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Oil company Petro Matad said it had procured an unsecured loan facility from its major and founding shareholder, Petrovis, as it awaits approval of a development licence in Mongolia.
Petrovis had agreed to make available to Petro Matad a line of credit of up to $1.5 million, to be drawn when needed to maintain the company's operating capability.
Interest on the loan would be paid at effectively the same rate that Petrovis secured US-dollar financing from its banks -- currently 10%.
Petro Matad said progress had been made on the two remaining steps of an exploitation licence application, which needed to be completed prior to submitting a formal request for the Block XX exploitation licence to be awarded.
'Mongolia has been suffering from localised lockdowns in response to the Covid-19 pandemic in recent weeks and another two-week lockdown has just been imposed in Ulaanbaatar in response to a rise in cases,' the company said.
Petro Matad said said it was hopeful the lockdown would not impact a looming meeting of the Mineral Resources and Petroleum Authority of Mongolia (MRPC).
'MRPC met virtually to review and approve the Heron field reserves during Mongolia's December 2020 lockdown,' it said.
'We are focused on successfully completing the exploitation licence application procedure and submitting the application to the minister for award of the licence early in the second quarter of 2021.'
At 8:49am: (LON:MATD) Petro Matad Ltd share price was 0p at 2.5p