Daily Management Review

Shell Sends An Exit Notice To Petro Matad


The Company of Petro Matad will no longer be supported by its partners.

Shell Sends An Exit Notice To Petro Matad
During the production of “Block IV and V”, Petro Matad lost its contracts sharing partners, in the western and central part of Mongolia on Friday, the 29th April 2016.
The Company of Petro Matad trades into AIM, whereby on the 28th of April 2016, it received an “exit notice” which was issued to “Central Asian Petroleum Corporation”, a hundred percent owned subsidiary of Petro Matad. The said notice came from the Company of Shell, which exercised the option of quitting “the farmout agreement” which dates back to the 7th of April 2015.
A statement issued by the board of Petro Matad goes like this:
“The decision by Shell is based on optimisation of its own portfolio and it is not related to the technical prospects for the blocks”.
“The exit is subject to Mongolian government consent.”
Respecting, the agreement, the affiliate company of Shell are to pay an amount as compensation to the “Central Asian Petroleum Corporation” for making its exit. As per Petro Matad, the amount it will receive will prove to be “highly material”, whereby the “working interest in the two production sharing contracts” will be reverting to hundred percent as oppose to its present twenty two percent share.
In the words of Petro’s board:
“Petro Matad will continue to execute the work program as planned”.
“Currently, our seismic contractor is mobilising to the field and will soon commence the second phase of the planned seismic acquisition programmes in Blocks IV and V.”