one party.
· The Company also signed a new Exploration and Production Sharing
Contract (PSC) for Block VII and expanded its renewable energy initiative,
signing an exclusive agreement to develop a 200MW hybrid wind and solar
project.
Financial Summary 1H 2025
Petro Matad began production from the Heron-1 well in Block XX, eastern
Mongolia, in October 2024. During the first half of 2025 production averaged
165bopd and the Company received the first oil revenues in its history. Net
revenue that Petro Matad received during the reporting period for production
from start up to the end of April 2025 was USD 0.81MM with an average realised
oil price of USD 62.9 per barrel (bbl). As announced previously, 30% of total
sales revenue was withheld by PetroChina pending confirmation that there would
be no tax impact on them resulting from the oil sales agreement signed between
Petro Matad and PetroChina. Post the reporting period, payment for 70% of the
invoiced amounts was received in August for production in the months of May
and June, and in September for July's production totaling USD 0.33MM net to
Petro Matad. The realised oil price for May was USD 60.7/bbl, USD 65.2/bbl for
June and USD 64.4/bbl for July.
The Group posted a loss of USD 1.70 million for 1H 2025, which compares to a
loss of USD 2.56 million for the comparable period in 2024. The Company's cash
balance at 30 June 2025 was USD 2.37 million (USD 1.70 million in cash and USD
0.67 million in Financial Assets), which compares to a cash balance of USD
1.93 million (USD 0.77 million in cash and USD 1.16 million in Financial
Assets) on 30 June 2024.
As previously announced, the Company raised gross proceeds of GBP 3 million
(c. USD 4.2 million) through the Placing of 323,250,000 new Ordinary
Shares, Subscriptions for 32,169,117 new Ordinary Shares by each of a
director and shareholder of the Company, and completion of a Retail Offer
totaling 19,497,678 Ordinary Shares. All shares were issued at a price of 0.8
pence. The net proceeds of the capital raising will primarily be used to
reduce oil production operating expenditure at Heron-1 through a switch from
diesel fired power to lower cost grid electricity, to investigate the
potential to increase Block XX production in 2025 by re-testing the Heron-2
well, testing of the Gazelle-1 oil discovery and of the Gobi-Bear 1
exploration well, the development of renewable energy projects, and to work-up
exploration opportunities in Block VII.
Operational Summary 1H 2025 and look ahead
Having resolved the longstanding land issue that had delayed production start
up on the Heron oil discovery in Block XX in eastern Mongolia, production
start up was finally achieved in October 2024 with oil being transported to
the neighbouring TA-1 facilities in Block XIX for processing, storage and
export to China. After an initial period of natural flow from Heron-1 of in
excess of 200 bopd, the well was put on artificial lift and the pumped
production stabilised in the range of 150 to 160 bopd.
An oil sales agreement was negotiated with Block XIX operator, PetroChina, and
finally signed in late April 2025 after which sales revenue payments began in
mid June 2025 with the receipt of proceeds for production from the start up to
the end of April 2025. Payments were subject to PetroChina's 30% withholding.
Post the reporting period, payments were received for the months of May, June
and July with the withholding still applied. In September Petro Matad provided
PetroChina with feedback received from the Mongolian tax authorities and
further comfort that there were no tax implications from the oil sales
agreement. PetroChina has now advised that they will begin payment of 100% of
the invoiced amounts once the oil sales agreement has been amended to
incorporate wording on the comfort the Company has provided. This amendment is
now being prepared.
During 1H 2025 the Company announced a re-vitalised initiative to find a
farm-in partner for Block XX and has been in discussion with several potential
counterparties. The interaction with one of these companies has reached the
stage of detailed technical and commercial negotiations.
In January 2025 the Company announced the signing of a new Exploration and
Production Sharing Contract (PSC) for Block VII in the southern central part
of Mongolia. This large block is adjacent to producing fields across the
border in China and was signed for a very low initial financial commitment to
ensure that the exploration dollars spent here will be based on the results of
technical evaluation rather than being an upfront financial obligation. The
Company is actively engaged in a farmout process for Block VII seeking a
technically and financially competent partner to share the risk and reward on
this exciting new area.
The Company's renewable energy initiative conducted by its Sunsteppe Renewable
Energy Joint Venture continued to expand its portfolio and signed an exclusive
agreement to develop a 200MW hybrid wind and solar project to supply the
Mongolian national grid.
Looking ahead to the second half of 2025, after the successful equity raise in
July, the Company has embarked on a low cost well testing programme in Block
XX seeking to add production in the near term. A re-test of the Heron-2 well
following acidisation of the reservoir to improve near well bore permeability
is ongoing. The small workover rig has now moved to perform a well test on the
oil zones interpreted from logs to be present in the Gazelle-1 well and this
will be followed by a test of the Gobi Bear-1 exploration well which has a
zone of interest identified on logs and supported by extraction of migrated
oil from drill cuttings. In addition, the Heron-1 well site is being connected
to the national electricity grid. The provincial power station has recently
been upgraded and, by means of a short transmission line extension, can now
supply Block XX with lower cost electricity to replace the more expensive
diesel fired power currently in use. A 15% reduction in operating expense is
targeted from this project.
Some of the proceeds of the mid-year equity raise are directed at development
of Sunsteppe's new 200MW Hybrid project as, with a power purchase agreement
already in place and only in need of amendment, this project could be brought
to ready-to-build status rapidly. Work is also planned to start on land
acquisition and data gathering for Sunsteppe's 1.5GW firm (plus 1.5GW
contingent) project in cooperation with the large Chinese utility company
SPIC. Sunsteppe is also engaged in discussions with other companies looking at
entering and investing in the renewable energy sector in Mongolia.
Mike Buck, CEO of Petro Matad, said:
"The start up of production in Block XX in 2024 took far too long but we are
delighted to have finally achieved it and now to be receiving oil sales
revenue for the first time in the Company's history. Over the last few months
we have prioritised our efforts to remove PetroChina's withholding of 30% of
our sales revenue and after the recent meeting with PetroChina we are hopeful
that this matter will soon be resolved.
In the field we are working hard to complete our 2025 well test programme and
at the same time, our renewables joint venture is growing into a potentially
very valuable part of our business.
I would like to thank the entire Petro Matad and Sunsteppe teams for their
continued efforts. We are particularly pleased to see our oil production crew
working so well at Heron-1. All members of the team are Mongolian and most
were hired from the communities in the area of our operations."
- Ends -
Further information please contact:
Petro Matad Limited
Mike Buck, CEO +976 7014 1099 / +976 7575 1099
Shore Capital (Nominated Adviser and Broker)
Toby Gibbs +44 (0) 20 7408 4090
Harry Davies-Ball
Zeus (Joint Broker) +44 (0) 20 3829 5000
Simon Johnson
Louisa Waddell
FTI Consulting (Communications Advisory Firm)
Ben Brewerton +44 (0) 20 3727 1000
Christopher Laing
About Petro Matad
Petro Matad is the parent company of a group focused on oil exploration,
development and production in Mongolia. Currently, Petro Matad holds a 100%
working interest and the operatorship of the Matad Block XX Production Sharing
Contract with the government of Mongolia. Block XX has an area of 214 square
kilometres in the far eastern part of the country. The Company also holds a
100% working interest and operatorship of the Borzon Block VII Production
Sharing Contract with an area of 41,141 square kilometres in southern central
Mongolia.
Petro Matad Limited is incorporated in the Isle of Man under company number
1483V. Its registered office is at Victory House, Prospect Hill, Douglas, Isle
of Man, IM1 1EQ.
STATEMENT OF COMPREHENSIVE INCOME
FOR THE HALF-YEAR ENDED 30 JUNE 2025
Consolidated
30 Jun 2025 30 Jun 2024
$'000 $'000
Continuing Operations
Revenue
Operating income 1,403 -
Cost of goods sold (384) -
1,019 -
Interest income 17 102
Other income - -
17 102
Expenditure
Consultancy fees (69) (65)
Depreciation and amortisation (649) (105)
Employee benefits expenses (726) (869)
Exploration, exploitation and evaluation expenditure (84) (1)
Other expenses (1,178) (1,626)
Profit/(Loss) from continuing operations before income tax (1,670) (2,564)
Income tax expense - -
Profit/(Loss) from continuing operations after income tax (1,670) (2,564)
Net Loss (1,670) (2,564)
Other comprehensive income/(loss)
Exchange rate differences on translating foreign operations (30) 13
Other comprehensive income/(loss), net of income tax (30) 13
Total comprehensive loss (1,700) (2,551)
Profit/(Loss) attributable to owners of the parent (1,700) (2,564)
Total comprehensive income/(loss) attributable to owners of the parent (1,700) (2,551)
Earnings/(loss) per share (cents per share)
- Basic and diluted earnings/(loss) per share (0.11) (0.23)
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2025
Consolidated
30 Jun 2025 31 Dec 2024 30 Jun 2024
$'000 $'000 $'000
ASSETS
Current Assets
Cash and cash equivalents 1,702 1,987 772
Trade and other receivables 991 698 344
Prepayments 149 123 143
Financial assets 670 968 1,160
Inventory 216 223 217
Total Current Assets 3,728 3,999 2,636
Non-Current Assets
Exploration and evaluation 14,661 15,084 15,275
Investment in SunSteppe 483 663 793
Property, plant and equipment 442 510 222
Right-of-Use asset 42 103 43
Petroleum asset 393 503 -
Total Non-Current assets 16,021 16,863 16,333
TOTAL ASSETS 19,749 20,862 18,969
LIABILITIES
Current liabilities
Trade and other payables 1,567 961 263
Lease liability 38 109 -
Total Current Liabilities 1,605 1,070 263
Non-Current Liabilities
Decommissioning provision 563 562 -
Total Non-Current Liabilities 563 562 -
TOTAL LIABILITIES 2,168 1,632 263
NET ASSETS 17,581 19,230 18,706
EQUITY
Issued capital 169,009 169,009 160,176
Reserves 469 448 405
Accumulated losses (151,897) (150,227) (141,875)
TOTAL EQUITY 17,581 19,230 18,706
CONDENSED CASH FLOW STATEMENT
FOR THE HALF-YEAR ENDED 30 JUNE 2025
Consolidated
30 Jun 2025 30 Jun 2024
$'000 $'000
Cash flows from operating activities
Payments to suppliers and employees (1,892) (2,339)
Oil sale revenue 1,177 -
Interest received 17 102
Net cash flows from/ (used in) operating activities (698) (2,237)
Cash flows from investing activities
Purchase of property, plant and equipment (16) (10)
Proceeds from sale of financial assets 298 2,369
Investment in SunSteppe 180 153
Net cash flows from/ (used in) investing activities 462 2,512
Cash flows from financing activities
Proceeds from issue of shares - -
Capital raising costs - -
Payments of lease liability principal (19) (19)
Net cash flows from/ (used in) financing activities (19) (19)
Net increase/(decrease) in cash and cash equivalents (255) 256
Cash and cash equivalents at beginning of period 1,987 503
Net foreign exchange differences (30) 13
Cash and cash equivalents at end of period 1,702 772
STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEAR ENDED 30 JUNE 2025
Consolidated
Attributable to equity holders of the parent
Issued Capital Accumulated Losses Other
$'000 $'000 Reserves $'000 Total
$'000
As at 1 January 2024 160,176 (139,364) 243 21,055
Income/(Loss) for the period - (2,564) - (2,564)
Other comprehensive income - - 13 13
Total comprehensive income/(loss) for the period 160,176 (141,928) 256 18,504
Transactions with owners in their capacity as owners
Issue of share capital - - - -
Cost of capital raising - - - -
Transfer of Petro Matad Singapore - 53 - 53
Share based payments - - 149 149
As at 30 June 2024 160,176 (141,875) 405 18,706
As at 1 January 2025 169,009 (150,227) 448 19,230
Income/(Loss) for the period - (1,670) - (1,670)
Other comprehensive income - - (30) (30)
Total comprehensive income/(loss) for the period 169,009 (151,897) 417 17,530
Transactions with owners in their capacity as owners
Issue of share capital - - - -
Cost of capital raising - - - -
Share based payments - - 51 51
As at 30 June 2025 169,009 (151,897) 469 17,581
1. CORPORATE INFORMATION
The financial report covers the consolidated entity of Petro Matad Limited and
its controlled entities.
Petro Matad Limited (Company) incorporated in the Isle of Man on 30 August
2007 has six wholly owned subsidiaries, which are: Capcorp Mongolia LLC, Petro
Matad LLC and Petro Matad Energy LLC (incorporated in Mongolia), Central Asian
Petroleum Corporation Limited (Capcorp) and Petromatad Invest Limited (both
incorporated in the Cayman Islands), and Petro Matad Energy Limited
(incorporated in Isle of Man). Petro Matad Limited owns 50% of Sunsteppe
Renewable Energy Pte. Ltd. (formerly known as Petro Matad Singapore Pte.
Ltd.), which is incorporated in Singapore, which is owned jointly together
with Sunsteppe Energy LLC to pursue renewables energy projects. The Company
and its subsidiaries are collectively referred to as the "Group". The Group's
principal activity in the course of the financial year consisted of oil
exploration and development and investment in renewable projects in Mongolia.
Petro Matad Limited trades on the Alternative Investment Market (AIM), which
is a sub-market of the London Stock Exchange, under the symbol MATD. Its major
shareholder is Petrovis Matad Inc.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The half-year financial report does not include all of the notes of the type
normally included within the annual financial report and therefore cannot be
expected to provide as a full understanding of the financial performance,
financial position and financing and investing activities of the consolidated
entity as full financial report.
The half-year financial report should be read in conjunction with the annual
Financial Report of Petro Matad Limited as at 31 December 2024. The half-year
consolidated financial statements have been prepared using the same accounting
policies as used in the annual financial statements for the year ended 31
December 2024.
It is also recommended that the half-year financial report is considered
together with any public announcements made by Petro Matad Limited and its
controlled entities during the half-year ended 30 June 2025.
(a) Basis of Preparation
The half-year consolidated financial report is a general purpose financial
report, which has been prepared in accordance with the requirements of
International Financial Reporting Standards ("IFRS") as issued by the
International Accounting Standards Board ('IASB'). The half-year financial
report has been prepared on a historical cost basis, except where stated.
The financial report is presented in US dollars, and all values are rounded to
the nearest thousand dollars ($'000).
For the purpose of preparing the half-year financial report, the half-year has
been treated as a discrete reporting period.
(b) Basis of consolidation
The consolidated financial statements comprise the financial statements of the
Group for the half-year period ended 30 June each year.
Subsidiaries are entities controlled by the Group. Control exists when the
Group has the power to govern the financial and operating policies of an
entity so as to obtain benefits from its activities. In assessing control,
potential voting rights that presently are exercisable or convertible are
taken into account. The financial statements of the subsidiaries are
included in the consolidated financial statements from the date that control
commences until the date that control ceases.
The financial statements of subsidiaries are prepared for the same reporting
period as the parent company, using consistent accounting policies.
Adjustments are made to bring into line any dissimilar accounting policies
that may exist.
A change in the ownership interest of a subsidiary that does not result in a
loss of control is accounted for as an equity transaction.
All intercompany balances and transactions, including unrealised profits
arising from intra-group transactions, have been eliminated in full.
Unrealised losses are eliminated unless costs cannot be recovered.
3. CONTRIBUTED EQUITY
CONSOLIDATED
30 Jun 2025 31 Dec 2024
$'000 $'000
Ordinary shares (i) 169,009 169,009
1,483,883,601 shares issued and fully paid.
(31 Dec 2024: 1,483,883,601)
169,009 169,009
(i) Ordinary shares
Full paid ordinary shares carry one vote per share and carry the right to
dividends.
Movement in ordinary shares on issue Number of Shares Issue Price$ $'000
At 1 January 2025 1,483,883,601 169,009
No transactions during the period - - -
At 30 June 2025 1,483,883,601 169,009
4. RESERVES
A detailed breakdown of the reserves of the Group is as follows:
Equity benefits reserve Foreign currency translation Total
Merger reserve
Consolidated $'000 $'000 $'000 $'000
As at 30 June 2024 831 903 (1,329) 405
Currency translation differences - - (11) (11)
Expiry of Options - - - -
Share based payments - 54 - 54
As at 31 December 2024 831 957 (1,340) 448
Currency translation differences - - (30) (30)
Share based payments - 51 - 51
As at 30 June 2025 831 1,008 (1,370) 469
5. EARNINGS/(LOSS) PER SHARE
The following reflects the income and share data used in the total operations
basic and diluted earnings/(loss) per share computations:
CONSOLIDATED
30 June 30 June
2025 2024
Basic earnings/(loss) per share
Total basic earnings/(loss) per share (US$ cents per share) (note a) (0.11) (0.23)
Diluted earnings/(loss) per share
Total diluted earnings/(loss) per share (US$ cents per share) (note b) (0.11) (0.23)
(a) Basic earnings/(loss) per share
The profit/(loss) and weighted average number of ordinary shares used in the
calculation of basic loss per share are as follows:
Net profit/(loss) attributable to ordinary shareholders (US$'000) (1,670) (2,564)
Weighted average number of ordinary shares for the purposes of basic earnings 1,483,884 1,113,884
per share ('000)
(b) Diluted earnings/(loss) per share
The profit/(loss) and weighted average number of ordinary shares used in the
calculation of diluted earnings per share are as follows:
Net profit/(loss) attributable to ordinary shareholders (US$'000) (1,670) (2,564)
Weighted average number of ordinary shares for the purposes of basic earnings 1,483,884 1,113,884
per share ('000)
Share Options and Conditional Share Awards could potentially dilute basic loss
per share in the future, however they have been excluded from the calculation
of diluted loss per share because they are anti-dilutive for both years
presented.
6. EVENTS AFTER THE REPORTING DATE
On 18 July 2025, the Company concluded a placing by issuing 323,250,000 shares
at a price of GBP0.008 per share arranged through Shore Capital Stockbrokers
and Zeus Capital.
On 18 July 2025, the Company issued 32,169,117 shares through direct
subscriptions at a price of GBP0.008 per share.
On 18 July 2025, the Company issued 19,497,678 shares to shareholders at a
price of GBP0.008 per share through a retail offering.
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