REG - Petro Matad Ltd - Production Revenue Received

Petro MatadAnnouncement

18/06/2025 07:02

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RNS Number : 2691N  Petro Matad Limited  18 June 2025

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY PETRO MATAD
LIMITED TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE UK VERSION OF
THE MARKET ABUSE REGULATION (EU) NO. 596/2014 AS IT FORMS PART OF UNITED
KINGDOM DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018
("UK MAR"). ON THE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY
INFORMATION SERVICE ("RIS"), THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE
IN THE PUBLIC DOMAIN.

Petro Matad Limited

('Petro Matad' or the 'Company' or the 'Group')

Production Revenue Received

LONDON, 18 June 2025: Petro Matad Limited, the AIM quoted Mongolian oil
company is pleased to provide the following update.

 

Under its Oil Sales Agreement, Petro Matad has received from PetroChina
partial payment of its invoice for Block XX oil production from the October
2024 start-up of Heron 1 to the end of April 2025. Gross proceeds of $1.18
million were received representing 70% of the invoiced amount. PetroChina has
withheld 30% pending confirmation from the Mongolian tax authorities that
there will be no customs, VAT or other tax charges levied on them in their
role as processor and transporter of the oil. After payment of royalty and the
government's share of the revenue, Petro Matad's net receipt from this payment
is $0.81 million.

The invoice for production in the month of May has been submitted as per the
terms of the agreement and is being processed.

Petro Matad is discussing the oil sales arrangements with the tax authorities
to secure the confirmation PetroChina has requested. In the Company's view,
the law and precedent are clear that customs duties and VAT do not apply under
the Production Sharing Contract. PetroChina's processing and transportation of
Block XX production as third-party business is something new for Mongolia but
with services being charged at cost and representing a very small element of
the overall value, there should be no, or minimal, tax impact. As such, Petro
Matad views the withholding of 30% in no way representative of any uncertainty
that remains, but in the spirit of collaboration shown by the parties to the
agreement and in the interests of starting receipt of funds from commercial
oil sales, the withholding has been acknowledged until the tax authorities
have provided their guidance.

Mike Buck, CEO of Petro Matad, said:

"We are delighted to have received the first payment for Heron 1 oil under our
oil sales agreement. The withholding of funds for matters raised by Petro
Matad during months of discussion that were only declared by the counterparty
to be of concern at the last minute is frustrating but we are working
diligently to secure the confirmation that PetroChina has requested so that
the withheld amount can be paid and future invoices can be paid in full."

Further operational updates will be provided in due course.

- Ends -

 

For 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.

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