Petro Matad Limited provided the following operational update. Operational Update: Block XX local level land use approval: In light of the ongoing delays in the completion of the process by which the Company's Exploitation Area is being confirmed as State Special Purpose Land, the Company has engaged with the District authorities to secure local level approval of land usage. At a meeting of the Matad Citizens' Representatives Committee at the end of February the Company's application for land use in 2024 was approved.

This approval covers all the areas in which the Company wishes to operate during the year. The approval means that the land use agreement can now be prepared and signed by the District authorities and by the Company and it will allow the company's planned operational activities to go ahead whilst the Special Purpose Certification process is completed. The company are hopeful that the Provincial authorities, who are holding up the Special Purpose Certification of the Exploitation Area, will not disrupt in any way the District's approval process, but the company remain vigilant.

The Company is now stepping up the planning for operations to complete the Heron 1 well for production once the contractors re-mobilise after the winter hiatus and as soon as they can make available their crews and equipment. Discussions with PetroChina for transport, processing, storage, export and sale of the Company's early production are also ongoing. State Special Purpose Certification process status: A number of regulatory steps were required to be completed by the Government covering the granting and management of State Special Purpose Land.

As reported previously, a key part of this is a Tripartite Agreement between the Central Land Agency, MMHI and the Governor of Dornod Province. The Governor is still withholding his signature, now on the basis of a partial overlap of the Block XX Exploitation Area with a provincial Protected Area as he claims it breaches the principle of no overlaps in areas for specific land use. The Block XX PSC was signed in 2006 and the provincial Protected Area was not declared by the province until 2014, so it is the province that is in beach of the no overlap principle.

Furthermore, the Land Law allows the central Government to take such land for State Special Purpose use, so this overlap should not be an obstruction to the certification process. Heron 1 and the other locations that the Company wishes to work on in 2024 are not within the overlapped area. The Company has raised this issue formally with government agencies and ministers including: the Mineral Resources and Petroleum Authority of Mongolia, MMHI, Ministry of Economic Development, Central Land Agency, Deputy Prime Minister, Prime Minister and the President.

The Government needs to complete this process and Petro Matad is pushing hard for this to be done. New acreage: As previously reported, the Company was selected as the preferred contractor for the two blocks for which it submitted applications. Despite setting an aggressive timetable for completion of the negotiations and award of the Production Sharing Contracts, the government is now not expected to make the awards until after the 2024 parliamentary elections which take place in the middle of this year.

This new timeframe is not critical as the Company intends to focus all of its operational activity on Block XX in 2024.