By Philip Waller

LONDON--Shares in Petro Matad Ltd. (MATD.LN) rose as much as 22% on Wednesday after the oil producer said it is set to receive a $5 million compensation payment from Royal Dutch Shell PLC (RDSB.LN) for the latter's withdrawal from two production-sharing contracts in Mongolia.

Petro Matad said all parties have now signed so-called protocols of reassignment of Shell's stake in the deals and payment from Shell is expected in the next 10 days.

Shell issued a notice to Petro Matad exercising its exit option from the contracts, which cover blocks IV and V in west/central Mongolia, last April.

The Mongolian government approved the protocols of reassignment in December, but payment by Shell was delayed due to a technical issue.

Petro Matad is running a farm-out process for the blocks and has set a February deadline for bids.

At 1130 GMT, shares in Petro Matad were up 4.6 pence, or 19%, at 28.75 pence.

-Write to Philip Waller at philip.waller@wsj.com

(END) Dow Jones Newswires

January 18, 2017 07:12 ET (12:12 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.
Shell (LSE:RDSA)
Historical Stock Chart
From Mar 2024 to Apr 2024 Click Here for more Shell Charts.
Shell (LSE:RDSA)
Historical Stock Chart
From Apr 2023 to Apr 2024 Click Here for more Shell Charts.