Petro Matad taps into Mongolian oil field containing up to 23bn barrels

Shares in Petro Matad soared on Wednesday as the oil explorer said it had tapped into a large oil field in Mongolia, which contains between nine and 23bn barrels of oil.

The company updated its estimates of undiscovered petroleum resources following interpretation of new and previously acquired data sets in Blocks IV and V.

The data coverage in the company's acreage revealed 12 basins and this is likely to increase as more work program activities are undertaken in the future, to find potential hydrocarbon volumes within the acreage.

Using the play and basin analysis method on six high-grade basins the company has estimated there to be about 90bn barrels of oil in the upper Jurassic-Lower Cretaceous play, which is the proven and producing petroleum system in Mongolia.

The volume of potentially trapped oil ranges from nine to 23bn barrels of stock oil initially in place, assuming trapping efficiencies of 10% to 25%.

Further potential exists in the deeper Permian-Jurassic play, which is analogous to the prolific systems in the western Chinese basins.

The remaining of six basins, which have sparse data on, will be the focus of future seismic work to determine their potential.

Shares in Petro Matad rose 27.85% to 3.87p at 1305 GMT.