Common Shares in Issue and Total Voting Rights

PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL and AIM: PTAL), an independent oil and gas company with assets and operations in Peru, announces that further to the Company’s announcement on 31 May 2019, the Company confirms that following the issue of the Placing Shares (as defined in the 31 May 2019 announcement), the Company will have 671,074,324 Common Shares in issue and there are no shares held in treasury.

For the purposes of the Disclosure Guidance and Transparency Rules, the total number of voting rights in the Company is calculated as the number of outstanding Common Shares, less the Common Shares not able to be voted on due to restrictions applicable to certain holders which results in a total voting rights figure of 626,296,621. This figure may be used by shareholders as the denominator for the calculations by which they determine if they are required to notify their interest in, or a change of their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.

ENDS 

CONTACT DETAILS:

PetroTal Corp.

Manuel (Manolo) Pablo Zúñiga-Pflücker
(President and CEO)

Greg Smith (EVP and CFO)

 Tel: +1 713 609 9101
Strand Hanson Limited

(Nominated & Financial Adviser)
James Spinney / Ritchie Balmer / Eric Allan

Tel: +44 (0) 20 7409 3494
GMP FirstEnergy

(Joint Broker)
Jonathan Wright / Hugh Sanderson

 Tel: +44 (0) 20 7448 0200
Numis Securities Limited

(Joint Broker)
John Prior / Emily Morris

Tel: +44 (0) 20 7260 1000

 

Celicourt Communications

(Financial PR)
Mark Antelme / Jimmy Lea

 Tel: +44 (0) 20 7520 9261

Proposed Placing to Raise at Least £15 million to Accelerate Bretaña Development

THIS ANNOUNCEMENT, INCLUDING THE APPENDIX TO THIS ANNOUNCEMENT, AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, JAPAN, NEW ZEALAND, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT, INCLUDING THE APPENDIX TO THIS ANNOUNCEMENT, IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE: (A) A PROSPECTUS OR OFFERING MEMORANDUM; (B) AN ADMISSION DOCUMENT PREPARED IN ACCORDANCE WITH THE AIM RULES; OR (C) AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.  THIS ANNOUNCEMENT AND THE APPENDIX DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES OF PETROTAL CORP. IN ANY JURISDICTION IN WHICH ANY SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL.

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY THE COMPANY TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION (REGULATION 596/2014/EU). UPON PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

31 May 2019

PetroTal Corp.

Proposed Placing to Raise at Least £15 million to Accelerate Bretaña Development

PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL and AIM: PTAL), an independent oil and gas company with assets and operations in Peru, today announces its intention to issue new common shares in the Company ("Common Shares") to raise in aggregate gross proceeds of not less than £15 million (the “Placing”) at a price of 15 pence per Common Share (the “Placing Price”).

The Placing will be conducted by way of an accelerated bookbuild (the “Bookbuild”) which will open immediately following the release of this announcement. The Placing will only be made available to invited eligible institutional investors in certain specified jurisdictions. A further announcement confirming the number of new Common Shares to be issued pursuant to the Placing (the “Placing Shares”) and final details of the Bookbuild is expected to be made in due course.

GMP FirstEnergy, Numis and Pareto are acting as joint bookrunners (the “Joint Bookrunners”) in relation to the Placing. Strand Hanson is acting as Nominated & Financial Adviser to the Company.

Use of Proceeds

It is intended that the net proceeds of the Placing will be applied to accelerate development activity at the Company’s Bretaña oilfield on Block 95, onshore Peru.  In particular, PetroTal plans to use the net proceeds of the Placing to:

  • Drill one additional water well in 2019 which was originally planned to be drilled in 2020 to provide additional water disposal assurance;
  • Re-complete the existing water disposal well as an oil producer;
  • Sidetrack the existing 2XD well and re-complete as a horizontal production well; and
  • Workover the existing 1XD well to install an electro-submersible pump to increase its oil productivity.

The combined impact of this additional work is to exit 2019 with five oil producing wells and two water disposal wells, with an estimated exit rate of approximately 10,000 to 11,000 barrels of oil per day (BOPD), an increase over the previously announced 7,000 BOPD.

Achievements to Date and Dividend Policy

The Company has executed on bringing the Bretaña field online and increasing production.  Previously announced highlights include:

  • initiating production on June 1, 2018, five months ahead of schedule;
  • installation of facilities for 25 per cent. less cost than budgeted in 2018, allowing the Company to exit 2018 with more cash on the balance sheet than management expected;
  • Declaration of Commerciality in late 2018 at the Bretaña field which allowed the Company to begin using the prior net operating losses, incurred prior to acquisition, to reduce tax liability;
  • increased the net present value discounted to 10 per cent. (“NPV10”) of the Company’s proved plus probable (“2P”) reserves year over year by 90 per cent.;
  • drilled and completed the Company’s first development well, the second oil producer in the field, and brought the well online at an announced 2,250 BOPD;
  • increased production at Bretaña from nil in May 2018, to approximately 1,000 BOPD in June 2018, to 2,000 BOPD in November 2018, to over 3,200 BOPD in May 2019;
  • secured approval in May 2019 of the Environmental Impact Assessment to fully develop the Bretaña oil field in Block 95; and
  • signed a contract with PetroPeru, the State owned oil company, who operate the Oil Northern Pipeline (“ONP”), to deliver oil to the Pacific coast via the ONP, thus allowing the Company to efficiently access commercial markets for the Company’s production.

To review announcements related to these highlights please see the investor page at www.PetroTal‑Corp.com

The board of directors of the Company (the “Board”) understands the importance of optimising value for shareholders and believes in balancing returns to shareholders with investment in the business to support future growth. To this end, subject to the ongoing satisfactory performance of the Company’s operations in Peru, the Board intends to implement a dividend policy pursuant to which the Company will pay dividends following completion of the Placing.  The current intention is for an interim dividend to be paid in Q4 2019 with a final dividend to be paid in or around May 2020, both in respect of the period from 1 July 2019 to 31 December 2019.  With the initial interim and final dividend payments, the Company intends to target an annualised yield of 4% (based on the Placing Price).

Thereafter, consistent with the anticipated improvement in earnings and of cash generation in 2020 and beyond, and subject to prevailing market conditions and other corporate activity, it is expected that the dividend policy of the Company will establish semi-annual dividends, the amount of which will be declared at the discretion of the Board as appropriate and subject to applicable laws.

The Placing and the Bookbuild

GMP FirstEnergy, Numis and Pareto will commence the Bookbuild with immediate effect. The Joint Bookrunners have entered into the Placing Agreement under which, subject to the conditions set out therein, the Joint Bookrunners have agreed to use their respective reasonable endeavours to procure subscribers for the Placing Shares at the Placing Price and as set out in the Placing Agreement.

The Placing Shares, upon issue, will rank equally in all respects with the Existing Common Shares.

The timing of the closing of the Bookbuild and allocations of Placing Shares are at the discretion of the Joint Bookrunners and the Company. The details of the results of the Placing will be announced as soon as practicable after the close of the Bookbuild. Attention is drawn to the Appendix to this Announcement containing, inter alia, the terms and conditions of the Placing (representing important information for invited Placees only).

By choosing to participate in the Placing and by making an oral and legally binding offer to acquire Common Shares in the Placing, Placees will be deemed to have read and understood this Announcement in its entirety (including the Appendix) and to be making such offer on the terms and subject to the conditions in it, and to be providing the representations, warranties and acknowledgements contained in the Appendix.

Manolo Zúñiga, President and CEO of PetroTal commented:

"Having executed like clockwork since taking over the Bretaña project at the end of 2017, while at the same time optimizing the operations as reflected by the 90% increase of the 2P NPV10 estimated by NSAI, our independent qualified reserves evaluator, in the most recent financial year end reserves report, the proposed Placing will allow the Company to reach its initial goal of 10,000 BOPD ahead of plan, resulting in optimized unit lifting and operating expenses, as well as per unit general and administrative costs going forward. This will also allow the Company to continue evaluating the expected crude oil recovery factor, and reach additional oil markets.  This capital will allow PetroTal to maintain an active drilling schedule and avoid rig standby or de-mobilization costs.  The proposed dividend policy is designed to reward shareholders as our increased production delivers significant cash generation.” 

ENDS 

CONTACT DETAILS:

PetroTal Corp.

Manuel (Manolo) Pablo Zúñiga-Pflücker (President and CEO)

Greg Smith (EVP and CFO)

 Tel: +1 713 609 9101
Strand Hanson Limited

(Nominated & Financial Adviser)

James Spinney / Ritchie Balmer / Eric Allan

Tel: +44 (0) 20 7409 3494
GMP FirstEnergy

(Joint Bookrunner and Joint Broker)

Jonathan Wright / Hugh Sanderson

 Tel: +44 (0) 20 7448 0200
Numis Securities Limited

(Joint Bookrunner and Joint Broker)

John Prior / Emily Morris

Tel: +44 (0) 20 7260 1000

 

Pareto Securities Limited

(Joint Bookrunner)

Soren Clausen

Tel: +44 (0) 20 7786 4370
Celicourt Communications

(Financial PR)

Mark Antelme / Jimmy Lea

 Tel: +44 (0) 20 7520 9261 

 

Notes to Editors:

PetroTal is a publicly-traded, dual-listed (TSX-V: TAL and AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's development asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018. Additionally, the Company has large exploration prospects and is engaged in finding a partner to drill the Osheki prospect in Block 107. The Company's management team has significant experience in developing and exploring for oil in Northern Peru and is led by a Board of Directors that is focused on safely and cost effectively developing and exploiting the Bretaña oil field.  More information on the Company can be found at www.PetroTal-Corp.com.

Details of the Placing

The Company is seeking to raise at least £15 million by way of the Placing through the issue of the Placing Shares at 15 pence per share. The Placing Shares will be offered by way of an accelerated book building process which will launch immediately following this announcement.

Placing Agreement

The Company GMP FirstEnergy, Numis and Pareto have today entered into the Placing Agreement, pursuant to which the Company has appointed GMP FirstEnergy, Numis and Pareto as the Company's agents to use their respective reasonable endeavours to procure subscribers for the Placing Shares at the Placing Price. The Placing is not being underwritten by GMP FirstEnergy, Numis and/or Pareto. The Company has agreed to pay GMP FirstEnergy, Numis and Pareto certain commissions and fees in connection with the Placing.

The Placing is conditional on, amongst other things, Admission of the Placing Shares occurring on or before 7.00 a.m. on  5 June 2019 (or such later time and/or date as the Company, GMP FirstEnergy, Numis and Pareto may agree, being not later than 7.00 a.m. on 19 June 2019.

The Placing Agreement contains certain customary warranties given by the Company concerning the accuracy of the information in this Announcement as well as other matters relating to the Group and its business. The Placing Agreement is terminable by GMP FirstEnergy, Numis and/or Pareto in certain circumstances prior to Admission, including for force majeure or in the event of a material adverse change to the business of the Company or the Group. The Company has also agreed to provide a market standard indemnity and undertakings to GMP FirstEnergy, Numis and Pareto.

The Placing Shares will, when issued, be subject to the Articles and By Laws, be credited as fully paid and non-assessable and rank equally in all respects with each other and with the Existing Common Shares, including the right to receive all dividends and other distributions declared, made or paid in respect of the Common Shares after the date of issue of the Placing Shares.

Admission, settlement and CREST

Application will be made to: (a) the London Stock Exchange for Admission of the Placing Shares to trading on AIM; and (b) the TSXV for listing of the Placing Shares for trading on the facilities of the TSXV.

It is expected that Admission will become effective at 7.00 a.m. on 5 June 2019 (or such later date as the Company, GMP FirstEnergy, Numis and Pareto may agree, being not later than 7.00 a.m. on 19 June 2019) and that dealings in the Placing Shares will also commence at that time. The Placing Shares will not trade on the TSXV until the date that is four months and a day after the day of issuance.

Settlement of transactions in the Placing Shares following Admission will take place through depositary interests ("DIs") within the CREST system, subject to certain exceptions. GMP FirstEnergy, Numis, Pareto and the Company reserve the right to require settlement for, and delivery of, the Placing Shares to Placees by such other means that they deem necessary if delivery or settlement of DIs is not possible within the CREST system within the timetable set out in this Announcement or would not be consistent with the regulatory requirements in the Placee's jurisdiction. Each Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions which they have in place with GMP FirstEnergy, Numis and/or Pareto.

DEFINITIONS

The following definitions apply throughout this announcement unless the context otherwise requires:

Admission the admission of the Placing Shares to trading on AIM becoming effective in accordance with Rule 6 of the AIM Rules
Affiliate in respect of any of party, any of its directors, officers, employees or consultants, or, in the case of any of the Joint Bookrunners, any person connected with that Joint Bookrunner as defined in FSMA
AIM the market of that name operated by the London Stock Exchange
AIM Rules the AIM Rules for Companies published by the London Stock Exchange as they may be amended and replaced from time to time
Articles the articles of amalgamation of the Company (as amended from time to time)
By Laws the by- laws of the Company adopted on 18 December 2017 (as amended from time to time)
Common Shares common shares in the capital of the Company
Company or PetroTal PetroTal Corp., a public company incorporated under the laws of Alberta with corporate access number 2020869455 and whose registered office is at c/o Stikeman Elliott LLP Suite 4300, 888 3rd Street S.W., Calgary Alberta T2P 5C5
CREST the relevant system (as defined in the CREST Regulations) which enables title to units of relevant securities (as defined in the CREST Regulations) to be evidenced and transferred without a written instrument and in respect of which Euroclear is the Operator (as defined in the CREST Regulations)
Enlarged Share Capital together, the Existing Common Shares and the Placing Shares
Exchange Information shall have the meaning set out in paragraph 8.1.6 of the Appendix to this Announcement
Existing Common Shares the 537,740,991 Common Shares in issue at the date of this announcement
GMP FirstEnergy FirstEnergy Capital LLP, a Joint Bookrunner and joint broker to the Company and a limited liability partnership incorporated in England and Wales, with registered number OC346410, whose registered office is at  85 London Wall, London, EC2M 7AD
Group the Company and its subsidiaries and subsidiary undertakings from time to time
Joint Bookrunners GMP FirstEnergy, Numis and Pareto
London Stock Exchange London Stock Exchange plc
Numis Numis Securities Limited, a Joint Bookrunner and joint broker to the Company and a private company registered in England and Wales with registered number 2285918, whose registered office is at  10 Paternoster Square, London, EC4M 7LT
Pareto Pareto Securities Limited, a Joint Bookrunner and a private company registered in England and Wales with registered number 3994976, whose registered office is at  11 Berkeley Street, London, W1J 8DS
Placees those persons who subscribe for Placing Shares
Placing the placing of the Placing Shares at the Placing Price by the Joint Bookrunners as agents for and on behalf of the Company pursuant to the terms and conditions of the Placing Agreement and the Appendix to this Announcement
Placing Price 15 pence per Placing Share
Placing Agreement the conditional placing agreement dated 31 May 2019 relating to the Placing and the Vendor Placing and entered into between the Company GMP FirstEnergy, Numis and Pareto
Placing Shares the new Common Shares to be issued to Placees pursuant to the Placing
TSXV TSX Venture Exchange
United Kingdom or UK the United Kingdom of Great Britain and Northern Ireland
United States or US the United States of America, its territories and possessions, any state of the United States and the District of Columbia and all other areas subject to its jurisdiction
£ or Sterling pounds sterling, the basic currency of the United Kingdom
US$ United States dollar, the legal currency of the United States

 

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this announcement.

APPENDIX

TERMS AND CONDITIONS OF THE PLACING

IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES ONLY

THIS ANNOUNCEMENT INCLUDES STATEMENTS, ESTIMATES, OPINIONS AND PROJECTIONS WITH RESPECT TO ANTICIPATED FUTURE PERFORMANCE OF THE GROUP (FORWARD-LOOKING STATEMENTS) WHICH REFLECT VARIOUS ASSUMPTIONS CONCERNING ANTICIPATED RESULTS TAKEN FROM THE GROUP'S CURRENT BUSINESS PLAN OR FROM PUBLIC SOURCES, INCLUDING, WITHOUT LIMITATION, PETROTAL’S BUSINESS STRATEGY, OBJECTIVES, STRENGTH AND FOCUS; DRILLING AND COMPLETION ACTIVITIES AND THE RESULTS AND TIMING OF SUCH ACTIVITIES; THE ABILITY OF THE COMPANY TO ACHIEVE DRILLING SUCCESS CONSISTENT WITH MANAGEMENT’S EXPECTATIONS; ANTICIPATED FUTURE PRODUCTION AND REVENUE; FUTURE DEVELOPMENT AND GROWTH PROSPECTS; THE PLACING, INCLUDING THE AGGREGATE PROCEEDS THEREOF, THE CLOSING DATE AND THE USE OF PROCEEDS; THE COMPANY’S DIVIDEND POLICY, INCLUDING THE INTENTION TO COMMENCE PAYING DIVIDENDS AND THE TIMING AND RATE THEREOF WHICH MAY OR MAY NOT PROVE TO BE CORRECT. THESE FORWARD LOOKING STATEMENTS CAN BE IDENTIFIED BY THE USE OF FORWARD LOOKING TERMINOLOGY, INCLUDING THE TERMS "ANTICIPATES", "TARGET", "BELIEVES", "ESTIMATES", "EXPECTS", "INTENDS", "MAY", "PLANS", "PROJECTS", "SHOULD" OR "WILL", OR, IN EACH CASE, THEIR NEGATIVE OR OTHER VARIATIONS OR COMPARABLE TERMINOLOGY OR BY DISCUSSIONS OF STRATEGY, PLANS, OBJECTIVES, GOALS, FUTURE EVENTS OR INTENTIONS. SUCH FORWARD-LOOKING STATEMENTS REFLECT CURRENT EXPECTATIONS BASED ON THE CURRENT BUSINESS PLAN AND VARIOUS OTHER ASSUMPTIONS, INCLUDING, BUT NOT LIMITED TO, EXPECTATIONS AND ASSUMPTIONS CONCERNING THE ABILITY OF EXISTING INFRASTRUCTURE TO DELIVER PRODUCTION AND THE ANTICIPATED CAPITAL EXPENDITURES ASSOCIATED THEREWITH, RESERVOIR CHARACTERISTICS, RECOVERY FACTOR, EXPLORATION UPSIDE, PREVAILING COMMODITY PRICES AND THE ACTUAL PRICES RECEIVED FOR PETROTAL’S PRODUCTS, THE AVAILABILITY AND PERFORMANCE OF DRILLING RIGS, FACILITIES, PIPELINES, OTHER OILFIELD SERVICES AND SKILLED LABOUR, ROYALTY REGIMES AND EXCHANGE RATES, THE APPLICATION OF REGULATORY AND LICENSING REQUIREMENTS, THE ACCURACY OF PETROTAL’S GEOLOGICAL INTERPRETATION OF ITS DRILLING AND LAND OPPORTUNITIES, CURRENT LEGISLATION, RECEIPT OF REQUIRED REGULATORY APPROVAL, THE SUCCESS OF FUTURE DRILLING AND DEVELOPMENT ACTIVITIES, THE PERFORMANCE OF NEW WELLS, THE COMPANY’S GROWTH STRATEGY, GENERAL ECONOMIC CONDITIONS AND AVAILABILITY OF REQUIRED EQUIPMENT AND SERVICES, AND INVOLVE SIGNIFICANT RISKS AND UNCERTAINTIES AND SHOULD NOT BE READ AS GUARANTEES OF FUTURE PERFORMANCE OR RESULTS AND WILL NOT NECESSARILY BE ACCURATE INDICATIONS OF WHETHER OR NOT SUCH RESULTS WILL BE ACHIEVED. ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE CURRENTLY ANTICIPATED DUE TO A NUMBER OF FACTORS AND RISKS. THESE INCLUDE, BUT ARE NOT LIMITED TO, RISKS ASSOCIATED WITH THE OIL AND GAS INDUSTRY IN GENERAL (E.G., OPERATIONAL RISKS IN DEVELOPMENT, EXPLORATION AND PRODUCTION; DELAYS OR CHANGES IN PLANS WITH RESPECT TO EXPLORATION OR DEVELOPMENT PROJECTS OR CAPITAL EXPENDITURES; THE UNCERTAINTY OF RESERVE ESTIMATES; THE UNCERTAINTY OF ESTIMATES AND PROJECTIONS RELATING TO PRODUCTION, COSTS AND EXPENSES; AND HEALTH, SAFETY AND ENVIRONMENTAL RISKS), COMMODITY PRICE AND EXCHANGE RATE FLUCTUATIONS, LEGAL, POLITICAL AND ECONOMIC INSTABILITY IN PERU, ACCESS TO TRANSPORTATION ROUTES AND MARKETS FOR THE COMPANY’S PRODUCTION, CHANGES IN LEGISLATION AFFECTING THE OIL AND GAS INDUSTRY AND UNCERTAINTIES RESULTING FROM POTENTIAL DELAYS OR CHANGES IN PLANS WITH RESPECT TO EXPLORATION OR DEVELOPMENT PROJECTS OR CAPITAL EXPENDITURES. PLEASE REFER TO THE RISK FACTORS IDENTIFIED IN THE COMPANY’S ANNUAL INFORMATION FORM AND MANAGEMENT’S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED DECEMBER 31, 2018 WHICH ARE AVAILABLE ON SEDAR AT WWW.SEDAR.COM. AS A RESULT, PROSPECTIVE INVESTORS SHOULD NOT RELY ON SUCH FORWARD-LOOKING STATEMENTS DUE TO THE INHERENT UNCERTAINTY THEREIN. NO REPRESENTATION OR WARRANTY IS GIVEN AS TO THE COMPLETENESS OR ACCURACY OF THE FORWARD-LOOKING STATEMENTS CONTAINED IN THIS ANNOUNCEMENT. FORWARD-LOOKING STATEMENTS SPEAK ONLY AS OF THE DATE OF SUCH STATEMENTS AND, EXCEPT AS REQUIRED BY THE TSXV, THE FCA, THE LONDON STOCK EXCHANGE, THE AIM RULES OR APPLICABLE LAW, THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE OR REVISE PUBLICLY ANY FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE. NO STATEMENT IN THIS ANNOUNCEMENT IS INTENDED TO BE A PROFIT FORECAST AND NO STATEMENT IN THIS ANNOUNCEMENT SHOULD BE INTERPRETED TO MEAN THAT EARNINGS PER SHARE OF THE COMPANY FOR THE CURRENT OR FUTURE FINANCIAL YEARS WOULD NECESSARILY MATCH OR EXCEED THE HISTORICAL PUBLISHED EARNINGS PER SHARE OF THE COMPANY. THE PRICE OF COMMON SHARES AND THE INCOME FROM THEM MAY GO DOWN AS WELL AS UP AND INVESTORS MAY NOT GET BACK THE FULL AMOUNT INVESTED ON DISPOSAL OF THE COMMON SHARES. PAST PERFORMANCE IS NO GUIDE TO FUTURE PERFORMANCE AND PERSONS WHO REQUIRE ADVICE SHOULD CONSULT AN INDEPENDENT FINANCIAL ADVISER. IN ADDITION, THE PAYMENT OF DIVIDENDS IS NOT GUARANTEED AND THE DECLARATION, AMOUNT AND TIMING OF ANY DIVIDENDS PAYABLE BY THE COMPANY WILL BE AT THE DISCRETION OF THE BOARD HAVING REGARD TO CORPORATE SOLVENCY TESTS, THE COMPANY’S CASH RESERVES, FINANCIAL REQUIREMENTS OF THE COMPANY, AGREEMENTS GOVERNING INDEBTEDNESS AND OTHER RELEVANT FACTORS.

THIS PRESS RELEASE CONTAINS FUTURE-ORIENTED FINANCIAL INFORMATION AND FINANCIAL OUTLOOK INFORMATION (COLLECTIVELY, “FOFI”) ABOUT PETROTAL’S PROSPECTIVE RESULTS OF OPERATIONS, PRODUCTION AND COMPONENTS THEREOF, ALL OF WHICH ARE SUBJECT TO THE SAME ASSUMPTIONS, RISK FACTORS, LIMITATIONS AND QUALIFICATIONS AS SET FORTH IN THE ABOVE PARAGRAPHS. FOFI CONTAINED IN THIS PRESS RELEASE WAS MADE AS OF THE DATE OF THIS PRESS RELEASE AND WAS PROVIDED FOR THE PURPOSE OF PROVIDING FURTHER INFORMATION ABOUT PETROTAL’S ANTICIPATED FUTURE BUSINESS OPERATIONS. THE FOFI CONTAINED IN THIS PRESS RELEASE HAS BEEN APPROVED BY MANAGEMENT AS OF THE DATE OF THIS PRESS RELEASE. PETROTAL DISCLAIMS ANY INTENTION OR OBLIGATION TO UPDATE OR REVISE ANY FOFI CONTAINED IN THIS PRESS RELEASE, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE, UNLESS REQUIRED PURSUANT TO APPLICABLE LAW. READERS ARE CAUTIONED THAT THE FOFI CONTAINED IN THIS PRESS RELEASE SHOULD NOT BE USED FOR PURPOSES OTHER THAN FOR WHICH IT IS DISCLOSED HEREIN. ALL FOFI CONTAINED IN THIS PRESS RELEASE COMPLIES WITH THE REQUIREMENTS OF CANADIAN SECURITIES LEGISLATION.

THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX (TOGETHER THE ANNOUNCEMENT) AND THE INFORMATION IN IT, IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, NEW ZEALAND, JAPAN OR SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED INVESTORS AS DEFINED IN SECTION 2(7) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000, AS AMENDED, (QUALIFIED INVESTORS) BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE EU PROSPECTUS DIRECTIVE (WHICH MEANS DIRECTIVE 2003/71/EC AND INCLUDES ANY RELEVANT IMPLEMENTING DIRECTIVE MEASURE IN ANY MEMBER STATE) (THE PROSPECTUS DIRECTIVE); AND (B) IN THE UNITED KINGDOM, TO QUALIFIED INVESTORS WHO ARE PERSONS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(1) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE ORDER); (II) ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC") OF THE ORDER; OR (III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS IN (A) OR (B) TOGETHER BEING REFERRED TO AS RELEVANT PERSONS).

THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVENT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that the Placing Shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, Placees should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing.  Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Bookrunners will only procure investors who meet the criteria of professional clients and eligible counterparties.  For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.

In this Appendix, unless the context requires, Placee means a Relevant Person (including individuals, funds or others) who has been invited to, and who chooses to, participate in the Placing and by whom or on whose behalf a commitment to subscribe for Placing Shares has been given.

No representation or warranty, express or implied, is made or given by or on behalf of the Company, ,  GMP FirstEnergy, Numis or Pareto, or any of their respective Affiliates  or any of such persons' directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this Announcement and no liability whatsoever is accepted by the Company, GMP FirstEnergy, Numis or Pareto or any of such persons' Affiliates, directors, officers or employees or any other person for any loss howsoever arising, directly or indirectly, from any use of such information or opinions or otherwise arising in connection therewith.

This Announcement does not constitute an offer to sell or issue or the solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction in which such offer or solicitation is or may be unlawful.

Without prior written approval of the TSXV and compliance with all applicable Canadian securities laws, the Placing Shares may not be sold, transferred, hypothecated or otherwise traded on or through the facilities of TSXV or otherwise in Canada or to or for the benefit of a Canadian resident until the date that is four months and a day after the date of issuance.

The relevant clearances have not been, nor will they be, obtained from the securities commission of any province or territory of Canada; no prospectus has been lodged with or registered by, the Australian Securities and Investments Commission or the Japanese Ministry of Finance; and the Placing Shares have not been, nor will they be, registered or qualified for distribution, as applicable under or offered in compliance with the securities laws of any state, province or territory of United States, Australia, New Zealand, Canada, Japan or South Africa. Accordingly, the Placing Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into the United States, Australia, New Zealand, Canada, Japan or South Africa or any other jurisdiction outside the United Kingdom.

Persons distributing any part of this Announcement must satisfy themselves that it is lawful to do so. Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this Announcement should seek appropriate advice before taking any action. Persons into whose possession this Announcement comes are required by the Company,  GMP FirstEnergy, Numis and Pareto to inform themselves about, and observe, any such restrictions.

This Announcement does not constitute a recommendation concerning any investors' options with respect to the Placing . Investors and prospective investors should conduct their own investigation, analysis and evaluation of the business and data described in this Announcement. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The contents of this Announcement are not to be construed as legal, business, financial or tax advice. Each investor or prospective investor should consult his, her or its own legal adviser, business adviser, financial adviser or tax adviser for legal, financial, business or tax advice.

Placees will be deemed: (i) to have read and understood this Announcement, including this Appendix, in its entirety; and (ii) to be participating and making an offer for Placing Shares on the terms and conditions and to be providing the representations, warranties, acknowledgements and undertakings, contained in this Appendix.

This Announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the Placing Shares. Any investment decision to subscribe for Placing Shares in the Placing a must be made solely on the basis of publicly available information, which has not been independently verified by  GMP FirstEnergy, Numis and/or Pareto.

The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than the AIM Market of the London Stock Exchange (AIM) and the TSXV.

  1. DETAILS OF THE PLACING
    • GMP FirstEnergy, Numis and Pareto today entered into an agreement with the Company (the “Placing Agreement”). Under the Placing Agreement, the Company has, subject to certain conditions, appointed GMP FirstEnergy, Numis and Pareto as the Company's agents to use their respective reasonable endeavours to procure subscribers for the Placing Shares at the Placing Price. The Placing is not being underwritten by GMP FirstEnergy, Numis or Pareto.
    • The Placing Shares will, when issued, be subject to the Articles and By Laws, be credited as fully paid and non-assessable and rank equally in all respects with each other and with the Existing Common Shares, including the right to receive all dividends and other distributions declared, made or paid in respect of the Common Shares after the date of issue of the Placing Shares.
  2. APPLICATION FOR ADMISSION TO TRADING
    • Application will be made to (a) the London Stock Exchange for admission to trading of the Placing Shares on AIM; and (b) the TSXV for listing of the Placing Shares for trading on the facilities of the TSXV.
    • It is expected that admission of the Placing Shares will become effective on or around 5 June 2019 and that dealings in the Placing Shares will commence at 8.00 a.m. on the same day.
  3. PARTICIPATION IN, AND PRINCIPAL TERMS OF, THE PLACING
    • GMP FirstEnergy, Numis and Pareto are acting as joint bookrunners and as agents for the Company in connection with the Placing and Admission. GMP FirstEnergy, Numis and Pareto are each authorised and regulated in the United Kingdom by the FCA, and are each acting exclusively for the Company and no one else in connection with the matters referred to in this Announcement and will not be responsible to anyone other than the Company for providing the protections afforded to the customers of GMP FirstEnergy, Numis and Pareto or for providing advice in relation to the matters described in this Announcement.
    • Participation in the Placing is only available to persons who may lawfully be, and are invited to participate in it by GMP FirstEnergy, Numis and/or Pareto. GMP FirstEnergy, Numis and Pareto and their respective Affiliates are each entitled to participate in the Placing as principals.
    • The Placing Price will be a fixed price of 15 pence per Placing Share. Details of the number of Placing Shares will be announced as soon as practicable after the closing of the Bookbuild.
    • Each prospective Placee's allocation of Placing Shares will be confirmed to prospective Placees orally by GMP FirstEnergy, Numis and Pareto or one of their respective Affiliates, and a contract note will be dispatched as soon as practicable thereafter as evidence of such Placee's allocation and commitment.  The terms and conditions of this Appendix will be deemed incorporated into the contract note. That oral confirmation will constitute an irrevocable legally binding commitment upon that person (who at that point will become a Placee) in favour of GMP FirstEnergy, Numis and Pareto (as applicable) to subscribe for the number of Placing Shares allocated to it at the Placing Price on the terms and conditions set out in this Appendix and in accordance with the Articles and By Laws and each Placee will be deemed to have read and understood this Announcement in its entirety.  An offer to acquire Placing Shares, which has been communicated by a prospective Placee to GMP FirstEnergy, Numis or Pareto (as applicable) which has not been withdrawn or revoked prior to publication of this Announcement shall not be capable of withdrawal or revocation immediately following the publication of this Announcement without the consent of GMP FirstEnergy, Numis or Pareto (as applicable).
    • Each Placee will also have an immediate, separate, irrevocable and binding obligation, owed to GMP FirstEnergy, Numis and Pareto, as applicable (as agents of the Company ), to pay the relevant entity (or as it may direct) in cleared funds immediately on settlement an amount equal to the product of the Placing Price and the aggregate number of Placing Shares such Placee has agreed to subscribe for. Each Placee's obligation will be owed to the Company and GMP FirstEnergy, Numis and Pareto, as applicable.
    • Irrespective of the time at which a Placee's allocation pursuant to the Placing is confirmed, settlement for all Placing Shares to be subscribed for pursuant to the Placing will be required to be made at the same time, on the basis explained below under "Registration and Settlement".
    • All obligations under the Placing will be subject to fulfilment of the conditions referred to below under "Conditions of the Placing " and to the Placing Agreement not being terminated on the basis referred to below under "Termination of the Placing Agreement".
    • By participating in the Placing, each Placee will agree that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee.
    • To the fullest extent permitted by law and applicable FCA rules, neither GMP FirstEnergy nor any of its Affiliates shall have any liability (including to the extent permissible by law, any fiduciary duties) to Placees or to any person other than the Company in respect of the Placing.
    • To the fullest extent permitted by law and applicable FCA rules, neither Numis nor any of its Affiliates shall have any liability (including to the extent permissible by law, any fiduciary duties) to Placees or to any person other than the Company in respect of the Placing.
    • To the fullest extent permitted by law and applicable FCA rules, neither Pareto nor any of its Affiliates shall have any liability (including to the extent permissible by law, any fiduciary duties) to Placees or to any person other than the Company in respect of the Placing.
  4. CONDITIONS OF THE PLACING
    • The obligations of GMP FirstEnergy, Numis and Pareto to the Company under the Placing Agreement are conditional on, amongst other things:
      • the compliance by the Company with all its obligations which are required to be performed or satisfied on or prior to Admission;
      • the respective obligations of GMP FirstEnergy, Numis and Pareto under the Placing Agreement not having been terminated prior to Admission;
      • Admission occurring by 8:00 am on 5 June 2019 (or such later time and date as GMP FirstEnergy, Numis and Pareto (acting together) may agree being not later than 8:00 a.m. on 19 June 2019).
    • If (i) any condition contained in the Placing Agreement is not fulfilled or waived by GMP FirstEnergy, Numis and Pareto (acting together), by the respective time or date where specified (or such later time or date as GMP FirstEnergy, Numis and Pareto may agree), (ii) any such condition becomes incapable of being fulfilled or (iii) the Placing Agreement is terminated in accordance with its terms, the Placing will not proceed and the Placees’ rights and obligations hereunder in relation to the relevant shares shall cease and terminate at such time and each Placee agrees that no claim can be made by the Placee in respect thereof.
    • GMP FirstEnergy, Numis and Pareto may, in their sole discretion and upon such terms as they think fit, waive compliance by the Company with the whole or any part of any of the Company's obligations in relation to the conditions in the Placing Agreement, save that condition 4.1.3 above relating to Admission may not be waived. Any such extension or waiver will not affect the Placees' commitments as set out in this Announcement.
    • None of GMP FirstEnergy, Numis or Pareto shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision they may make as to whether or not to waive or to extend the time and/or the date for the satisfaction of any condition of the Placing nor for any decision they may make as to the satisfaction of any condition or in respect of the Placing generally, and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of GMP FirstEnergy, Numis and Pareto (acting together).
  5. TERMINATION OF THE PLACING AGREEMENT
    • GMP FirstEnergy, Numis and Pareto are entitled, at any time prior to Admission, to terminate the Placing Agreement with the Company in respect of the Placing Shares in accordance with the terms of the Placing Agreement by giving written notice to the Company in certain circumstances, including but not limited to (i) any of the warranties given to GMP FirstEnergy, Numis and Pareto in the Placing Agreement being untrue, inaccurate or misleading in any material respect; (ii) the failure of the Company to comply in any material respect with their respective obligations under the Placing Agreement; (iii) a matter arising which might in the opinion of GMP FirstEnergy, Numis and/or Pareto, acting in good faith, give rise to a claim under the indemnities in the Placing Agreement or (iv) the occurrence of a force majeure event which in the opinion of GMP FirstEnergy, Numis and Pareto would be materially adverse to the success of the Placing or would render proceeding with the Placing impracticable or inadvisable.
    • By participating in the Placing, Placees agree that the exercise by GMP FirstEnergy, Numis and Pareto of any right of termination or other discretion under the Placing Agreement shall be within the absolute discretion of GMP FirstEnergy, Numis and Pareto, that it need not make any reference to Placees and that none of GMP FirstEnergy, Numis, Pareto or the Company (or any of their respective directors, officers or employees) shall have any liability to Placees whatsoever in connection with any such exercise.
  6. NO ADMISSION DOCUMENT OR PROSPECTUS
    • No offering document, admission document or prospectus has been or will be submitted to be approved by the FCA or submitted to the London Stock Exchange in relation to the Placing or the Placing Shares and Placees' commitments will be made solely on the basis of the information contained in this Announcement (including this Appendix) and the Exchange Information.
    • Each Placee, by accepting a participation in the Placing, agrees that the content of this Announcement is exclusively the responsibility of the Company and confirms that it has neither received nor relied on any other information (other than the Exchange Information), representation, warranty, or statement made by or on behalf of the Company, GMP FirstEnergy, Numis or Pareto or any other person and none of GMP FirstEnergy, Numis, Pareto, nor the Company nor any other person will be liable for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement which the Placees may have obtained or received. Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing . Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.
  7. REGISTRATION AND SETTLEMENT
    • Settlement of transactions in the Placing Shares (ISIN: CA71677J1012) following Admission will take place through DIs within CREST, subject to certain exceptions.  GMP FirstEnergy, Numis and Pareto reserve the right to require settlement for, and delivery of, the Placing Shares (or a portion thereof) to Placees in certificated form if, in their opinion, delivery or settlement is not possible or practicable within the CREST system within the timetable set out in this Announcement or would not be consistent with the regulatory requirements in any Placee's jurisdiction.
    • Each Placee allocated Placing Shares in the Placing will be sent a contract note in accordance with the standing arrangements in place with GMP FirstEnergy, Numis or Pareto (as applicable), stating the aggregate number of Placing Shares allocated to it at the Placing Price, the aggregate amount owed by such Placee to GMP FirstEnergy, Numis or Pareto (as applicable) and settlement instructions.  Each Placee agrees that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions that it has in place with GMP FirstEnergy, Numis or Pareto (as applicable).
    • The Company will (via its registrar) deliver the Placing Shares to a CREST account operated by Numis or Pareto (as applicable) as agent for the Company and Numis or Pareto (as applicable) will enter its delivery (DEL) instruction into the CREST system.  Numis or Pareto (as applicable) will hold any Placing Shares delivered to this account as nominee for the Placees. The input to CREST by a Placee of a matching or acceptance instruction will then allow delivery of the relevant Placing Shares to that Placee against payment.
    • It is expected that settlement will take place on or around 5 June 2019, in each case in accordance with the instructions set out in the contract note.
    • Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above at the rate of two percentage points above the base rate of Barclays Bank plc from time to time.
    • Each Placee agrees that, if it does not comply with these obligations, GMP FirstEnergy, Numis or Pareto (as applicable) may sell any or all of the Placing Shares allocated to that Placee on such Placee's behalf and retain from the proceeds, for GMP FirstEnergy’s, Numis’ and Pareto’s account and benefit (as applicable), an amount equal to the aggregate amount owed by the Placee plus any interest due.  The relevant Placee will, however, remain liable for any shortfall below the aggregate amount owed by it and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of such Placing Shares on such Placee's behalf.
    • If Placing Shares are to be delivered to a custodian or settlement agent, Placees should ensure that the contract note is copied and delivered immediately to the relevant person within that organisation.
    • Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to UK stamp duty or stamp duty reserve tax.
  8. REPRESENTATIONS AND WARRANTIES
    • By participating in the Placing, each Placee (and any person acting on such Placee's behalf) irrevocably acknowledges, undertakes, represents, warrants and agrees (as the case may be) that:
      • it has read and understood this Announcement (including this Appendix) in its entirety and its subscription for the Placing Shares is subject to and based on the terms and conditions of the Placing as referred to and included in this Announcement;
      • it undertakes not to redistribute or duplicate this Announcement;
      • it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgements and agreements contained in this Announcement;
      • it understands (or, if acting for the account of another person, such person understands) the resale and transfer restrictions set out in this Announcement.
      • no offering document, admission document or prospectus has been prepared in connection with the Placing and that it has not received and will not receive a prospectus, admission document or other offering document in connection with the Placing;
      • the Common Shares are admitted to trading on AIM and the TSXV and the Company is a “reporting issuer” (or equivalent thereof) in the provinces of Alberta, British Columbia, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador in Canada, and the Company is therefore required to publish certain business and financial information in accordance with Canadian securities laws, the AIM Rules and the other applicable rules and practices of the London Stock Exchange, the TSXV and/or the FCA (collectively Exchange Information), which includes the Company's most recent balance sheet and profit and loss account and that it is able to obtain or access such information or comparable information concerning any other publicly traded company without undue difficulty;
      • (i) it has made its own assessment of the Company, the Placing Shares and the terms and conditions of the Placing and has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing and has satisfied itself that the information is still current; (ii) none of GMP FirstEnergy, Numis, Pareto or the Company, any of their respective Affiliates or any person acting on behalf of any of them has provided, or will provide it, with any material regarding the Placing Shares in addition to this Announcement; and (iii) it has not requested GMP FirstEnergy, Numis, Pareto or the Company or any of their respective Affiliates or any person acting on behalf of any of them to provide it with any such information;
      • the content of this Announcement is exclusively the responsibility of the Company and that none of , GMP FirstEnergy, Numis, Pareto, their Affiliates or any person acting on their behalf has or shall have any liability for any information, representation or statement contained in this Announcement or any information previously or concurrently published by or on behalf of the Company and will not be liable for any Placee's decision to participate in the Placing based on any information, representation or statement contained in this Announcement or elsewhere;
      • the only information on which it has relied in committing itself to subscribe for the Placing Shares is contained in this Announcement and any Exchange Information and that it has not received or relied on any information given or any representations, warranties or statements, express or implied, made by GMP FirstEnergy, Numis, Pareto or the Company or any of their Affiliates or any person acting on behalf of any of them and none of GMP FirstEnergy, Numis, Pareto, the Company, any of their Affiliates or any person acting on behalf of any of them will be liable for its decision to accept an invitation to participate in the Placing based on any information, representation, warranty or statement other than that contained in this Announcement and any Exchange Information;
      • it has not received (save as disclosed in this Announcement) nor relied on any "inside information" as defined in the EU Market Abuse Regulation 596/2014 concerning the Company in accepting this invitation to participate in the Placing and is not subscribing for Placing Shares on the basis of "inside information";
      • it has the funds available to pay for the Placing Shares it has agreed to subscribe for and acknowledges, agrees and undertakes that it will pay the total subscription amount in accordance with the terms of this Announcement on the due time and date set out herein, failing which the relevant Placing Shares may be placed with other Placees or sold at such price as GMP FirstEnergy, Numis or Pareto (as applicable) determines;
      • it: (i) is entitled to subscribe for the Placing Shares under the laws of all relevant jurisdictions; (ii) has fully observed such laws; (iii) has the requisite capacity and authority and is entitled to enter into and to perform its obligations as a subscriber for Placing Shares and will honour such obligations; and (iv) has obtained all necessary consents and authorities (including, without limitation, in the case of any person on whose behalf it is acting, all necessary consents and authorities to agree to the terms set out or referred to in this Announcement) to enable it to enter into the transactions contemplated hereby and to perform its obligations in relation thereto and, in particular, if it is a pension fund or investment company it is aware of and acknowledges it is required to comply with all applicable laws and regulations with respect to its subscription for Placing Shares;
      • it acknowledges that the Placing Shares will be subject to certain restrictions with respect to certain resales to persons in Canada for a period of four months and a day following the issuance of the Placing Shares and it agrees to comply with such restrictions and that it will give to each person to who it transfers the Placing Shares notice of such restrictions on transfer of such Placing Shares;
      • it is not, and any person who it is acting on behalf of is not, and at the date of Admission will not be, a resident of, or with an address in, the United States, Australia, New Zealand, Canada, Japan or South Africa, and it acknowledges and agrees that the Placing Shares have not been nor will be registered or otherwise qualified under the securities legislation of the United States, Australia, New Zealand, Canada, Japan or South Africa and may not be offered, sold, or acquired, directly or indirectly, within those jurisdictions, except, in the case of Canada, in accordance with an exemption from Canadian securities laws, and may not be traded on or through the facilities of the TSXV until the date that is four months and a day after the date of issue of the Placing Shares;
      • (i) the Placing Shares have not been nor will they be registered under the Securities Act or with any state or other jurisdiction of the United States, nor approved or disapproved by the US Securities and Exchange Commission, any state securities commission in the United States or any other United States regulatory authority, (ii) it will not offer, sell or deliver, directly or indirectly, any Placing Shares in or into the United States other than pursuant to an effective registration under the Securities Act or in a transaction exempt from, or not subject to, the registration requirements thereunder and in compliance with any applicable securities laws of any state or other jurisdiction of the United States, and (iii) it is outside of the United States, not acting on a non-discretionary basis for the account or benefit of a person located within the United States at the time the undertaking to acquire the Placing Shares is given and is otherwise acquiring the Placing Shares in an "offshore transaction" meeting the requirements of Regulation S under the Securities Act;
      • it has complied with all relevant laws of all relevant territories, obtained all requisite governmental or other consents which may be required in connection with subscribing for Placing Shares, complied with all requisite formalities and that it has not taken any action or omitted to take any action which will or may result in the Joint Bookrunners, the Company, or any of their respective directors, officers, agents, employees or advisers acting in breach of the legal or regulatory requirements of any territory in connection with the Placing;
      • its subscription for Placing Shares does not trigger, in the jurisdiction in which it is resident or located or which is otherwise applicable: (i) any obligation to prepare or file a prospectus or similar document or any other report with respect to such subscription; (ii) any disclosure or reporting obligation of the Company ; or (iii) any registration or other obligation on the part of the Company;
      • it is a person of a kind described in (i) Article 19(5) (Investment Professionals) and/or 49(2) (high net worth companies etc.) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended, and/or an authorised person as defined in section 31 of FSMA; and (ii) section 86(7) of FSMA (Qualified Investor), being a person falling within Article 2.1(e) of the Prospectus Directive.  For such purposes, it undertakes that it will acquire, hold, manage and (if applicable) dispose of any Placing Shares that are allocated to it for the purposes of its business only;
      • if a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, that the Placing Shares subscribed for by it in the Placing will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, persons in a Member State of the European Economic Area which has implemented the Prospectus Directive other than Qualified Investors, or in circumstances in which the prior consent of GMP FirstEnergy, Numis or Pareto has been given to the offer or resale;
      • it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) relating to the Placing Shares in circumstances in which section 21(1) of FSMA does not require approval of the communication by an authorised person and it acknowledges and agrees that this Announcement has not been approved by GMP FirstEnergy, Numis or Pareto in their capacity as an authorised person under section 21 of FSMA and it may not therefore be subject to the controls which would apply if it was made or approved as financial promotion by an authorised person;
      • it is aware of and acknowledges that it has complied with and will comply with all applicable provisions of FSMA with respect to anything done by it in relation to the Placing Shares in, from or otherwise involving, the United Kingdom;
      • it will not make any offer to the public of the Placing Shares and has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom or elsewhere in the European Economic Area prior to Admission except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted in and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of FSMA or an offer to the public in any other member state of the European Economic Area within the meaning of the Prospectus Directive (which includes any relevant implementing measure in any Member State of the European Economic Area);
      • it has not been engaged to subscribe for Placing Shares on behalf of any other person who is not a Qualified Investor unless the terms on which it is engaged enable it to make decisions concerning the acceptance of offers of transferable securities on the client's behalf without reference to the client as described in section 86(2) of FSMA;
      • any funds used to pay for the Placing Shares are not proceeds of crime as defined in the Proceeds of Crime (Money Laundering) and Terrorist Placing Act (Canada) (PCMLTFA). None of the funds to be provided by it (i) have been or will be derived from or related to any activity that is deemed criminal under the laws of Canada or any other applicable jurisdiction, or (ii) are being tendered on behalf of a person or entity (A) with whom the Company, GMP FirstEnergy, Numis or Pareto would be prohibited from dealing with under applicable money laundering, terrorist financing, economic sanctions, criminal or other similar laws or regulations or (B) who has not been identified to it;
      • it is aware of and acknowledges that it is required to comply, and does and will comply, with its obligations under the Criminal Justice Act 1993 and the EU Market Abuse Regulation 596/2014 in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000, the Terrorism Act 2006 and the Money Laundering Regulations 2017 and the Money Laundering Sourcebook of the FCA (the Regulations) and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations;
      • it is aware of the obligations regarding insider dealing in the Criminal Justice Act 1993, with all applicable provisions of FSMA, the EU Market Abuse Regulation 596/2014 and the Proceeds of Crime Act 2002 and confirms that it has and will continue to comply with those obligations;
      • the allocation, allotment, issue and delivery to it, or the person specified by it for registration as a holder of Placing Shares, will not give rise to a stamp duty or stamp duty reserve tax liability under any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary receipts and clearance services) and that no instrument under which it subscribes for Placing Shares (whether as principal, agent or nominee) would be subject to stamp duty or the increased rates referred to in those sections and that it, or the person specified by it for registration as a holder of Placing Shares, is not participating in the Placing as nominee or agent for any person or persons to whom the allocation, allotment, issue or delivery of Placing Shares would give rise to such a liability;
      • it, or the person specified by it for registration as a holder of the Placing Shares, will be liable for any stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto), if any, payable on acquisition of any of the Placing Shares or the agreement to subscribe for the Placing Shares and acknowledges and agrees that none of GMP FirstEnergy, Numis, Pareto, the Company, any of their respective Affiliates or any person acting on behalf of them will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement.  Each Placee and any person acting on behalf of such Placee agrees to participate in the Placing, and agrees to indemnify the Company, GMP FirstEnergy, Numis and Pareto on an after tax basis in respect of the same, on the basis that the Placing Shares will be allotted to the CREST stock account of Numis or Pareto (as applicable) who will hold them as nominee on behalf of such Placee until settlement in accordance with its standing settlement instructions;
      • none of GMP FirstEnergy, Numis, Pareto, any of their Affiliates or any person acting on behalf of any of them has or shall have any liability for any information, representation or statement contained in this Announcement or for any information previously published by or on behalf of the Company or any other written or oral information made available to or publicly available or filed information or any representation, warranty or undertaking relating to the Company, and will not be liable for its decision to participate in the Placing based on any information, representation, warranty or statement contained in this Announcement or elsewhere, provided that nothing in this paragraph shall exclude any liability of any person for fraud;
      • none of the Company, , GMP FirstEnergy, Numis, Pareto, any of their Affiliates or any person acting on behalf of any of them, is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing and that its participation in the Placing is on the basis that it is not and will not be a client of GMP FirstEnergy, Numis or Pareto and that GMP FirstEnergy, Numis and Pareto have no duties or responsibilities to it for providing the protections afforded to its clients or customers under the rules of the FCA, for providing advice in relation to the Placing, in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement or for the exercise or performance of any of its rights and obligations thereunder, including any rights to waive or vary any conditions or exercise any termination right;
      • in order to ensure compliance with the the PCMLTFA and Money Laundering Regulations 2017, GMP FirstEnergy, Numis and Pareto (for themselves and as agents on behalf of the Company) or the Company's registrars may, in their absolute discretion, require verification of its identity.  Pending the provision to GMP FirstEnergy, Numis, Pareto or the Company's registrars, as applicable, of evidence of identity, definitive certificates in respect of the Placing Shares may be retained at GMP FirstEnergy’s, Numis’ and Pareto’s absolute discretion or, where appropriate, delivery of the Placing Shares to it in uncertificated form, may be retained atGMP FirstEnergy’s, Numis’, Pareto’s or the Company's registrars', as the case may be, absolute discretion.  If within a reasonable time after a request for verification of identityGMP FirstEnergy, Numis or Pareto (as applicable) (for itself and as agent on behalf of the Company) or the Company's registrars have not received evidence satisfactory to them, GMP FirstEnergy, Numis, Pareto and/or the Company (in respect of the Placing) may, at their absolute discretion, terminate its commitment in respect of the Placing, in which event the monies payable on acceptance of allotment will, if already paid, be returned without interest to the account of the drawee's bank from which they were originally debited;
      • GMP FirstEnergy, Numis and Pareto may, and their Affiliates acting as an investor for its or their own account(s) may, subscribe for Placing Shares and, in that capacity may retain, purchase, offer to sell or otherwise deal for its or their own account(s) in the Placing Shares, any other securities of the Company or other related investments in connection with the Placing or otherwise.  Accordingly, references in this Announcement to the Placing Shares being offered, subscribed, acquired or otherwise dealt with should be read as including any offer to, or subscription, acquisition or dealing by, GMP FirstEnergy, Numis, Pareto and/or any of their respective Affiliates acting as an investor for its or their own account(s).  None ofGMP FirstEnergy, Numis or Pareto nor the Company intend to disclose the extent of any such investment or transaction otherwise than in accordance with any legal or regulatory obligation to do so;
      • these terms and conditions and any agreements entered into by it pursuant to these terms and conditions, and all non-contractual or other obligations arising out of or in connection with them, shall be governed by and construed in accordance with the laws of England and Wales and it submits (on behalf of itself and on behalf of any person on whose behalf it is acting) to the exclusive jurisdiction of the English courts as regards any claim, dispute or matter arising out of any such contract, except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with any interest chargeable thereon) may be taken by the Company, GMP FirstEnergy, Numis or Pareto in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange;
      • the Company, GMP FirstEnergy, Numis and Pareto and their respective Affiliates and others will rely upon the truth and accuracy of the foregoing agreements, acknowledgements, representations, warranties and undertakings which are given toGMP FirstEnergy, Numis and Pareto, on their own behalf and on behalf of the Company, and are irrevocable;
      • it irrevocably appoints any duly authorised officer ofGMP FirstEnergy, Numis or Pareto as agent for the purpose of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares for which it agrees to subscribe upon the terms of this Announcement;
      • it will indemnify on an after tax basis and hold the Company, GMP FirstEnergy, Numis, Pareto and their respective Affiliates harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, undertakings, agreements and acknowledgements in this Appendix and further agrees that the provisions of this Appendix shall survive after completion of the Placing;
      • (i) it has knowledge and experience in financial, business and international investment matters and is required to evaluate the merits and risks of subscribing for or purchasing the Placing Shares; (ii) it is experienced in investing in securities of this nature and is aware that it may be required to bear, and is able to bear, the economic risk of, and is able to sustain a complete loss in connection with the Placing; and (iii) it has relied upon its own examination and due diligence of the Company and its associates taken as a whole, and the terms of the Placing, including the merits and risks involved and has satisfied itself concerning the relevant tax, legal, currency and other economic consideration relevant to its acquisition of Placing Shares;
      • none of the Company, GMP FirstEnergy, Numis or Pareto are making any undertaking or warranty to any Placee regarding the legality of an investment in the Placing Shares by such Placee under any legal, investment or similar laws or regulations; and
      • its commitment to subscribe for Placing Shares on the terms set out herein and in the contract note will continue notwithstanding any amendment that may in future be made to the terms of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's conduct of the Placing.
    • The representations, warranties, acknowledgements and undertakings contained in this Appendix are given to the Company and toGMP FirstEnergy, Numis and Pareto for themselves and on behalf of the Company and are irrevocable.
    • Placees should note that they will be liable for any stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the United Kingdom by them or any other person on the subscription by them of any Placing Shares or the agreement by them to subscribe for any Placing Shares.
    • Each Placee, and any person acting on behalf of the Placee, acknowledges and agrees that none ofGMP FirstEnergy, Numis or Pareto owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings or indemnities in the Placing Agreement.
    • When a Placee or person acting on behalf of the Placee is dealing withGMP FirstEnergy, Numis or Pareto, any money held in an account withGMP FirstEnergy, Numis or Pareto (as applicable) on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the rules and regulations of the FCA made under FSMA.  The Placee acknowledges and agrees that the money will not be subject to the protections conferred by the client money rules; as a consequence, this money will not be segregated fromGMP FirstEnergy’s, Numis’ or Pareto’s money (as applicable) in accordance with the client money rules and will be used byGMP FirstEnergy, Numis or Pareto in the course of its own business; and the Placee will rank only as a general creditor ofGMP FirstEnergy, Numis or Pareto (as applicable).
    • Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser.
    • Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.
    • All times and dates in this Announcement may be subject to amendment. GMP FirstEnergy, Numis and Pareto shall notify the Placees and any person acting on behalf of a Placee of any changes.

 


Result of Placing

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, JAPAN, NEW ZEALAND, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE: (A) A PROSPECTUS OR OFFERING MEMORANDUM; (B) AN ADMISSION DOCUMENT PREPARED IN ACCORDANCE WITH THE AIM RULES; OR (C) AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.  THIS ANNOUNCEMENT DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES OF PETROTAL CORP. IN ANY JURISDICTION IN WHICH ANY SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL. 

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY THE COMPANY TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION (REGULATION 596/2014/EU). UPON PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

31 May 2019

PetroTal Corp.

Result of Placing

Capitalised terms used in this announcement (the “Announcement”) have the meanings given to them in the announcement made at 9.07 a.m. on 31 May 2019 regarding, inter alia, the proposed placing (the “Placing Announcement”), unless the context provides otherwise. 

PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL and AIM: PTAL), an independent oil and gas company with assets and operations in Peru, is pleased to announce that further to the Placing Announcement released earlier today, the Bookbuild has been successful and is now closed.

In order to satisfy demand from investors, but without causing undue dilution to existing Shareholders, the Company has increased the size of the Placing.

The Company has successfully placed 133,333,333 new Common Shares at a Placing Price of 15 pence per share, raising gross proceeds of £20 million.

The Placing was significantly oversubscribed and the book is principally comprised of new UK institutional Shareholders. GMP FirstEnergy, Numis and Pareto acted as the Joint Bookrunners in relation to the Placing.  Strand Hanson acted as Nominated & Financial Adviser to the Company on the Placing.

Manolo Zúñiga, President and CEO of PetroTal commented:

“We are delighted with the results of the Placing, for which we received demand for almost twice the initial base deal, and would like to thank our investors for their participation.  We particularly welcome the new institutions who have joined the Company today. The capital raised will allow PetroTal to pursue the full development of our Bretaña oilfield where we anticipate reaching production in excess of 10,000 bopd by the year end.”

Admission to trading and total voting rights

Application has been made to the London Stock Exchange for the admission Placing Shares to trading on AIM. It is expected that Admission will occur and that dealings in the Placing Shares will commence at 8.00 a.m. on 5 June 2019.

Following the issue of the Placing Shares, the Company will have 610,074,324 Common Shares in issue and there are no shares held in treasury. Accordingly, this figure will be the total number of voting rights in the Company and may be used by Shareholders as the denominator for the calculations by which they determine if they are required to notify their interest in, or change to their interest in, the Company under the FCA’s Disclosure Guidance and Transparency Rules.

ENDS 

CONTACT DETAILS:

PetroTal Corp.

Manuel (Manolo) Pablo Zúñiga-Pflücker (President and CEO)

Greg Smith (EVP and CFO)

 Tel: +1 713 609 9101
Strand Hanson Limited

(Nominated & Financial Adviser)

James Spinney / Ritchie Balmer / Eric Allan

Tel: +44 (0) 20 7409 3494
GMP FirstEnergy

(Joint Bookrunner and Joint Broker)

Jonathan Wright / Hugh Sanderson

 Tel: +44 (0) 20 7448 0200
Numis Securities Limited

(Joint Bookrunner and Joint Broker)

John Prior / Emily Morris

Tel: +44 (0) 20 7260 1000

 

Pareto Securities Limited

(Joint Bookrunner)

Soren Clausen

Tel: +44 (0) 20 7786 4370
Celicourt Communications

(Financial PR)

Mark Antelme / Jimmy Lea

 Tel: +44 (0) 20 7520 9261

Notes to Editors:

PetroTal is a publicly-traded, dual-listed (TSX-V: TAL and AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's development asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018. Additionally, the Company has large exploration prospects and is engaged in finding a partner to drill the Osheki prospect in Block 107. The Company's management team has significant experience in developing and exploring for oil in Northern Peru and is led by a Board of Directors that is focused on safely and cost effectively developing and exploiting the Bretaña oil field.  More information on the Company can be found at www.PetroTal-Corp.com.

IMPORTANT NOTICE

THIS ANNOUNCEMENT AND THE INFORMATION IN IT, IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, NEW ZEALAND, JAPAN OR SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED INVESTORS AS DEFINED IN SECTION 2(7) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000, AS AMENDED, (QUALIFIED INVESTORS) BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE EU PROSPECTUS DIRECTIVE (WHICH MEANS DIRECTIVE 2003/71/EC AND INCLUDES ANY RELEVANT IMPLEMENTING DIRECTIVE MEASURE IN ANY MEMBER STATE) (THE PROSPECTUS DIRECTIVE); AND (B) IN THE UNITED KINGDOM, TO QUALIFIED INVESTORS WHO ARE PERSONS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(1) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE ORDER); (II) ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC") OF THE ORDER; OR (III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS IN (A) OR (B) TOGETHER BEING REFERRED TO AS RELEVANT PERSONS).

THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVENT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that the Placing Shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, Placees should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing.  Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Bookrunners will only procure investors who meet the criteria of professional clients and eligible counterparties.  For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.

In this Announcement, unless the context requires, Placee means a Relevant Person (including individuals, funds or others) who has been invited to, and who chooses to, participate in the Placing and by whom or on whose behalf a commitment to subscribe for Placing Shares has been given.

No representation or warranty, express or implied, is made or given by or on behalf of the Company,  GMP FirstEnergy, Numis or Pareto, or any of their respective Affiliates  or any of such persons' directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this Announcement and no liability whatsoever is accepted by the Company, GMP FirstEnergy, Numis or Pareto or any of such persons' Affiliates, directors, officers or employees or any other person for any loss howsoever arising, directly or indirectly, from any use of such information or opinions or otherwise arising in connection therewith.

This Announcement does not constitute an offer to sell or issue or the solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction in which such offer or solicitation is or may be unlawful.

Without prior written approval of the TSXV and compliance with all applicable Canadian securities laws, the Placing Shares may not be sold, transferred, hypothecated or otherwise traded on or through the facilities of TSXV or otherwise in Canada or to or for the benefit of a Canadian resident until the date that is four months and a day after the date of issuance.

The relevant clearances have not been, nor will they be, obtained from the securities commission of any province or territory of Canada; no prospectus has been lodged with or registered by, the Australian Securities and Investments Commission or the Japanese Ministry of Finance; and the Placing Shares have not been, nor will they be, registered or qualified for distribution, as applicable under or offered in compliance with the securities laws of any state, province or territory of United States, Australia, New Zealand, Canada, Japan or South Africa. Accordingly, the Placing Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into the United States, Australia, New Zealand, Canada, Japan or South Africa or any other jurisdiction outside the United Kingdom.

GMP FirstEnergy, Numis and Pareto are each authorised and regulated in the United Kingdom by the FCA, and are each acting exclusively for the Company and no one else in connection with the matters referred to in this Announcement and will not be responsible to anyone other than the Company for providing the protections afforded to the customers of GMP FirstEnergy, Numis and Pareto or for providing advice in relation to the matters described in this Announcement.

Persons distributing any part of this Announcement must satisfy themselves that it is lawful to do so. Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this Announcement should seek appropriate advice before taking any action. Persons into whose possession this Announcement comes are required by the Company,  GMP FirstEnergy, Numis and Pareto to inform themselves about, and observe, any such restrictions.

This Announcement does not constitute a recommendation concerning any investors' options with respect to the Placing. Investors and prospective investors should conduct their own investigation, analysis and evaluation of the business and data described in this Announcement. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The contents of this Announcement are not to be construed as legal, business, financial or tax advice. Each investor or prospective investor should consult his, her or its own legal adviser, business adviser, financial adviser or tax adviser for legal, financial, business or tax advice.

This Announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the Placing Shares. Any investment decision to subscribe for Placing Shares in the Placing a must be made solely on the basis of publicly available information, which has not been independently verified by  GMP FirstEnergy, Numis and/or Pareto.

The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than the AIM Market of the London Stock Exchange (AIM) and the TSXV.


PetroTal Announces Approval of Environmental Impact Assessment to Develop the Bretaña Oil Field and Signs Pipeline Contract with PetroPeru

Calgary and HoustonMay 29, 2019—PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL and AIM: PTAL), a development and production company focused on oil assets in Peru, is pleased to announce the Company has received approval of the Environmental Impact Assessment (“EIA”) to fully develop the Bretaña oil field in Block 95.  The Company also signed a contract with PetroPeru for access to the existing pipeline for transport of crude oil to commercial markets.

The approval of the EIA sets the stage for PetroTal to continue with the full field development of the Bretaña oil field, and allows the Company to fully develop its reserves. The EIA provides the authorization to drill future development wells and install needed production equipment and facilities. The EIA also sets forth the work needed to return the field to its original condition at the end of the license contract, including the safe and environmentally responsible removal of facilities and reforestation of the affected lands.

Additionally, the Company signed a contract with PetroPeru, the State owned oil company, who operates the North Peruvian Pipeline (“ONP”) to deliver oil to the Pacific coast via the pipeline.  The contract is important to efficiently access commercial markets for the Company’s production.  PetroTal currently sends oil to multiple markets via barges and trucks, however the use of the pipeline mitigates potential production constraints. The Company plans to access the ONP once it reaches 5,000 barrels of oil per day (“BOPD”) by mid year.

Manolo Zuniga, President and Chief Executive Officer, said:

“I personally congratulate the team in Lima who have worked diligently over the past year and a half to finalize this permit to develop the field and execute the ONP contract. It is a testament to the professional staff we have and the regard for safe and efficient operations that brought this to the finish line. Additionally, we want to thank each and every person who reviewed and commented at various levels of the government along the way. It is clear that our team here at PetroTal, most of whom are Peruvian, are working in the best interest of every stakeholder, from the government to employees, to shareholders, and the communities in which we work. PetroTal has a commitment to environmentally safe and efficient development of the assets that we have been tasked to develop. Furthermore, to sign the contract for use of the pipeline allows us to continue ramping production for the next several months. We have been working diligently to sign this agreement before bringing total Bretaña field production to 5,000 BOPD by mid-year, both of which are key milestones for PetroTal.”

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐listed (TSX‐V: TAL and AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's development asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018. Additionally, the Company has large exploration prospects and is engaged in finding a partner to drill the Osheki prospect in Block 107. The Company's management team has significant experience in developing and exploring for oil in Northern Peru and is led by a Board of Directors that is focused on safely and cost effectively developing and exploiting the Bretaña oil field. More information on the Company can be found at www.PetroTal‐Corp.com.

For further information, please contact:

Greg Smith
Executive Vice President and Chief Financial Officer
Gsmith@Petrotal-Corp.com

T: (713) 609-9101

Manolo Zuniga
President and Chief Executive Officer
Mzuniga@Petrotal-Corp.com
T : (713) 609-9101

Mark Antelme / Jimmy Lea
Celicourt Communications
petrotal@celicourt.uk
T : 44 207 520 9261

James Spinney / Ritchie Balmer / Eric Allan
Strand Hanson Limited (Nominated & Financial Adviser)
T: 44 (0) 207 409 3494

John Prior / Emily Morris / George Price
Numis Securities Limited (Joint Broker)
T: +44 (0) 207 260 1000

Jonathan Wright / Hugh R. Sanderson
GMP FirstEnergy (Joint Broker)
T: +44 (0) 20 7448 0200

FORWARD-LOOKING STATEMENTS: This press release may contain certain statements that may be deemed to be forward-looking statements. Such statements relate to possible future events, including, but not limited to PetroTal’s business strategy, objectives, strength and focus and the impact of the declaration of commerciality in respect of the Bretaña oil field. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “believe”, “expect”, “plan”, “estimate”, “potential”, “will”, “should”, “continue”, “may”, “objective” and similar expressions. In addition, statements relating to expected production, reserves, resources, recovery, costs and valuation are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves and resources described can be profitably produced in the future. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, reservoir characteristics, recovery factor, exploration upside, prevailing commodity prices and the actual prices received for PetroTal’s products, the availability and performance of drilling rigs, facilities, pipelines, other oilfield services and skilled labour, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the accuracy of PetroTal’s geological interpretation of its drilling and land opportunities, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of new wells, the Company’s growth strategy, general economic conditions, availability of required equipment and services and prevailing commodity prices. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), commodity price and exchange rate fluctuations, legal, political and economic instability in Peru, access to transportation routes and markets for the Company’s production, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Please refer to the risk factors identified in the Company’s annual information form for the year ended December 31, 2017 and management’s discussion and analysis for the three and nine months ended September 30, 2018, which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.


PetroTal Announces First Quarter Financial Results and Operations Update

Calgary, Alberta and Houston, TexasMay 28, 2018—PetroTal Corp. (“Petrotal” or the “Company”) (TSX-V: TAL and AIM: PTAL) is pleased to provide a summary of its financial and operating results for the three months ended March 31, 2019.

Selected financial and operational information is outlined below and should be read in conjunction with the Company’s unaudited consolidated financial statements (“Financial Statements”) and management’s discussion and analysis (“MD&A”) for the three months ended March 31, 2019, which are available on SEDAR at www.sedar.com and the Company’s website at www.petrotal-corp.com.  Reserves numbers presented herein were derived from an independent reserves report (the “NSAI Report”) prepared by Netherland, Sewell & Associates, Inc. (“NSAI”) effective December 31, 2018. All figures referred to in this press release are denominated in U.S. dollars.

2019 FIRST QUARTER HIGHLIGHTS

  • Produced approximately 85,000 barrels of oil during the first quarter
  • Successfully mobilized the drilling rig to the drilling pad at Bretaña to begin drilling the BN 95-2-2-2XD well in February
  • Increased the net present value discounted to 10 percent (“NPV10”) of the Company’s proved plus probable (“2P”) reserves year over year by 90 percent to $535 million as of December 31, 2018

OPERATIONS UPDATE

The Company continued the initial testing phase at the Bretaña oil field and produced an average of 944 barrels of oil per day (“BOPD”) during the quarter.  The Company mobilized a drilling rig to the Bretaña field to begin development and appraisal.  The Company successfully drilled and completed the BN 95-2XD well in the northern section of the field.  As previously reported, the well came online at 2,250 BOPD and over the past 30 days averaged over 2,300 BOPD.  The follow up well, BN 95-3H was spud on April 21, 2019 and the Company is currently drilling the horizontal section of the well. The BN 95-3H is being drilled to the offset side of the northern portion of the field and will be completed as a horizontal well in the Vivian formation.

Manolo Zuniga, President and Chief Executive Officer stated:

The first quarter was all about execution and the team did an excellent job delivering the first well on time and on budget.  We continue to drill the third oil producer which will be PetroTal’s first horizontal completion.  We have a lot to accomplish this year but we are well on the way to hitting the mid-year production target of 5,000 BOPD.  And finally, the NSAI Report  showed a year over year increase of 90 percent increase in 2P NPV-10 to $535 million; driven mostly by the team recommending using our own produced crude oil for power generation thus reducing operating expenses going forward.  We are pleased with the results to date, and we are prepared for what will be a very active middle and second half of the year.”   

FINANCIAL HIGHLIGHTS

The following table summarizes key financial highlights associated with the Company’s financial performance. See the Financial Statements and the MD&A for further details.

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐listed (TSX‐V: TAL and AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's development asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018. Additionally, the Company has large exploration prospects and is engaged in finding a partner to drill the Osheki prospect in Block 107. The Company's management team has significant experience in developing and exploring for oil in Northern Peru and is led by a Board of Directors that is focused on safely and cost effectively developing and exploiting the Bretaña oil field.  More information on the Company can be found at www.PetroTal‐Corp.com.

For further information, please contact:

Greg Smith
Executive Vice President and Chief Financial Officer
Gsmith@Petrotal-Corp.com
T: (713) 609-9101

Manolo Zuniga
President and Chief Executive Officer
Mzuniga@Petrotal-Corp.com
T : (713) 609-9101

Mark Antelme / Henry Lerwill
Celicourt Communications
petrotal@celicourt.uk
T : 44 207 520 9261

James Spinney / Ritchie Balmer / Eric Allan
Strand Hanson Limited (Nominated & Financial Adviser)
T: 44 (0) 207 409 3494

John Prior / Emily Morris / George Price
Numis Securities Limited (Joint Broker)
T: +44 (0) 207 260 1000

Jonathan Wright / Hugh R. Sanderson
GMP FirstEnergy (Joint Broker)
T: +44 (0) 20 7448 0200

READER ADVISORIES 

FORWARD-LOOKING STATEMENTS: This press release may contain certain statements that may be deemed to be forward-looking statements. Such statements relate to possible future events, including, but not limited to the Company’s objectives; the Company’s proposed drilling, completions and other activities and the anticipated results of such activities; cost controls and savings; anticipated future production and revenue; future development and growth prospects.  In addition, statements relating to expected production, reserves, recovery, costs and valuation are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “believe”, "expect", “plan”, “estimate”, “potential”, “will”, “should”, “continue”, “may”, “objective” and similar expressions.  The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, reservoir characteristics, recovery factor, exploration upside,  prevailing commodity prices and the actual prices received for PetroTal’s products, the availability and performance of drilling rigs, facilities, pipelines, other oilfield services and skilled labour, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the accuracy of PetroTal’s geological interpretation of its drilling and land opportunities, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of new wells, the Company’s growth strategy, general economic conditions, availability of required equipment and services and prevailing commodity prices. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), commodity price and exchange rate fluctuations, legal, political and economic instability in Peru, access to transportation routes and markets for the Company’s production, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Please refer to the risk factors identified in the Company’s MD&A and annual information form for the year ended December 31, 2018 which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

OIL AND GAS INFORMATION: The NSAI Report was prepared by NSAI, an independent qualified reserves evaluator, in accordance with the standards contained in the Canadian Oil and Gas Evaluation Handbook (the “COGE Handbook”) and the reserve definitions contained in National Instrument 51‐101 – Standards of Disclosure for Oil and Gas Activities (“NI 51‐101”).

References in this press release to production test rates, initial test production rates, and other short-term production rates are useful in confirming the presence of hydrocarbons, however such rates are not determinative of the rates at which such wells will commence production and decline thereafter and are not indicative of long term performance or of ultimate recovery. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for PetroTal. A pressure transient analysis or well-test interpretation has not been carried out in respect of all wells. Accordingly, the Company cautions that the test results should be considered to be preliminary.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, “FOFI”) about PetroTal’s prospective results of operations, production, NPV10 and components thereof, all of which are subject to the same assumptions, risk factors, limitations and qualifications as set forth in the above paragraphs. FOFI contained in this press release was approved by management as of the date of this press release and was provided for the purpose of providing further information about PetroTal’s anticipated future business operations. PetroTal disclaims any intention or obligation to update or revise any FOFI contained in this press release, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein. All FOFI contained in this press release complies with the requirements of Canadian securities legislation, including NI 51-101.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.


PetroTal Provides Update on Earthquake Affecting Northern Peru

Calgary and HoustonMay 27, 2019—PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL), a development and production company focused on oil assets in Peru, is providing an update to the earthquake that struck Northern Peru on Sunday May, 26, 2019.

The Company was notified that no injuries were sustained by personnel at the Bretana oil field,  and the drilling and production teams report no impact to the operations.  The Bretana platform was engineered to be able to withstand situations such as this. The Company is currently conducting tests to drilling and production equipment to assure safe and efficient operations.

PetroTal, through its Corporate Social Responsibility (“CSR”) team, is reaching out to the surrounding communities to assess damage.  PetroTal is committed to assuring that our operations are safe and environmentally secure, as well as providing assistance to the local communities.

Manolo Zuniga, President and Chief Executive Officer, said:

“PetroTal’s operations are ongoing as normal.  This includes our drilling of the BN 95-3H well as well as production from the two oil wells at the location.  We are concerned about the local communities and the damage they may have suffered, but I am extremely proud of our CSR team who acted immediately to initiate contact, assess damage, and provide assistance as we can to the local people.”

ABOUT PETROTAL

PetroTal is a publicly-traded independent oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru.  The Company’s management team has significant experience in developing oil fields in Northern Peru and is focused on safely and cost effectively developing and exploiting the Bretaña oil field in Block 95 and to continue to evaluate the Osheki prospect in Block 107.

For further information, please contact:

Greg Smith
Executive Vice President and Chief Financial Officer
Gsmith@Petrotal-Corp.com
T: (713) 609-9101

Manolo Zuniga
President and Chief Executive Officer
Mzuniga@Petrotal-Corp.com
T : (713) 609-9101

Mark Antelme / Henry Lerwill
Celicourt Communications
petrotal@celicourt.uk
T : 44 207 520 9261

James Spinney / Ritchie Balmer / Eric Allan
Strand Hanson Limited (Nominated & Financial Adviser)
T: 44 (0) 207 409 3494

John Prior / Emily Morris / George Price
Numis Securities Limited (Joint Broker)
T: +44 (0) 207 260 1000

Jonathan Wright / Hugh R. Sanderson
GMP FirstEnergy (Joint Broker)
T: +44 (0) 20 7448 0200

READER ADVISORIES 

FORWARD-LOOKING STATEMENTS: This press release may contain certain statements that may be deemed to be forward-looking statements. Such statements relate to possible future events, including, but not limited to PetroTal’s business strategy, objectives, strength and focus and the impact of the declaration of commerciality in respect of the Bretana oil field. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “believe”, “expect”, “plan”, “estimate”, “potential”, “will”, “should”, “continue”, “may”, “objective” and similar expressions. In addition, statements relating to expected production, reserves, resources, recovery, costs and valuation are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves and resources described can be profitably produced in the future. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, reservoir characteristics, recovery factor, exploration upside, prevailing commodity prices and the actual prices received for PetroTal’s products, the availability and performance of drilling rigs, facilities, pipelines, other oilfield services and skilled labour, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the accuracy of PetroTal’s geological interpretation of its drilling and land opportunities, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of new wells, the Company’s growth strategy, general economic conditions, availability of required equipment and services and prevailing commodity prices. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), commodity price and exchange rate fluctuations, legal, political and economic instability in Peru, access to transportation routes and markets for the Company’s production, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Please refer to the risk factors identified in the Company’s annual information form for the year ended December 31, 2017 and management’s discussion and analysis for the three and nine months ended September 30, 2018, which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.


PetroTal Announces Fiscal Year-end Financial Results and Operations Update

Calgary, Alberta and Houston, Texas April 24, 2019—PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL and AIM: PTAL) is pleased to provide a summary of its 2018 year-end financial and operating results.

Selected financial, reserves and operational information is outlined below and should be read in conjunction with the Company’s audited consolidated financial statements (“Financial Statements”), management’s discussion and analysis (“MD&A”) and annual information form (“AIF”) for the year ended December 31, 2018, which are available on SEDAR at www.sedar.com and the Company’s website at www.PetroTal-Corp.com. Reserves numbers presented herein were derived from an independent reserves report (the “NSAI Report”) prepared by Netherland, Sewell & Associates, Inc. (“NSAI”) effective December 31, 2018. All figures referred to in this press release are denominated in U.S. dollars.

2018 HIGHLIGHTS

  • Commenced operation of Bretaña oil field assets, bringing the field on production in five months;
  • Completed the Long-Term Testing facility installation and initiated production, 25 percent under budget;
  • Full field oil production facilities brought online in October 2018;
  • Declared commercialty in the Bretaña field in November 2018;
  • 176,000 barrels (“bbl”) of oil produced during 2018, and approximately 280,000 barrels to date;
  • Proved (“1P”) Reserves estimated at approximately 17.9 million(1) bbl of oil gross;
  • Proved + Probable (“2P”) Reserves estimated at approximately 39.4 million(1) bbl of oil gross;
  • Proved + Probable + Possible (“3P”) Reserves estimated at approximately 78.7 million(1) bbl of oil gross;
  • Pre-tax NPV-10 of approximately $535 million for 2P Reserves and $1.25 billion for 3P Reserves; and
  • 2P Reserves NPV-10 increase of 90%.

Note:

  1. Reserves include a total of approximately 2,963.6 Mbbl (3P) of oil for surface facility use across all categories (960.7 Mbbl (1P) and 1,818.2 Mbbl (2P)). See “Summary of Oil Reserves and Net Present Values as of December 31, 2018” for a summary of Company reserves, which exclude these amounts.

OPERATIONS UPDATE

The Company’s objective of developing the Bretaña oil field on a modular basis and putting the field online by year-end 2018 was accomplished ahead of schedule and under budget.  Although the Company initially estimated the process to bring the field online would take 10-12 months and approximately $24 million in capital costs, it was accomplished in five months for a total capital cost of approximately $18 million.  In October, the field’s first phase oil production facilities were installed on time and within budget.  The Company was able to declare commerciality in Bretaña with the achievement of sustained production operations.  PetroTal successfully completed a secondary listing on the AIM Market of the London Stock Exchange, with first trading on December 24, 2018.  The year-end oil reserves, which were previously announced on April 11, 2019, are summarized in the charts below.

 

2018 YEAR-END RESERVES SUMMARY

The summary below sets forth PetroTal’s reserves as at December 31, 2018, as presented in the NSAI Report. The figures in the following tables have been prepared in accordance with the standards contained in the Canadian Oil and Gas Evaluation Handbook (the “COGE Handbook”) and the reserve definitions contained in National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (“NI 51-101”). In addition to the summary information disclosed in this press release, more detailed information is included in the AIF.

The reserves estimated by NSAI on the charts below exclude up to three million barrels that are expected to be used for power generation in the field.

Company

Heavy Oil Reserves(2)

(Mbbl)(1)

Future Net Revenue

Before Income Taxes (USM$)(4)(5)(6)

Category Gross Net Discounted at 0% Discounted at 5% Discounted at 10% Discounted at 15% Discounted at 20%
Proved Developed Producing

Proved Undeveloped

1,559.0

15,378.5

1,559.0

15,378.5

75,696.3

202,879.9

61,506.5

143,618.9

51,624.6

99,380.2

44,472.9

66,606.6

39,112.0

42,129.6

Total Proved 16,937.5 16,937.5 278,576.2 205,125.4 151,004.8 111,079.5 81,241.6
Probable Undeveloped 20,597.8 20,597.8 772,240.6 523,525.2 384,528.6 299,631.9 243,749.6
Proved + Probable 37,535.4 37,535.4 1,050,816.8 728,650.6 535,533.4 410,711.4 324,991.2
Possible Undeveloped 38,278.9 38,278.9 1,684,251.1 1,060,626.2 718,814.0 516,783.2 389,791.8
Proved + Probable + Possible 75,814.2 75,814.2 2,735,067.9 1,789,276.8 1,254,347.5 927,494.6 714,783.0

Notes:

  1. Totals may not add because of rounding. Mbbl are thousands of barrels.
  2. PetroTal owns a 100 percent company gross interest and a 100 percent company net interest in these properties. Company reserves exclude a total of approximately 2,963.6 Mbbl (3P) of oil for surface facility use across all categories (960.7 Mbbl (1P) and 1,818.2 Mbbl (2P)).
  3. Net reserves do not include deductions for royalty expenses for net oil volumes; government royalties are included in property and mineral taxes.
  4. Based on NSAI’s December 31, 2018 escalated price forecast. See “Summary of Pricing and Inflation Rate Assumptions – Forecast Prices and Costs”.
  5. It should not be assumed that the undiscounted or discounted net present value of future net revenue attributable to the Company’s reserves estimated by NSAI represent the fair market value of those reserves.
  6. All future net revenues are estimated using forecast prices and cost assumptions, arising from the anticipated development and production of reserves, after the deduction of royalties, operating costs, development costs and abandonment and reclamation costs but before consideration of indirect costs such as administrative, overhead and other miscellaneous expenses. There is no assurance that the forecast prices and costs assumptions will be attained, and variances could be material. The recovery and reserve estimates of the Company’s reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered.  Actual reserves may be greater than or less than the estimates provided herein.

SUMMARY OF PRICING AND INFLATION RATE ASSUMPTIONS – FORECAST PRICES AND COSTS

The forecast cost and price assumptions assume increases in wellhead selling prices and include inflation with respect to future operating and capital costs. Crude oil benchmark reference pricing, inflation and exchange rates utilized by NSAI as at December 31, 2018 were as follows:

Period Ending Oil Price (US$/BBL)
12-31-2019 63.88
12-31-2020 68.20
12-31-2021 70.98
12-31-2022 73.35
12-31-2023 75.40
12-31-2024 77.35
12-31-2025 79.40
12-31-2026 81.61

Thereafter, escalated 2 percent on January 1 of each year.

Future Development Costs

The following information sets forth development costs deducted in the estimation of PetroTal’s future net revenue attributable to the reserve categories noted below:

  • Proved $178.0 million
  • Proved + Probable $251.1 million
  • Proved + Probable + Possible $368.8 million

The future development costs are estimates of capital expenditures required in the future for PetroTal to convert the corresponding reserves to proved developed producing reserves.

In 2019, the Company drilled and completed a second oil producing well at Bretaña, the BN 95-2-2-2XD, on time and within budget.  The well came online at approximately 2,250 bbl of oil per day (“BOPD”) in a vertical completion in the Vivian formation.  The well, which reached total depth on April 9, 2019, was completed as an oil producer in the Vivian formation in the northern portion of the Bretaña structure.  The well was brought online at an initial rate of approximately 2,250 barrels of oil per day (“BOPD”). This is an early production rate and more detailed production data will be announced in due course.  The team also spud a third oil development well, the BN-95-3H, which will be a horizontal producer in the Vivian formation, and which is expected to come online in mid-June.

Manolo Zuniga, PetroTal’s President and Chief Executive Officer, stated:

“We are executing on multiple fronts and in 2018 we accomplished many milestones that will set the Company up for future success and growth.  Our operations team has been hitting on all cylinders, bringing the field online early, either on or under budget, and moving into commercial production at year end.  Our reserves report showed a significant increase in present value across all reserve categories.  With our 2P pre-tax NPV-10 at approximately $535 million, we have grown the value to our stakeholders by 90 percent.”

“To date in 2019 we have drilled and completed the second producing oil well at Bretaña, having come online only one week ago at 2,250 BOPD.  This rate was over the course of five days and we will provide more detail on the well and its production when we have sustained production data, to allow for a better stabilized rate.  We have moved on with the spud of the third oil producing well which we expect to be online in mid-June.  The original producer is still producing approximately 800 BOPD, in line with our internal expectations due to normal declines expected as water is produced from the aquifer that is the main drive mechanism for the Vivian formation.”

NEAR AND MEDIUM-TERM OBJECTIVES

  • Drill and complete up to four wells to materially contribute to production totals in 2019;
  • Install phase two production facilities in the field with oil production capacity of 10,000 BOPD;
  • Secure farm-out partner and drill high impact Osheki exploration well on Block 107;
  • Continue Bretaña development drilling and install future phases of production facilities; and
  • Look for strategic and synergistic acquisitions to expand the Company’s asset base in Peru.

FINANCIAL HIGHLIGHTS

The following table summarizes key financial highlights associated with the Company’s financial performance for the years ended December 31, 2018 and 2017. See the Financial Statements and MD&A for further details.

December 31, 2018
US$000s
December 31, 2017 US$000s
Net Revenues 9,994 -
Net Loss (4,621) (2,754)
Total Assets 96,097 98,766
Total Liabilities 18,570 16,723
Total Shareholders’ Equity 77,527 82,043

OTHER COMPANY UPDATES

Charles Fetzner, VP of Asset Development, resigned from the Company for personal family reasons effective as of April 18, 2019.  Mr. Fetzner was a founder of PetroTal LLC, the original private company, in December 2015 and was part of the new management team following the completion of PetroTal’s go-public transaction on December 18, 2017.

Mr. Zuniga commented “We wish Chuck and his family the best and we fully understand his desire to spend time with his family at this time.  Chuck was an integral part of our transition from a private company to public entity.  Mr. Estuardo Alvarez-Calderon, VP of Exploration and Production, will assume Chuck’s responsibilities which include the important Osheki farm-in process.  Again, we wish the Fetzner family the best.”

As previously announced on September 14, 2018 and October 31, 2018, the Corporation has issued an aggregate of 4,008,333 performance share units (“PSUs”) to certain officers of the Company.  The original terms of the PSUs provided for vested in equal tranches over three years. The Board of Directors has amended the terms of the PSUs to provide that the PSUs awarded to executives will vest three years from the date of issuance.  The Board believes the change to the vesting terms will strengthen the link between executive compensation and long-term shareholder value.

ABOUT PETROTAL

PetroTal is a publicly-traded, dual-listed (TSX-V: TAL and AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's development asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018. Additionally, the Company has large exploration prospects and is engaged in finding a partner to drill the Osheki prospect in Block 107. The Company's management team has significant experience in developing and exploring for oil in Northern Peru and is led by a Board of Directors that is focused on safely and cost effectively developing and exploiting the Bretaña oil field.  More information on the Company can be found at www.PetroTal-Corp.com.

For further information, please contact:

Greg Smith
Executive Vice President and Chief Financial Officer
Gsmith@Petrotal-Corp.com

T: (713) 609-9101

Manolo Zuniga
President and Chief Executive Officer
Mzuniga@Petrotal-Corp.com

T: (713) 609-9101

Mark Antelme / Henry Lerwill
Celicourt Communications (Financial PR)
petrotal@celicourt.uk
T: 44 (0) 207 520 9261

James Spinney / Ritchie Balmer / Eric Allan
Strand Hanson Limited (Nominated & Financial Adviser)
T: 44 (0) 207 409 3494

John Prior / Emily Morris / George Price
Numis Securities Limited (Joint Broker)
T: +44 (0) 207 260 1000

Jonathan Wright / Hugh R. Sanderson
GMP FirstEnergy (Joint Broker)
T: +44 (0) 20 7448 0200

 

READER ADVISORIES 

FORWARD-LOOKING STATEMENTS: This press release may contain certain statements that may be deemed to be forward-looking statements. Such statements relate to possible future events, including, but not limited to: PetroTal’s business strategy, objectives, strength and focus, including developing the Bretaña oil field on a modular basis; drilling and completion activities and the results of such activities; construction of production facilities; securing a farm-out partner in Osheki; future acquisitions; the ability of the Company to achieve drilling success consistent with management’s expectations; anticipated future production and revenue; and future development and growth prospects. All statements other than statements of historical fact may be forward-looking statements. In addition, statements relating to expected production, reserves, recovery, costs and valuation are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future.

Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “believe”, "expect", “plan”, “estimate”, “potential”, “will”, “should”, “continue”, “may”, “objective” and similar expressions. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, reservoir characteristics, recovery factor, exploration upside,  prevailing commodity prices and the actual prices received for PetroTal’s products, the availability and performance of drilling rigs, facilities, pipelines, other oilfield services and skilled labour, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the accuracy of PetroTal’s geological interpretation of its drilling and land opportunities, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of new wells, the Company’s growth strategy, general economic conditions and availability of required equipment and services. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), commodity price and exchange rate fluctuations, legal, political and economic instability in Peru, access to transportation routes and markets for the Company’s production, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Please refer to the risk factors identified in AIF and MD&A, which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, “FOFI”) about PetroTal’s prospective results of operations, production, NPV-10, future net revenue, future development costs and components thereof, all of which are subject to the same assumptions, risk factors, limitations and qualifications as set forth in the above paragraphs. FOFI contained in this press release was made as of the date of this press release and was provided for the purpose of providing further information about PetroTal’s anticipated future business operations. PetroTal disclaims any intention or obligation to update or revise any FOFI contained in this press release, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein. All FOFI contained in this press release complies with the requirements of Canadian securities legislation, including NI 51-101.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.


PetroTal Brings Second Oil Well Online and Spuds Third Well in Bretaña Field

Calgary, Alberta and Houston, TexasApril 23, 2019—PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL and AIM: PTAL) is pleased to announce that the Company has placed a second oil well, the BN 95-2-2-2XD oil development well, on production through long term test facilities at the Bretaña field and spud a third well, the BN 95-3H oil well.

The Company’s second well, which reached total depth on April 9, 2019, was completed as an oil producer in the Vivian formation in the northern portion of the Bretaña structure.  The well was brought online at an initial rate of approximately 2,250 barrels of oil per day (“BOPD”). This is an early production rate and more detailed production data will be announced in due course.

The Company has also spud the BN 95-3H well the northern portion of the Bretaña field, which will be completed as a horizontal producer in the Vivian formation.  This well is expected to take 60 days to drill, complete and be brought online.

The Company’s first discovery well, which came online in mid-2018, is producing an average of 800 BOPD.

Manolo Zuniga, President and Chief Executive Officer, commented:

“We are pleased that the second oil well has come online as planned.  The initial rate is an early production rate, however. Once the well has had time to stabilize, we will provide additional information to stakeholders.  With the first two wells online the field has exceeded 3,000 BOPD.  The Company’s third oil well was spud on April 20, 2019.  This well will also target the northern part of the field which will give us additional data points to continue defining the reservoir.”

For further information, please contact:

Greg Smith
Executive Vice President and Chief Financial Officer
Gsmith@Petrotal-Corp.com
T: (713) 609-9101

Manolo Zuniga
President and Chief Executive Officer
Mzuniga@Petrotal-Corp.com
T: (713) 609-9101

Mark Antelme / Henry Lerwill
Celicourt Communications (Financial PR)
petrotal@celicourt.uk
T: 44 (0) 207 520 9261

James Spinney / Ritchie Balmer / Eric Allan
Strand Hanson Limited (Nominated & Financial Adviser)
T: 44 (0) 207 409 3494

John Prior / Emily Morris / George Price
Numis Securities Limited (Joint Broker)
T: +44 (0) 207 260 1000

Jonathan Wright / Hugh R. Sanderson
GMP FirstEnergy (Joint Broker)
T: +44 (0) 20 7448 0200

READER ADVISORIES 

 

FORWARD-LOOKING STATEMENTS: This press release may contain certain statements that may be deemed to be forward-looking statements. Such statements relate to possible future events, including, but not limited to: PetroTal’s business strategy, objectives, strength and focus; drilling and completion activities and the results and timing of such activities; the ability of the Company to achieve drilling success consistent with management’s expectations; anticipated future production and revenue; and future development and growth prospects. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “believe”, "expect", “plan”, “estimate”, “potential”, “will”, “should”, “continue”, “may”, “objective” and similar expressions. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, reservoir characteristics, recovery factor, exploration upside, prevailing commodity prices and the actual prices received for PetroTal’s products, the availability and performance of drilling rigs, facilities, pipelines, other oilfield services and skilled labour, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the accuracy of PetroTal’s geological interpretation of its drilling and land opportunities, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of new wells, the Company’s growth strategy, general economic conditions and availability of required equipment and services. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), commodity price and exchange rate fluctuations, legal, political and economic instability in Peru, access to transportation routes and markets for the Company’s production, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Please refer to the risk factors identified in the Company’s annual information form for the year ended December 31, 2017 and management’s discussion and analysis for the three and nine months ended September 30, 2018 which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

 

OIL AND GAS INFORMATION: References in this press release to production test rates, initial test production rates, and other short-term production rates are useful in confirming the presence of hydrocarbons, however such rates are not determinative of the rates at which such wells will commence production and decline thereafter and are not indicative of long term performance or of ultimate recovery. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for PetroTal. A pressure transient analysis or well-test interpretation has not been carried out in respect of all wells. Accordingly, the Company cautions that the test results should be considered to be preliminary.

 

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, “FOFI”) about PetroTal’s prospective results of operations, production, and components thereof, all of which are subject to the same assumptions, risk factors, limitations and qualifications as set forth in the above paragraphs. FOFI contained in this press release was made as of the date of this press release and was provided for the purpose of providing further information about PetroTal’s anticipated future business operations. PetroTal disclaims any intention or obligation to update or revise any FOFI contained in this press release, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein. All FOFI contained in this press release complies with the requirements of Canadian securities legislation, including Canadian Securities Administrators’ National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities.

 

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.


PetroTal Announces Year-end 2018 Oil Reserves

New report shows NPV-10 growth of 90% to $535 million for 2P Reserves and $1.25 billion for 3P Reserves

Calgary, Alberta and Houston, Texas – April 11, 2019—PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL and AIM: PTAL) is pleased to provide a summary of the Company’s 2018 year-end reserves in the Bretaña field in Northern Peru.  Reserves numbers presented herein were derived from an independent reserves report (the “NSAI Report”) prepared by Netherland, Sewell & Associates, Inc. (“NSAI”) effective December 31, 2018. Unless otherwise noted, all figures referred to in this press release are denominated in U.S. Dollars.

2018 Year-end Reserve Highlights

  • Proved (“1P”) Reserves estimated at approximately 17.9 million(1) barrels (“bbl”) of oil gross;
  • Proved + Probable (“2P”) Reserves estimated at approximately 39.4 million(1) bbl of oil gross;
  • Proved + Probable + Possible (“3P”) Reserves estimated at approximately 78.7 million(1) bbl of oil gross;
  • NPV-10 of approximately $535 million for 2P Reserves and $1.25 billion for 3P Reserves; and
  • 2P Reserves NPV-10 increase of 70%.
Note:
1. Reserves include a total of approximately 2,963.6 Mbbl (3P) of oil for surface facility use across all categories (960.7 Mbbl (1P) and 1,818.2 Mbbl (2P)). See “Summary of Oil Reserves and Net Present Values as of December 31, 2018” for a summary of Company reserves, which exclude these amounts.

The Company has certified total 2P reserves of 39.4 million barrels of recoverable oil at the Bretaña field. The net present value of before tax future net revenues discounted at 10 percent (“NPV-10”) of 2P oil reserves is approximately $535 million.  On a 1P Reserves basis, reserves increased by 22% to 17.9 million bbl from 14.7 million bbl gross, with an associated NPV-10 increasing three-fold to $151 million from $38 million.  Additionally, the NPV-10 of the 3P Reserves increased by 58%.

Manolo Zuniga, PetroTal’s President and Chief Executive Officer, stated:

“The increased NPV-10 is a result of lower than expected development costs, partly as a result of using produced oil to power the field.  The lower development costs truly drive the NPV-10 of the project, where we see a major increase from $282 million to $535 million.   Even more important is the NPV-10 of the 3P reserves, estimated at $1.25 billion, which underpins our future value, which could primarily be obtained by increasing the field’s recovery factor.”

2018 Year-end Reserves Summary

The summary below sets forth PetroTal’s reserves as at December 31, 2018, as presented in the NSAI Report.  The figures in the following tables have been prepared in accordance with the standards contained in the Canadian Oil and Gas Evaluation Handbook (the “COGE Handbook”) and the reserve definitions contained in National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (“NI 51-101”). In addition to the summary information disclosed in this press release, more detailed information will be included in PetroTal’s annual information form for the year ended December 31, 2018 (the “AIF”) to be filed on SEDAR (www.sedar.com) and posted on PetroTal’s website (www.Petrotal-corp.com) in April 2019.

The reserves estimated by NSAI on the charts below exclude up to three million barrels that are expected to be used for power generation in the field.

Summary of Oil Reserves and Net Present Values as of December 31, 2018

Company

Heavy Oil Reserves(2)

(Mbbl)(1)

Future Net Revenue

Before Income Taxes (USM$)(4)(5)(6)

Category Gross Net Discounted at 0% Discounted at 5% Discounted at 10% Discounted at 15% Discounted at 20%
Proved Developed Producing

Proved Undeveloped

1,559.0

15,378.5

1,559.0

15,378.5

75,696.3

202,879.9

61,506.5

143,618.9

51,624.6

99,380.2

44,472.9

66,606.6

39,112.0

42,129.6

Total Proved 16,937.5 16,937.5 278,576.2 205,125.4 151,004.8 111,079.5 81,241.6
Probable Undeveloped 20,597.8 20,597.8 772,240.6 523,525.2 384,528.6 299,631.9 243,749.6
Proved + Probable 37,535.4 37,535.4 1,050,816.8 728,650.6 535,533.4 410,711.4 324,991.2
Possible Undeveloped 38,278.9 38,278.9 1,684,251.1 1,060,626.2 718,814.0 516,783.2 389,791.8
Proved + Probable + Possible 75,814.2 75,814.2 2,735,067.9 1,789,276.8 1,254,347.5 927,494.6 714,783.0
Notes:
  1. Totals may not add because of rounding. Mbbl are thousands of barrels.
  2. PetroTal owns a 100 percent company gross interest and a 100 percent company net interest in these properties. Company reserves exclude a total of approximately 2,963.6 Mbbl (3P) of oil for surface facility use across all categories (960.7 Mbbl (1P) and 1,818.2 Mbbl (2P)).
  3. Net reserves do not include deductions for royalty expenses for net oil volumes; government royalties are included in property and mineral taxes.
  4. Based on NSAI’s December 31, 2018 escalated price forecast. See “Summary of Pricing and Inflation Rate Assumptions – Forecast Prices and Costs”.
  5. It should not be assumed that the undiscounted or discounted net present value of future net revenue attributable to the Company’s reserves estimated by NSAI represent the fair market value of those reserves.
  6. All future net revenues are estimated using forecast prices and cost assumptions, arising from the anticipated development and production of reserves, after the deduction of royalties, operating costs, development costs and abandonment and reclamation costs but before consideration of indirect costs such as administrative, overhead and other miscellaneous expenses. There is no assurance that the forecast prices and costs assumptions will be attained and variances could be material. The recovery and reserve estimates of the Company’s reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered.  Actual reserves may be greater than or less than the estimates provided herein.
Period Ending Oil Price (US$/BBL)
12-31-2019 63.88
12-31-2020 68.20
12-31-2021 70.98
12-31-2022 73.35
12-31-2023 75.40
12-31-2024 77.35
12-31-2025 79.40
12-31-2026 81.61

Thereafter, escalated 2 percent on January 1 of each year.

Future Development Costs

The following information sets forth development costs deducted in the estimation of PetroTal’s future net revenue attributable to the reserve categories noted below:

Proved                                                      $178.0 million

Proved + Probable                                  $251.1 million

Proved + Probable + Possible              $368.8 million

The future development costs are estimates of capital expenditures required in the future for PetroTal to convert the corresponding reserves to proved developed producing reserves.

About PetroTal

PetroTal is a publicly-traded, dual-listed (TSX-V: TAL and AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's development asset is the Bretaña field in Peru's Block 95 where oil production was initiated in June 2018. Additionally, the Company has large exploration prospects and is engaged in finding a partner to drill the Osheki prospect in Block 107. The Company's management team has significant experience in developing and exploring for oil in Northern Peru and is led by a Board of Directors that is focused on safely and cost effectively developing and exploiting the Bretaña oil field.

Qualified Person Review

Manuel Pablo Zúñiga-Pflücker, President and CEO, has approved the technical disclosure in this regulatory announcement in his capacity as a qualified person under the AIM Rules. Mr. Zúñiga is a petroleum engineer with over 30 years of industry experience. Mr. Zúñiga holds a Bachelor of Science degree in Mechanical Engineering from the University of Maryland and a Masters of Science degree in Petroleum Engineering from Texas A&M University. Mr. Zúñiga is a member of the Society of Petroleum Engineers.

For further information, please contact:

Greg Smith
Executive Vice President and Chief Financial Officer
Gsmith@Petrotal-Corp.com
T: (713) 609-9101

Manolo Zuniga
President and Chief Executive Officer
Mzuniga@Petrotal-Corp.com
T: (713) 609-9101

Mark Antelme / Henry Lerwill
Celicourt Communications (Financial PR)
petrotal@celicourt.uk
T: 44 (0) 207 520 9261

James Spinney / Ritchie Balmer / Eric Allan
Strand Hanson Limited (Nominated & Financial Adviser)
T: 44 (0) 207 409 3494

John Prior / Emily Morris / George Price
Numis Securities Limited (Joint Broker)
T: +44 (0) 207 260 1000

Jonathan Wright / Hugh R. Sanderson
GMP FirstEnergy (Joint Broker)
T: +44 (0) 20 7448 0200

READER ADVISORIES 

FORWARD-LOOKING STATEMENTS: This press release may contain certain statements that may be deemed to be forward-looking statements. Such statements relate to possible future events, including, but not limited to: PetroTal’s business strategy, objectives, strength and focus; drilling and completion activities and the results of such activities; the ability of the Company to achieve drilling success consistent with management’s expectations; anticipated future production and revenue; future development and growth prospects; and the timing of release of the AIF. All statements other than statements of historical fact may be forward-looking statements. In addition, statements relating to expected production, reserves, recovery, costs and valuation are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “believe”, "expect", “plan”, “estimate”, “potential”, “will”, “should”, “continue”, “may”, “objective” and similar expressions. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, reservoir characteristics, recovery factor, exploration upside,  prevailing commodity prices and the actual prices received for PetroTal’s products, the availability and performance of drilling rigs, facilities, pipelines, other oilfield services and skilled labour, royalty regimes and exchange rates, the application of regulatory and licensing requirements, the accuracy of PetroTal’s geological interpretation of its drilling and land opportunities, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of new wells, the Company’s growth strategy, general economic conditions and availability of required equipment and services. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), commodity price and exchange rate fluctuations, legal, political and economic instability in Peru, access to transportation routes and markets for the Company’s production, changes in legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Please refer to the risk factors identified in the Company’s annual information form for the year ended December 31, 2017 and management’s discussion and analysis for the three and nine months ended September 30, 2018 which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

OIL AND GAS INFORMATION: This press release contains oil and gas metrics, including “future development costs”, which do not have standardized meanings or standard methods of calculation and therefore such measures may not be comparable to similar measures used by other companies. Such metrics have been included herein to provide readers with additional measures to evaluate the Company’s performance; however, such measures are not reliable indicators of the future performance of the Company and future performance may not compare to the performance in previous periods. Future development costs are calculated as the sum of development capital plus the change in future development costs for the period. 

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, “FOFI”) about PetroTal’s prospective results of operations, production, NPV-10, future net revenue, future development costs, and components thereof, all of which are subject to the same assumptions, risk factors, limitations and qualifications as set forth in the above paragraphs. FOFI contained in this press release was made as of the date of this press release and was provided for the purpose of providing further information about PetroTal’s anticipated future business operations. PetroTal disclaims any intention or obligation to update or revise any FOFI contained in this press release, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein. All FOFI contained in this press release complies with the requirements of Canadian securities legislation, including NI 51-101.

 

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.


PetroTal Reaches Total Depth on Second Bretaña Oil Well

Calgary,
Alberta and Houston, Texas
April
9, 2019
—PetroTal Corp. (“PetroTal
or the “Company”) (TSX-V: TAL and
AIM: PTAL) is pleased to announce that the BN 95-2-2-2XD oil
development well (the “well”) which commenced drilling operations on February
26, 2019, has reach total depth. 

The well is being completed as a producer
in the Vivian formation in the northern portion of the Bretaña structure. 
This is the second oil well in the first phase of development of the Bretaña oilfield.  The well was directionally drilled to approximately 3,040 meters total
depth.  Initial logs indicate a total
gross oil column of 24 meters with estimated net oil pay of 18.7 meters, in
line with the Company’s expectations. 
The indicated oil water contact in the well was in direct correlation to
the other four wells previously drilled in the field.

Once completed the well will be placed online, expected in
approximately one week.  The Company will
provide details on flow rates with the fourth quarter and year-end earnings
release scheduled for the week of April 22, 2019.

The discovery well, which came online in mid-2018, is producing in line
with management’s expectations at an average of 950 - 1,000 barrels per day and
has accumulated over 260,000 barrels of oil produced to date.

Manolo Zuniga, President and Chief Executive Officer, commented:“We are pleased that the operations team was able to drill this well on time and on budget.  This is a testament to the entire team from drillers, to contractors, to our corporate social responsibility team who worked tirelessly to ensure safe and efficient operations.  The well logs provide an early indication that the reservoir is as we expected, with good oil shows in the mud logs and good indications from the full suite of logs obtained.  We expect this well to be online within the week and then we will proceed with drilling the BN-95-3H development oil well.”

For further information, please contact:

Greg Smith
Executive Vice President and Chief Financial Officer
Gsmith@Petrotal-Corp.com
T: (713) 609-9101

Manolo Zuniga
President and Chief Executive Officer
Mzuniga@Petrotal-Corp.com
T: (713) 609-9101

Mark Antelme / Henry Lerwill
Celicourt Communications (Financial PR)
petrotal@celicourt.uk
T: 44 (0) 207 520 9261

James Spinney / Ritchie Balmer / Eric Allan
Strand Hanson Limited (Nominated & Financial Adviser)
T: 44 (0) 207 409 3494

John Prior / Emily Morris / George Price
Numis Securities Limited (Joint Broker)
T: +44 (0) 207 260 1000

Jonathan Wright / Hugh R. Sanderson
GMP FirstEnergy (Joint Broker)
T: +44 (0) 20 7448 0200

READER ADVISORIES 

FORWARD-LOOKING STATEMENTS: This press release may
contain certain statements that may be deemed to be forward-looking statements.
Such statements relate to possible future events, including, but not limited
to: PetroTal’s business strategy, objectives, strength and focus; drilling and
completion activities and the results and timing of such activities; the
ability of the Company to achieve drilling success consistent with management’s
expectations; anticipated future production and revenue; future development and
growth prospects; and the timing of the Company’s year-end earnings press
release. . All statements other than statements of historical fact may be
forward-looking statements. Forward-looking statements are often, but not
always, identified by the use of words such as “anticipate”, “believe”,
"expect", “plan”, “estimate”, “potential”, “will”, “should”,
“continue”, “may”, “objective” and similar expressions. The forward-looking
statements are based on certain key expectations and assumptions made by the
Company, including, but not limited to, expectations and assumptions concerning
the ability of existing infrastructure to deliver production and the
anticipated capital expenditures associated therewith, reservoir
characteristics, recovery factor, exploration upside,  prevailing commodity prices and the actual
prices received for PetroTal’s products, the availability and performance of
drilling rigs, facilities, pipelines, other oilfield services and skilled
labour, royalty regimes and exchange rates, the application of regulatory and
licensing requirements, the accuracy of PetroTal’s geological interpretation of
its drilling and land opportunities, current legislation, receipt of required
regulatory approval, the success of future drilling and development activities,
the performance of new wells, the Company’s growth strategy, general economic
conditions and availability of required equipment and services. Although the
Company believes that the expectations and assumptions on which the forward-looking
statements are based are reasonable, undue reliance should not be placed on the
forward-looking statements because the Company can give no assurance that they
will prove to be correct. Since forward-looking statements address future
events and conditions, by their very nature they involve inherent risks and
uncertainties. Actual results could differ materially from those currently
anticipated due to a number of factors and risks. These include, but are not
limited to, risks associated with the oil and gas industry in general (e.g.,
operational risks in development, exploration and production; delays or changes
in plans with respect to exploration or development projects or capital
expenditures; the uncertainty of reserve estimates; the uncertainty of estimates
and projections relating to production, costs and expenses; and health, safety
and environmental risks), commodity price and exchange rate fluctuations,
legal, political and economic instability in Peru, access to transportation
routes and markets for the Company’s production, changes in legislation
affecting the oil and gas industry and uncertainties resulting from potential
delays or changes in plans with respect to exploration or development projects
or capital expenditures. Please refer to the risk factors identified in the
Company’s annual information form for the year ended December 31, 2017 and
management’s discussion and analysis for the three and nine months ended September
30, 2018 which are available on SEDAR at www.sedar.com. The forward-looking
statements contained in this press release are made as of the date hereof and
the Company undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of new
information, future events or otherwise, unless so required by applicable
securities laws.

FOFI DISCLOSURE: This press release contains
future-oriented financial information and financial outlook information
(collectively, “FOFI”) about PetroTal’s prospective results of operations, production,
and components thereof, all of which are subject to the same assumptions, risk
factors, limitations and qualifications as set forth in the above paragraphs.
FOFI contained in this press release was made as of the date of this press
release and was provided for the purpose of providing further information about
PetroTal’s anticipated future business operations. PetroTal disclaims any
intention or obligation to update or revise any FOFI contained in this press
release, whether as a result of new information, future events or otherwise,
unless required pursuant to applicable law. Readers are cautioned that the FOFI
contained in this press release should not be used for purposes other than for
which it is disclosed herein. All FOFI contained in this press release complies
with the requirements of Canadian securities legislation, including Canadian
Securities Administrators’ National Instrument 51-101 Standards  of Disclosure for Oil and Gas Activities..

Neither the
TSX Venture Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this press release.