Petro Matad (LON:MATD) has now drilled through all of its targets in the Davsan Tolgoi-4 (DT-4) exploration well.
This is the AIM-listed explorer’s fourth well in a row to successfully find hydrocarbons, but crucially this is the first one to target this particular part of Block XX.
Earlier this month it confirmed live oil shows in the well’s first target, the Lower Tsagaantsav reservoir. Now this afternoon Petro Matad confirmed that it has found significant hydrocarbons in the deeper targets.
Petro Matad said that initial core and petro-physical analyses indicates that the interval contains approximately 90 metres of reservoir quality sandstone with an average porosity of 15 percent.
"The discovery of significant hydrocarbons in DT-4 highlights the prospectivity of the Lower Tsagaantsav formation, particularly as it tested an entirely separate structure from the previously drilled Davsan Tolgoi anticline,” chief executive Douglas McGay said.
“This is a further step in our knowledge of the reservoir and its potential resource.”
The well was designed to test a four-way closure in the Davsan Tolgoi Shoroo Prospect – which has previously been referred to as Davsan Tolgoi West.
Prior to drilling the Shoroo Prospect was estimated as a 41 million barrels un-risked recoverable resource, with a 69 percent chance of success. Petro Matad stressed that Davsan Tolgoi Shoroo is a separate structure from the discoveries made in the earlier DT-1, DT-2, and DT-3 wells.
McGay said: “The preliminary results from DT-4 indicate that it is very similar to wells that have successfully produced in the neighbouring Block XIX (operated by Daqing Oilfields) with which we share the Lower Tsagaantsav Formation.”
"DT-4 was sited and spudded before the re-interpretation of the 3D seismic survey.
It was designed to solely target the Lower Tsagaantsav formation within the greater Davsan Tolgoi complex.”
The shares - which rose 75 percent in the month leading up to the 2011 field programme – eased 3 pence, or 1.7 percent, lower to trade at 169 pence a share.