Petro Matad's shares fall after work-programme funding update

Petro Matad's shares fell more than 10% after Bergen Global Opportunity Fund agreed to provide $20m-$45m of funding, which would secure the company's firm work programme for its 100%-owned Block IV and V production sharing contracts in Mongolia for 2017 and 2018.

It had entered into a share purchase and convertible securities deed with the fund in connection with a staged private placement of up to $43.2m worth of new shares and a convertible instrument with a nominal value of $2m.

The work programme would comprise four exploration wells and up to 300 sq km of 3D seismic acquisition.

Insitutional investment fund Bergen Global Opportunity Fund is managed by New York asset manager Bergen Asset Management, LLC.

Chief executive Ridvan Karpuz said the Bergen facility was extremely flexible and allowed Petro Matad to effectively manage its cash resources over the next 18 months during a very active operational period for the company.

"We will continue to pursue other investment options that could allow us to either expand our work programme in the event of encouragement with the drilling programme, or alternately reduce the funding required from the Bergen facility," he said.

"In particular, we are in active dialogue with a number of interested parties who are evaluating the farm-out and remain hopeful of concluding an agreement with a farminee prior to the commencement of the first well."

At 12:28 BST, shares in Petro Matad were down 10.57% to 27.5p each.