Petro Matad Limited (AIM:MATD, OTC:PRTDF) shares fell 10% in Monday’s early deals as it revealed that the Velociraptor-1 exploration well, in central Mongolia, drew a blank.
The exploration company, in a statement, said that the well was drilled down to a depth of 1,500 metres but all the reservoirs it encountered were water-bearing.
The Velociraptor-1 well will now be plugged and abandoned and the rig will be demobilised.
Operations were carried out on time and as budgeted with the full support and cooperation of the local community, the company noted.
"The results of the Velociraptor 1 well are obviously disappointing but such high impact targets, drillable at modest well cost cannot be ignored when exploring frontier areas,” said Petro Matad chief executive Mike Buck.
“The well provides a valuable new data point to help unlock the hydrocarbon potential of the southern Gobi.
“We will now incorporate the well results into our overall evaluation of the area.
“Meanwhile our operational focus shifts back to Block XX where the Heron development offers near-term oil production and revenue generation and where low-risk, near-field exploration opportunities have already been identified which provide exciting upside potential," he added.