SINOGEO
Potentia Exploration Technology Co., Ltd.
Announcement Number: 2026-036
Announcement on the Progress of Major Contract for Ergel-12 Block in Mongolia
The Company and all members of the Board of Directors guarantee the truthfulness, accuracy, and completeness of the information disclosed, and are free from any false records, misleading statements, or material omissions.
I. Background
Potentia Exploration Technology Co., Ltd. (hereinafter referred to as "Potentia Exploration" or "the Company")'s wholly-owned overseas subsidiary, Smart Oil Investment Ltd. (hereinafter referred to as "Smart Oil"), signed the "Ergel-12 PSC" with the Ministry of Mining and Heavy Industry of Mongolia in Ulaanbaatar on September 9, 2016. Smart Oil established Smart Oil Mongolia LLC in Mongolia with its own funds to serve as the project management company for the Ergel-12 Block.
At the 26th meeting of the third Board of Directors held on June 25, 2018, the resolution "Proposal on Changing the Implementing Entity and Implementation Location of the Ergel-12 Block Exploration and Development Project in Mongolia" was approved. The Company agreed to change the implementing entity of the Ergel-12 Block exploration and development project, which was funded by raised capital, from its wholly-owned overseas subsidiary "Smart Oil Investment Ltd." to its wholly-owned overseas subsidiary "Smart Oil and Gas Investment Co., Ltd." (hereinafter referred to as "Smart Oil and Gas").
Smart Oil and Gas holds the oil exploration and exploitation rights for the Ergel-12 Block in Mongolia. Smart Oil and Gas conducts oil and gas exploration operations, including seismic data acquisition, processing, integrated seismic geological interpretation, hydrocarbon evaluation, and well location deployment, and drilling with its own funds. If oil and gas are discovered in the exploration wells, and after the Mongolian government confirms the reserves and approves the development plan, Smart Oil will carry out relevant development and production activities to extract oil. (For details, please refer to the "Major Contract Winning Announcement" and "Announcement on Changing the Implementing Entity of the Ergel-12 Block Exploration and Development Project in Mongolia" published on the CNINFO website on June 23, 2016, and June 26, 2018).