Mongolia-focused oil explorer Petro Matad Ltd (AIM: MATD) said its biggest shareholder Petrovis LLC is investing a further £1.35 million in the company via a subscription to 10 million new shares in the group.
Petrovis currently holds 27,505,002 shares which represents 28.44 percent of Petro Matad’s share capital.
The 10 million new shares will be issued in two tranches, 5 million at the end of this month and the other 5 million, subject to shareholder approval, in mid-July.
PetroMatad has granted Petrovis the right to subscribe for up to a further 5 million new Shares at a subscription price of £0.14 per share up to six weeks after the second tranche has been issued.
The new funds will be used to advance the company's exploration activities in Mongolia.
As announced earlier this month, PetroMatad is confident about the overall prospectivity for oil exploration of Block XX, and currently plans to drill up to three wells in the 2009 drill season.Block XX is an inexpensive location for exploration drilling due to the shallow target depth of the wells, the nature of the regional topography and the ready availability of drilling equipment because of the proximity of large oil producing regions of China. The final drilling location of the wells has yet to be determined but in all likelihood all will be on the Davsan Tolgoi prospect, the company had stated.
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