Petro Matad Announces Unaudited Half Yearly Results

Petro Matad Limited, the AIM quoted Mongolian oil explorer, announced its unaudited interim results for the six months ended 30 June 2011 and updated shareholders on events since the period end.

Highlights:

Block XX

• Of the eight wells drilled during 2011, all but one showed presence of hydrocarbons
• Testing programme continues with a full schedule until year's end
• Deferment of drilling through winter until the Company's understanding of Davsan Tolgoi is further developed
• Reprocessed 3D seismic survey providing greater definition of Davsan Tolgoi stratigraphic traps and faults
• Exploration on Block XX has greatly expanded beyond the immediate Davsan Tolgoi area with a significant 2D seismic acquisition programme
• The new seismic is being processed in conjunction with reprocessing of existing data.
• Early results indicate multiple areas of great interest
• A promising new basin has been identified in the southern portion of Block XX
• Technical review and analysis of data ongoing in preparation for recommencement of the Company's drilling and exploration programmes in the Mongolian spring

Block V

• 946kms of seismic survey completed over two basins
• Early seismic profiles over the Tugrug Basin indicate a variety of trap styles
• Analytical results from the stratigraphic drill hole's core have demonstrated that the Tugrug basin contains a productive hydrocarbon system. The present-day depth of the top of the paleo-oil window is around 1400-1500m, and basin depths may be as much as 4500m
• Geological surveys further define source and reservoir rocks
• The emergence of oil shale occurrences as a potential unconventional play

Block IV

• 896kms of 2D seismic acquisition over several basins
• Field examination confirms continuation of source and reservoir sequences and suitable traps over the entire block to its western limit
• The newly identified Argalant area has about 700m of Cretaceous section, including thick sequences of visually rich oil shale. Analytical results are pending
• The Khoid Ulaan Bulag oil shale occurrence may have commercial potential for an unconventional play
• Stratigraphic core drilling is scheduled for the Biger basin in western Block IV

Corporate

• Establishment of in-house legal and compliance department
• Ongoing liaison with the Mongolian Government regarding the possible amendments to Mongolia's petroleum law
• Current cash balance of approximately US$25 million

Please visit the company's website for the chief executive's statement and a detailed operational overview.