PetroTal Provides Update on the Filing of 2019 Year-End and First Quarter 2020 Results

Bretana oil field operations expected to resume in July 2020

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - May 29, 2020) - PetroTal Corp. (TSXV: TAL) and (AIM: PTAL) ("PetroTal" or the "Company") advises that, due to the impact of the global COVID-19 pandemic, it is necessary to delay its corporate filings for the three months ended March 31, 2020, as provided for by Canadian Securities Administrators.

First Quarter 2020 Filings

As a result of delays in accessing information due to mandatory stay at home orders in Peru, the Company will postpone the filing of its unaudited consolidated financial statements and management's discussion and analysis for the three months ended March 31, 2020 ("Interim Filings") until no later than July 16, 2020, in reliance on the exemption provided in Alberta Securities Commission ("ASC") Blanket Order 51-517 Temporary Exemption from Certain Corporate Finance Requirements (and similar exemptions provided by the other Canadian securities regulators) ("Blanket Order").

2019 Year-end Filings

As previously announced on April 29, 2020, the Company will also postpone the filing of its audited consolidated financial statements, management's discussion and analysis and annual information form (inclusive of the reserves disclosure required by National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities) for the year ended December 31, 2019 ("Annual Filings") until no later than June 12, 2020, in reliance on the exemption provided in the Blanket Order.

Until the Company has filed the Annual Filings and the Interim Filings, members of the Company's Board, management and other insiders are subject to an insider trading black-out policy that reflects the principles in section 9 of National Policy 11-207 - Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions.

Annual Shareholder Meeting

The Company continues to monitor public health directives and recommendations relating to the COVID-19 pandemic, including continued restrictions on in-person gatherings, and looks forward to holding its annual meeting of shareholders without having to limit physical attendance by shareholders and guests. In the circumstances, the Company has determined to defer its annual meeting until the second half of the year and, in connection therewith, the filing of proxy materials containing disclosure on director nominees, the Company's auditor, executive compensation and corporate governance, in reliance on temporary relief issued by the TSX Venture Exchange and the Canadian Securities Administrators as a result of the pandemic. In particular, the Company relies on the exemption in ASC Blanket Order 51-518 Temporary Exemptions from Certain Requirements to File or Send Securityholder Materials (and similar exemptions provided by the other Canadian securities regulators) with respect to the filing of executive compensation disclosure, which is included in the information circular for annual shareholders meetings. The requisite shareholder communications and other actions necessary to call the meeting will be undertaken when the meeting date is decided.

Corporate Update

An update on material business developments since the press release dated April 29, 2020 is described below, the majority of which have already been disclosed in prior press releases:

  • On May 7, 2020, the Company announced that the Bretana oil field was temporarily shut in due to a Peruvian government health directive for COVID-19 prevention, that caused the oil sales pipeline, operated by Petroperu, to be shut down. PetroTal continues to monitor this situation closely, and based on discussions with Petroperu, expect that in July 2020, the oil sales pipeline will re-open allowing for Bretana oil field operations to recommence;
  • PetroTal announced on May 7, 2020 a contingent liability under the Company's oil swap and sales arrangements with Petroperu, of approximately $42 million as at March 31, 2020 arising from the drop in global oil prices. As a result of the recent recovery in oil prices, the Company estimates that the contingent liability has decreased to approximately $35 million as of May 28, 2020. The ultimate liability will not be crystallized until Q3 and Q4 2020, when the physical oil sales materialize. The Company is in discussions to facilitate an arrangement whereby the contingent liability, when crystallized, will be settled over a three-year period from future cash flow, and;
  • As announced on May 7, 2020, PetroTal continues to assess a variety of financial arrangements to ensure it has the necessary funding for its operations. When finalized, the Company will update the market.


ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐quoted  (TSXV: 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 flagship asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018, six months after acquisition. 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 the Bretaña oil field.

For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedar.com, or contact:

Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101

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

Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T : 44 (0) 208 434 2643

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

Stifel Nicolaus Europe Limited (Joint Broker)

Callum Stewart / Simon Mensley / Ashton Clanfield
Tel: +44 (0) 20 7710 7600

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

READER ADVISORIES

FORWARD‐LOOKING STATEMENTS: This press release contains 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; the Company's ability to operate in accordance with developing public health efforts to contain COVID-19; the timing of filing the Annual Filings and the Interim Filings; the timing of the Company's next annual shareholder meeting. 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. 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. In addition, the Company cautions that current global uncertainty with respect to the spread of the COVID-19 virus and its effect on the broader global economy may have a significant negative effect on the Company. While the precise impact of the COVID-19 virus on the Company remains unknown, rapid spread of the COVID-19 virus may continue to have a material adverse effect on global economic activity, and may continue to result in volatility and disruption to global supply chains, operations, mobility of people and the financial markets, which could affect interest rates, credit ratings, credit risk, inflation, business, financial conditions, results of operations and other factors relevant to the Company. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three and nine months ended September 30, 2019 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.

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/56764


PetroTal Announces Temporary Shut In of Bretana Oil Field Due to COVID-19 Pipeline Closure

PetroTal provides update on financing arrangements

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - May 7, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") announces that the Northern Oil Pipeline ("ONP") operated by PETROPERU S.A. ("Petroperu") has been shut down by a public health directive from the Peruvian government, thereby resulting in PetroTal having to shut in the Bretana oil field as a result of storage capacity limitations. Additionally, PetroTal provides an update on financing initiatives to accommodate the impact of oil price reductions occurring from oil sales at the Bretana oil field in Block 95 in Peru. All monetary amounts in this release are in United States dollars.

Highlights

  • The health department of the Peruvian government issued a directive for COVID-19 prevention in high risk areas and for high risk individuals;
  • Petroperu temporarily shuts down pipeline operations to comply with this directive;
  • PetroTal temporarily shuts in Bretana oil field operations due to storage capacity limitations;
  • The Company's planned capital expenditure for 2020 continues to be deferred;
  • Reduce compensation for Management and Directors by 20%;
  • Oil field shutdown will trigger significant cost reductions of operating, transportation and general and administrative costs;
  • Resulting from the global oil price reduction, the Company has a contingent derivative liability of $42 million at March 31, 2020;
  • The actual liability of the oil price difference determination is expected to be lower due to the projected improvement in oil prices when physical sales occur in Q3 and Q4, and;
  • PetroTal advises of financing discussions for a multi-year settlement of the contingent liability.

Pipeline and Bretana Oil Field Shut Down

PetroTal has been notified by Petroperu, the operator of Peru's ONP that it has temporarily shut down the pipeline as a result of a directive from the Peruvian government intended to combat the spread of COVID-19 in the communities adjacent to the pipeline operations. The directive states that no employees over the age of 60 nor with serious chronic diseases, should be working in the high risk regions of Peru. Although Petroperu has filed an appeal with the Peruvian government to allow the pipeline to resume operations on the basis that it is an essential service, it is not clear how long the pipeline operations will remain suspended. PetroTal has commenced steps to temporarily shut down oil production at the Bretana oil field due to storage capacity limitations. The shut down is being managed to ensure that operations can be returned to full production levels in an orderly manner upon reopening of the ONP. As a consequence of this directive, PetroTal will necessarily move to significantly curtail all costs related to oil field operations, as the Company moves into a temporary hibernation mode. PetroTal is pleased to report that no COVID-19 cases have been reported at the Bretana oil field.

Additional Cost Reductions

The Company announces that, in addition to ongoing cost rationalization of operating, transportation and capital development costs, PetroTal has reduced overall general and administrative costs by approximately 20%. This includes company-wide salary cuts, including cash compensation reductions of 20% for management and directors. The Company continues to prudently manage its cash resources and is exploring ways to further reduce its cost structure, as needed. The temporary Bretana oil field shut down in response to the public health directive gives PetroTal the opportunity to reduce costs more than if production was voluntarily shut in, and the Company will temporarily layoff all but essential personnel at the field and offices.

Financial Update

On May 27, 2019, PetroTal entered into a Pipeline Transportation Service Contract with Petroperu, a state-owned company, to have access to Peru's ONP that included an oil swap arrangement ("Swap Contract") that allowed PetroTal to deliver volumes of its Bretana oil by barge to the ONP Pump Station No.1 ("PS#1"), located at Saramuro, in exchange for equivalent volumes of Petroperu's premium supreme residual oil at the port of Bayovar. The Company delivered a total of approximately 580,000 barrels of Bretana oil to PS#1 pursuant to this arrangement before it expired in early December 2019.

On December 23, 2019, PetroTal entered into a new Sales Contract with Petroperu whereby all the Bretana oil delivered at PS#1 is sold to Petroperu at a monthly average reference price of ICE Brent minus $4 per barrel. As of March 31, 2020, PetroTal has delivered a total of approximately 1.2 million barrels of Bretana oil to PS#1 pursuant to the Sales Contract.

It can take up to eight months for Bretana oil to reach the Bayovar port where it can be stored for a further four months before it is ultimately sold by Petroperu. The Swap and Sale Contracts enable the Company to receive oil sales revenue earlier, improving PetroTal's liquidity. When the oil is ultimately sold by Petroperu at Bayovar, PetroTal will be subject to a valuation adjustment based on the actual price achieved by Petroperu, whether higher or lower as compared to the price received at the time of delivery to PS#1.

On a monthly basis, the Company tracks the impact of fluctuating oil prices on volumes sold under both the Swap Contract and Sales Contract, as a commodity derivative and, as a result of the recent drastic drop in oil prices, the contingent liability accruing under these contracts is approximately $18 million and $24 million, respectively, at the end of March 2020. Given the current ONP timetable, it is expected that Bretana oil delivered pursuant to the Swap Contract will be sold by Petroperu in late Q3 2020, and Bretana oil delivered pursuant to the Sales Contract will be sold by Petroperu commencing in Q4 2020, at which time the contango effect forecasts a higher Brent oil price, which would result in a lower liability. The current shut in status of the ONP could result in these physical oil sales occurring further into the future. Under the terms of the Sales Contract, the Company is required to settle this contingent liability when the balance exceeds $10 million.

The Company is in discussions to facilitate an arrangement that is expected to result in this contingent liability, when crystallized, to be paid over a three year period from future cash flow. This is an effective way to settle these obligations now, thereby allowing the Company to realize the favorable impact of the expected future higher oil prices when the physical oil sales occur. As specific details are finalized, more information on this potential source of finance will be announced in due course. The Company continues to assess other financing alternatives to ensure it has the necessary funding for its operations.

Manolo Zuniga, President and Chief Executive Officer, commented:

"PetroTal continues to support initiatives to ensure the Peruvian government provides the support needed during this pandemic, just as other countries have done. In the meantime, we continue to work on securing the necessary financial backing to ensure we are properly funded and emerge stronger from this crisis. PetroTal appreciates the ongoing dedication of all employees and the support for our business during these challenging times of the pandemic impact."

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐quoted (TSXV: TAL) (AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's flagship asset is its 100% working interest in Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018, six months after acquisition. 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 the Bretaña oil field.

For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedar.com, or contact:

Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101

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

Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T : 44 (0) 208 434 2643

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

Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Simon Mensley / Ashton Clanfield
Tel: +44 (0) 20 7710 7600

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

READER ADVISORIES

FORWARD‐LOOKING STATEMENTS: This press release contains 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; the Company's ability to resume operations in accordance with developing public health efforts to contain COVID-19; additional cost reductions; and liability under the Swap Contract and Sales Contract and the settlement of such liability. 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. 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 volatility, price differentials and the actual prices received for products, 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. In addition, the Company cautions that current global uncertainty with respect to the spread of the COVID-19 virus and its effect on the broader global economy may have a significant negative effect on the Company. While the precise impact of the COVID-19 virus on the Company remains unknown, rapid spread of the COVID-19 virus may continue to have a material adverse effect on global economic activity, and may continue to result in volatility and disruption to global supply chains, operations, mobility of people and the financial markets, which could affect interest rates, credit ratings, credit risk, inflation, business, financial conditions, results of operations and other factors relevant to the Company. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three and nine months ended September 30, 2019 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 temporary shut down of operations, the anticipated resumption of operations, storage capacity, cost reductions, pipeline transportation arrangements, liability under the Swap Contract and Sales Contract 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 included 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.

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.

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/55509


PetroTal Postpones Release Date for 2019 Year-End Results

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - April 29, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") advises that, due to the impact of the global COVID-19 pandemic, it is necessary to delay its 2019 year-end corporate filings, as provided for by Canadian Securities Administrators.

2019 Year-end Filings

The Company, as a result of delays related to access to information from mandatory stay at home orders in Peru, will postpone the filing of its audited consolidated financial statements ("Financial Statements"), management's discussion and analysis ("MD&A") and annual information form ("AIF") for the year ended December 31, 2019 (inclusive of the reserves disclosure required by National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities) until no later than June 12, 2020, in reliance on the exemption provided in ASC Blanket Order 51-517 Temporary Exemption from Certain Corporate Finance Requirements (and similar exemptions provided by the other Canadian securities regulators).

Until the Company has filed the Financials Statements, MD&A and AIF, members of the Company's Board, management and other insiders are subject to an insider trading black-out policy that reflects the principles in section 9 of National Policy 11-207 - Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions.

An update on material business developments since the filing of the Company's interim financial statements and accompanying management's discussion and analysis for the period ended September 30, 2019 is described below, the majority of which have already been disclosed in prior press releases:

  • Drilled and completed two successful horizontal oil wells as previously disclosed on announcements dated December 16, 2019 and April 21, 2020;
  • Completed commissioning of the enhanced central production facilities, to bring overall oil production capacity to between 16,000 bopd and 18,000 bopd;
  • Announced increases to its 2019 year-end reserves evaluation on February 18, 2020;
  • Oil production updates were announced in press releases dated January 13, 2020, February 18, 2020, February 27, 2020 and April 21, 2020;
  • On January 21, 2020, PetroTal announced its 2020 Budget which included $99 million of capital expenditures to drill four additional development wells, a water well and additional facilities;
  • Strengthened its Board of Directors by adding two independent directors, as announced on December 19, 2019;
  • On December 27, 2019, PetroTal announced a new oil sales contract with PETROPERU S.A. ("Petroperu"), a state-owned company, for oil production from the Bretana oil field. Pursuant to the terms of the agreement, all oil sold by PetroTal to Petroperu is priced based on the monthly average reference price of ICE Brent minus US$4.00 per barrel when it enters the pipeline at the Saramuro pump station. When the oil is ultimately sold by Petroperu at the Bayovar port, PetroTal is subject to a valuation adjustment based on the actual price achieved by Petroperu, whether higher or lower as compared to the price received at the time of sale. It can take six to eight months for the oil to reach the Bayovar port, where it can be stored by Petroperu before it effects a sale;
  • On March 11, 2020, the World Health Organization characterized the outbreak of a strain of the novel coronavirus (COVID-19) as a pandemic which has resulted in a series of public health and emergency measures that have been put in place to combat the spread of the virus. The duration and impact of COVID-19 is unknown at this time and it is not possible to reliably estimate the impact that the length and severity of these developments will have on the financial results and condition of the Company in future periods. Significant declines in crude oil spot prices and in stock markets have occurred for various reasons linked to the pandemic and other conditions impacting worldwide oil prices;
  • PetroTal announced on March 10, 2020 and April 21, 2020 initiatives taken to reduce operating and transportation costs and defer some capex programs to maximize liquidity, and advised of the net operating income (netback) at varying oil prices;
  • The Company announced its cash position at 2019 year-end and at March 31, 2020, respectively, on January 13, 2020 and April 21, 2020; and
  • On April 21, 2020, PetroTal announced discussions to establish a credit facility either based on the increased year-end 2019 reserve valuation, or from the recently completed production facilities investment.

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐quoted (TSXV: 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 flagship asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018, six months after acquisition. 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 the Bretaña oil field. More information on the Company can be found at www.PetroTal‐Corp.com.

For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedar.com, or contact:

Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101

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

Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T: 44 (0) 208 434 2643

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

Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Simon Mensley / Ashton Clanfield
Tel: +44 (0) 20 7710 7600

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

READER ADVISORIES

FORWARD‐LOOKING STATEMENTS: This press release contains 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; the Company's ability to remain operating in accordance with developing public health efforts to contain COVID-19; and the timing of filing the Financial Statements, MD&A and AIF. 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. 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. In addition, the Company cautions that current global uncertainty with respect to the spread of the COVID-19 virus and its effect on the broader global economy may have a significant negative effect on the Company. While the precise impact of the COVID-19 virus on the Company remains unknown, rapid spread of the COVID-19 virus may continue to have a material adverse effect on global economic activity, and may continue to result in volatility and disruption to global supply chains, operations, mobility of people and the financial markets, which could affect interest rates, credit ratings, credit risk, inflation, business, financial conditions, results of operations and other factors relevant to the Company. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three and nine months ended September 30, 2019 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.

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/55102


PetroTal Completes Third Horizontal Well at the Bretana Oil Field

Achieves record average quarterly production of 9,688 bopd in Q1 2020
Prudent management of cash resources and dividend suspension

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - April 21, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") is pleased to provide an update on its operations and production at the Bretana oil field in Block 95 in Peru (100% working interest), together with a wider Company financing update. All monetary amounts in this release are in United States dollars.

HIGHLIGHTS

  • The BN 95-6H horizontal well ("6H") came online on April 10, 2020 and is currently producing approximately 5,750 barrels of oil per day ("bopd"), in line with management's expectations. During these ten days the well has achieved average production of approximately 4,500 bopd.
  • The 6H well was completed on time and under the original $12.6 million budget.
  • The 6H well reached a lateral length of 1,178 meters and has been completed using autonomous inflow control device ("AICD") valves that restrict water inflow, to help maximize oil production.
  • The Bretana oil field reached new record quarterly production of approximately 9,688 bopd and sales of 9,937 bopd during the first quarter of 2020.
  • Completed commissioning of the enhanced central production facilities ("CPF-1"), bring overall oil production capacity to between 16,000 bopd and 18,000 bopd.
  • In order to preserve liquidity, the Company will postpone drilling the water disposal well that was scheduled to spud after 6H and, based on the enhanced CPF-1 production capacity, also delay completion of the CPF-2 facilities, reducing the Company's overall 2020 capital expenditure budget by 33% to $66 million.
  • In light of global market uncertainty, and to further conserve cash, the Company will postpone drilling the BN 95-7H horizontal well until at least July 2020, instead of the previously announced mid-May spud date.
  • As of March 31, 2020, the Company has $7.3 million of cash on hand, which is prior to receipt of approximately $7.5 million, from net proceeds of March oil sales.

Further Information

PetroTal has successfully completed the 6H well, the Company's third horizontal well in the Bretana oil field, which is currently producing 5,750 bopd, in line with management's expectations. The well reached the target Vivian formation at a vertical depth of 2,698 meters. The 1,178-meter horizontal section inside the main productive oil reservoir makes the 6H well the longest horizontal well drilled to date in Peru. Based on the success in the BN 95-4H ("4H") and BN 95-5H ("5H") wells, the 6H well completion utilizes additional AICD valves to maximize oil production. The 6H well was drilled to the west of 5H, slightly downdip of the crest of the structure, at a similar depth to the 4H. The well cost was approximately $12.5 million, under budget by approximately $0.15 million.

The Company has postponed drilling the second water disposal well, and now expects to spud the next oil well in July 2020, at the earliest, with the drill rig now on standby status at negotiated reduced rates. Decisions on additional 2020 capital activity, including drilling additional oil wells, will be made in due course. PetroTal will look to preserve capital by deferring certain projects, such as drilling the previously mentioned water disposal well and finalizing the CPF-2, as required. The Company has discretion over when to undertake all major capital projects.

Bretana Oilfield Operations and Operational Netbacks

The safety of the Company's workforce in Peru is of the utmost importance, consequently, PetroTal has proactively implemented measures to prevent the occurrence of COVID-19 at the Bretana oil field, in conjunction with employees and the nearby community. These measures include: the restricted movement of people and goods; increased hygiene and cleanliness; social distancing and remote working; deferring some projects to reduce the workforce on site; working with the surrounding communities and developing contingency plans for potential disruptions.

As announced on March 10, 2020, the Company expected to achieve operational netbacks of $11 per barrel with its benchmark Brent priced at $30 per barrel. To date, the Company has achieved netbacks of $12 per barrel and continues to engage with all its contractors to further optimize its cost structure. PetroTal will now look to achieve netbacks of $13 per barrel, equivalent to 43% at $30 Brent.

Because of the strict safety and health measures and relatively high netbacks under the current Brent pricing environment, the Bretana oilfield is the only oil field still producing in the Maranon basin of Peru.

Financial Update

The Company continues to prudently manage its cash resources. In order to increase its financial flexibility, PetroTal is in discussions to establish a credit facility either based on the increased year-end 2019 reserve valuation, or from the recently completed production facilities investment. Having access to such a credit facility will strengthen PetroTal's liquidity and allow it to continue to progress the majority of its development plans. The Company has additional flexibility to further reduce its cost structure as needed. Such measures include further deferrals of non-essential capital expenditures, seeking cost reductions from suppliers and extension of payment terms. Taking these steps will help to ensure the sustenance of resource operations in Peru, for all parties.

Dividend Suspension

Due to the financial impact of the global oil price disruption, the Company has decided to suspend declaration and payment of all dividends in order to manage cash for business operations. The Board of Directors will evaluate this decision on a semi-annual basis going forward and expects to reinstate its dividend policy when appropriate.

Manolo Zuniga, President and Chief Executive Officer, commented:

"PetroTal is pleased to announce another strong drilling result, with 6H being our third horizontal well drilled on time and under budget. The 6H well complements the performance of the 4H and 5H wells, and over the next few months, PetroTal will focus on optimizing production from our seven producing oil wells and preserving the Company's capital position. PetroTal is fortunate to have loyal and understanding partners amongst its many contractors and related Peruvian government ministries and agencies and we are pleased to have already achieved an increase in netbacks to $12 a barrel.

In closing, I want to sincerely commend the entire PetroTal team for their ongoing determination to deal with the COVID-19 pandemic and I look forward to keeping all of our stakeholders apprised of developments over the coming months."

Qualified Person's Statement

Estuardo Alvarez-Calderon, the Company's Vice President, Exploration and Development, who has over 35 years of relevant experience in the oil industry, has approved the technical information contained in this announcement. Mr. Alvarez-Calderon received a Bachelor of Science degree in Geology from the University of Texas at Austin and is registered on the Texas Board of Professional Geoscientists.

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐quoted (TSXV: 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 flagship asset is the Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, six months after acquisition. 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 the Bretana oil field.

For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedar.com, or contact:

Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101

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

Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T : 44 (0) 208 434 2643

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

Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Simon Mensley / Ashton Clanfield
Tel: +44 (0) 20 7710 7600

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

READER ADVISORIES

FORWARD‐LOOKING STATEMENTS: This press release contains 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, completion, commissioning and workover activities of oil producing and water disposal wells and facilities and the results and timing of such activities; the use of AICD valves to optimize well productivity; the ability of the Company to achieve drilling success consistent with management's expectations; anticipated future production and production capacity; the 2020 capital program; engaging a partner to drill the Osheki prospect; the suspension of the Company's dividend and the possible future reinstatement of a dividend; future development and growth prospects; and the Company's ability to remain operating in accordance with developing public health efforts to contain COVID-19. 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. In addition, the Company cautions that current global uncertainty with respect to the spread of the COVID-19 virus and its effect on the broader global economy may have a significant negative effect on the Company. While the precise impact of the COVID-19 virus on the Company remains unknown, rapid spread of the COVID-19 virus may continue to have a material adverse effect on global economic activity, and may continue to result in volatility and disruption to global supply chains, operations, mobility of people and the financial markets, which could affect interest rates, credit ratings, credit risk, inflation, business, financial conditions, results of operations and other factors relevant to the Company. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three and nine months ended September 30, 2019 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, production capacity, capital budget and capital activity, cash flow, growth 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 included 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.

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/54684


PetroTal Provides Liquidity Update

Continues to remain nimble even with lower oil prices

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - March 10, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company"), the Peruvian focused E&P company, notes the following in relation to the global retraction in oil prices, and global market decline. All currency amounts are in United States dollars.

Financial Impact

In response to the sudden reduction in the Brent oil price, PetroTal has completed a sensitivity assessment of funds available from operations ("netback") at varying oil price levels. As noted in our February corporate presentation (available on the Company's website at www.petrotal-corp.com), Bretaña's netback at 15,000 barrels of oil per day ("bopd") was 55% of the Brent oil price at $65/bbl and decreases to 37% at the Brent oil price of $30/bbl.

 

Based on 15,000 bopd
Brent Oil - $/bbl $65 $60 $55 $50 $45 $40 $35 $30
Netback  - $/bbl $36 $33 $28 $24 $21 $18 $14 $11
          Netback Ratio (%) 55% 54% 52% 48% 47% 45% 40% 37%
Based on 20,000 bopd
Brent Oil - $/bbl $65 $60 $55 $50 $45 $40 $35 $30
Netback  - $/bbl $38 $34 $29 $25 $22 $19 $15 $12
          Netback Ratio (%) 58% 57% 53% 50% 49% 48% 43% 40%

 

In some of our contracts, as Brent oil prices drop below $50/bbl, PetroTal is entitled to negotiate lower fees and tariffs to stabilize netbacks. These graduated cost reductions (included in the above table) serve to increase netbacks by approximately $3/bbl at $30 Brent.

Each barrel of oil production contributes positively towards funding all administrative costs and the Company's capital investments. PetroTal has the benefit of not having any debt or interest expenses, and no concerns about loan covenants.

Since PetroTal maintains significant investment program flexibility, the Company has the ability to be resilient and ensure that it balances cash flow with expenditures. The Company's previously announced $99 million capital investment program is weighted to the last half of the year and will continue to be monitored closely in light of the reduced oil price environment. Furthermore, given the strong relationship PetroTal has with its key contractors, the Company has agreed to manage payments with a number of its contractors, allowing for ongoing operation of the contractors' crews.

Well 6H - Update

Drilling of the 6H oil well continues on schedule and on budget, and PetroTal expects to have this well on production before mid-April 2020. Being on trend with the 5H and 4H wells, and benefiting from the longer horizontal zone penetration, higher oil production is expected from the 6H well. Inclusive of the 6H well, we expect to achieve production of 15,000 bopd that, coupled with the ongoing positive netbacks, will strengthen our financial resources.

Manolo Zuniga, President and Chief Executive Officer, commented:

"PetroTal remains confident in its ability to manage oil price fluctuations through a disciplined financial approach. Our assessments show that, based on current projections and pricing environment, the Company will remain cash flow positive this year. Importantly, if the global oil price retraction continues for an extended period, PetroTal has the flexibility to defer capital investment. At this stage, our 2020 oil production guidance remains in effect and the expected success of the 6H well will contribute significantly towards our target.

On behalf of our valued shareholders, please be assured that we'll make the right decisions, at the right time, to ensure we maintain the financial flexibility to be cash flow positive. I would like to sincerely thank our team for their continued laser-focus on all costing aspects, as well as our contractors for their ongoing support of PetroTal's financial resources."

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐quoted (TSXV: 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 flagship asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018, six months after acquisition, and within 18 months has exceeded the initial 10,000 bopd goal. Additionally, the Company has large exploration upside and is actively engaged to find a partner to drill the Osheki prospect and other prospects in Block 107. The Company's management team has significant experience in developing and exploring for oil in all of Peru's oil producing basins and is led by a Board of Directors that is focused on safely and cost effectively developing the Bretaña oil field. More information on the Company can be found at www.PetroTal‐Corp.com.

For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedar.com, or below:

Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101

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

Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T : 44 (0) 208 434 2643

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

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

Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Nicholas Rhodes / Ashton Clanfield
Tel: +44 (0) 20 7710 7600

READER ADVISORIES

FORWARD-LOOKING STATEMENTS: This news release contains forward-looking statements. More particularly, and without limitation, this news release contains statements concerning PetroTal's assessment of future plans and operations for the Company. When used in this document, the words "will," "anticipate," "believe," "estimate," "expect," "intent," "may," "project," "should," and similar expressions are intended to be among the statements that identify forward-looking statements. The forward-looking statements are founded on the basis of expectations and assumptions made by PetroTal. Although PetroTal believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to: PetroTal may not obtain the required approvals from the TSX Venture Exchange and other factors more fully described from time to time in the reports and filings made by PetroTal with securities regulatory authorities. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three and nine months ended September 30, 2019 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.

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/53304


PetroTal Announces Updated Corporate Presentation and TSX Venture Exchange Recognition

Selected as the 2020 Venture 50 Top Performing Energy Company

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - February 27, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company"), the Peruvian focused E&P company, is pleased to announce that an updated corporate presentation is now available on the Company's website at www.petrotal-corp.com. Additionally, PetroTal is delighted to be recognized as one of the top 50 performing TSXV-listed issuers, ranking first in the energy industry sector.

The 2020 Venture 50

The 2020 Venture 50 is an annual program of the TSX Venture Exchange that recognizes the top performing TSXV-listed companies from five industry sectors. The 2020 Venture 50 winners are chosen based on 2019 annual performance for market capitalization growth, share price appreciation and trading volume. A video featuring PetroTal can be found at https://tmxmatrix.com/company/TAL/story. For more information and the full 2020 Venture 50 ranking, visit:www.tsx.com/venture50.

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐quoted (TSXV: 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 flagship asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018, six months after acquisition, and within 18 months has exceeded the initial 10,000 bopd goal. Additionally, the Company has large exploration upside and is actively engaged to find a partner to drill the Osheki prospect and other prospects in Block 107. The Company's management team has significant experience in developing and exploring for oil in all of Peru's oil producing basins and is led by a Board of Directors that is focused on safely and cost effectively developing the Bretaña oil field. More information on the Company can be found at www.PetroTal‐Corp.com.

For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedar.com, or below:

Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101

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

Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T : 44 (0) 208 434 2643

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

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

Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Nicholas Rhodes / Ashton Clanfield
Tel: +44 (0) 20 7710 7600

READER ADVISORIES

FORWARD-LOOKING STATEMENTS: This news release contains forward-looking statements. More particularly, and without limitation, this news release contains statements concerning PetroTal's assessment of future plans and operations for the Company. When used in this document, the words "will," "anticipate," "believe," "estimate," "expect," "intent," "may," "project," "should," and similar expressions are intended to be among the statements that identify forward-looking statements. The forward-looking statements are founded on the basis of expectations and assumptions made by PetroTal. Although PetroTal believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to: PetroTal may not obtain the required approvals from the TSX Venture Exchange and other factors more fully described from time to time in the reports and filings made by PetroTal with securities regulatory authorities. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three and nine months ended September 30, 2019 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.

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/52879


TSX Venture Exchange Announces the 2020 Venture 50

February 20, 2020
TSXV's top performing companies to celebrate with market open and closing ceremonies on Friday, February 21

February 20, 2020 (TORONTO) – TSX Venture Exchange (TSXV) is pleased to announce the 2020 Venture 50, the exchange's flagship annual program showcasing the top performing listed companies from five industry sectors: Clean Technology and Life Sciences, Diversified Industries, Energy, Mining, and Technology.

Representatives of the 2020 Venture 50 companies will join TMX executives tomorrow, February 21 at two events to celebrate the achievement: a market open ceremony, at 9:30 a.m. EST in Toronto, and a market close ceremony at 4:00 p.m. EST in Vancouver. The 2020 Venture 50 winners were selected based on year-over-year performance across three equally-weighted criteria: market capitalization growth, share price appreciation and trading volume for the year ended December 31, 2019.

"We are especially proud to recognize this year's Venture 50 winners, a diverse cross-section of visionary, early-stage companies who have performed well during challenging market conditions," said Brady Fletcher, Managing Director and Head of TSX Venture Exchange. "Together, we celebrate these compelling success stories and many more across TSXV, the foundation of the world's premier two-tiered capital formation ecosystem and an engine of opportunity for issuers and investors alike. Looking ahead, we strongly believe that private sector investment is key to the long-term vitality of Canada's economy and we remain fiercely committed to advocating on behalf of our entire listed issuer client base."

2020 Venture 50 Rankings
This year's overall #1 ranked Venture 50 company is dynaCERT Inc. (DYA), a Canadian clean technology company engaged in the design, engineering, testing, manufacturing and distribution of a transportable hydrogen generator system.

The top performing 2020 Venture 50 companies from each industry sector are:

Clean Technology & Life Sciences dynaCERT Inc. (DYA)
Diversified Industries Well Health Technologies Corp. (WELL)
Energy PetroTal Corp. (TAL)
Mining BTU Metals Corp. (BTU)
Technology Score Media and Gaming Inc. (SCR)

For the full 2020 Venture 50 ranking, methodology and profile videos of companies included in the ranking, visit: www.tsx.com/venture50

For Market Openings and Closings: Media may pick up a feed from the TOC (television operations centre) for all market open/close ceremonies. The feed is named TSX Transmit 1 (SD-SDI) and is produced at the TMX Broadcast Centre and sent live to the TOC. The client moves into position for the market open/close ceremony at approximately 9:27 a.m. ET/3:57 p.m. ET and the markets will open/close with the sound of a siren (the traditional market open/close on Toronto Stock Exchange) at 9:30 a.m. ET/4:00 p.m. ET.

This news release is not, and should not be construed as an invitation to purchase securities listed on TSX Venture Exchange. TMX Group and its affiliates do not endorse or recommend any of the referenced securities nor should any statement in this news release be construed as advice regarding a broad investment strategy. Please seek professional advice to evaluate specific securities. Listing on TSX Venture Exchange does not guarantee the future performance of a security or an issuer. TMX, TMX Group, Toronto Stock Exchange, TSX, TSX Venture Exchange, TSX Venture 50 and TSXV are trademarks of TSX Inc.

About TMX Group (TSX:X)

TMX Group operates global markets, and builds digital communities and analytic solutions that facilitate the funding, growth and success of businesses, traders and investors. TMX Group's key operations include Toronto Stock ExchangeTSX Venture ExchangeTSX Alpha ExchangeThe Canadian Depository for SecuritiesMontréal ExchangeCanadian Derivatives Clearing Corporation, and Trayport which provide listing markets, trading markets, clearing facilities, depository services, technology solutions, data products and other services to the global financial community. TMX Group is headquartered in Toronto and operates offices across North America (Montréal, Calgary, Vancouver and New York), as well as in key international markets including London and Singapore. For more information about TMX Group, visit our website at www.tmx.com. Follow TMX Group on Twitter: @TMXGroup.

For more information, please contact:

Catherine Kee
Senior Manager, Corporate Communications & Media Relations
TMX Group
416-814-8834
catherine.kee@tmx.com


PetroTal Announces 2019 Year-End Oil Reserves and Operational Update

20% increase in 1P Reserves to 21.5 million barrels and 21% increase in 2P Reserves to 47.7 million barrels

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - February 18, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company"), the Peruvian focused E&P company, is pleased to announce the results of its 2019 year-end reserve evaluation by Netherland, Sewell & Associates, Inc. ("NSAI") for the Bretaña oil field, operated 100% by PetroTal, and to provide an update on current activity and production. All currency amounts are in United States dollars (unless otherwise stated), and comparisons refer to December 31, 2018.

HIGHLIGHTS:

  • Proved ("1P") reserves increased by 20%, to 21.5 million barrels ("mmbbl") from 17.9 mmbbl, Proved plus Probable ("2P") reserves increased by 21% to 47.7 mmbbl from 39.4 mmbbl and Proved plus Probable and Possible ("3P") reserves increased by 8% to 84.8 mmbbl from 78.7 mmbbl;
  • Related to 2019 oil production of 1.5 mmbbl, reserve additions replaced 240% in 1P reserves, 553% in 2P reserves and 407% in 3P reserves; Bretaña's reserve life index for 1P and 2P reserves is now 7.7 years and 17.0 years, respectively;
  • Net Present Value (before tax, discounted at 10%) (NPV-10) is calculated at $434 million ($20.19/bbl) for 1P reserves, $1.1 billion ($23.02/bbl) for 2P reserves and $1.9 billion ($22.11/bbl) for 3P reserves;
    • Using the 2019 year-end Brent oil price strip, NPV-10 is calculated at $280 million for 1P reserves, $722 million for 2P reserves and $1.2 billion for 3P reserves;
  • The successful 2019 development program combined with all future development and abandonment costs represent total finding and development costs of $12.04/bbl for 1P reserves, $5.32/bbl for 2P reserves and $4.06/bbl for 3P reserves;
  • Original oil in place ("OOIP") estimates for each category of reserves have also increased, with the 2P estimate increasing from 329 mmbbl to 364 mmbbl;
  • NSAI attributes a corresponding 2P recovery factor of 13.6%, increased from 12% at year-end 2018;
  • On a 2P basis, this represents a recycle ratio of 6.5 times, based on the total $5.32/bbl finding and development cost relative to a netback of $35/bbl (at $65/bbl Brent oil price);
  • Drilling has commenced for the Bretaña 6H well, planned to have the longest lateral to date with an estimated drill time of 60 days; and
  • Current oil production at Bretaña is approximately 10,000 barrels of oil per day ("bopd").

2019 Year-end Reserves Summary

The summary below sets forth PetroTal's reserves as at December 31, 2019, as presented in the independent reserves report prepared by NSAI. 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 announcement, more detailed information will be included in PetroTal's annual information form for the year ended December 31, 2019 (the "AIF") to be filed on SEDAR (www.sedar.com) and posted on PetroTal's website (www.Petrotal-corp.com) in April 2020.

Five Year Crude Oil Price Forecast - NSAI Report

Year-End Forecast: 2020 2021 2022 2023 2024 2025
Brent (USD$/bbl) - January 1, 2020 (1) $66.33 $67.94 $70.06 $71.66 $73.27 $74.57
Brent (USD$/bbl) - January 1, 2019 (1) $68.20 $70.98 $73.35 $75.40 $77.35 $79.40
Year-End Strip projection:
Brent (USD$/bbl) - January 1, 2020 (2) $63.71 $59.37 $57.32 $56.70 $57.06 $57.72

 

(1) The oil price projections used by NSAI are based upon an average of three December 31, 2019 forecasts of Brent Crude futures prices prepared by Canadian independent consultants.

(2) Represents the forward strip oil price as at December 31, 2019, escalating at 2% per year after 2025.

Year-End Crude Oil Reserves (mmbbl)

CATEGORY 2019 2018 Change
Proved
    Developed Producing 11.2 1.6 600%
    Undeveloped 10.3 16.3 -37%
Total Proved 21.5 17.9 20%
Probable 26.2 21.5 22%
Total Proved plus Probable 47.7 39.4 21%
Possible 37.1 39.3 -6%
Total Proved plus Probable & Possible 84.8 78.7 8%

 

Represents gross and net barrels since PetroTal owns a 100% working interest and a 100% net revenue interest in these properties. Royalties are paid from sales proceeds

Year-End Net Present Value at 10% - Before Tax ($ millions)

CATEGORY 2019 2018 Change
Proved
    Developed Producing $202 $52 287%
    Undeveloped $232 $99 134%
Total Proved $434 $151 187%
Probable $665 $385 72%
Total Proved plus Probable $1,098 $536 105%
Possible $777 $718 8%
Total Proved plus Probable & Possible $1,875 $1,254 50%

 

Year-End Net Asset Value ("NAV") per Share

CATEGORY Dec. 31, 2019 Dec. 31, 2018
NAV per share US$/sh CAD$/sh US$/sh CAD$/sh
Proved $0.65 $0.87 $0.28 $0.37
Proved plus Probable $1.63 $2.17 $0.72 $0.96
Proved plus Probable & Possible $2.79 $3.72 $1.00 $1.33

 

Represents NPV-10 divided by common shares issued as of December 31 of each respective year. Canadian share prices are converted at the respective year end foreign exchange conversion rates.

Reserve Life Index ("RLI")

CATEGORY Dec. 31, 2019 (1)
Proved 7.7 years
Proved plus Probable 17.0 years
Proved plus Probable & Possible 30.3 years (2)

 

(1) Based on 2019 year-end reserves divided by average Q4 2019 production of approximately 7,757 bopd, annualized.
(2) The license for Block 95 expires in 2041.

Future Development Costs

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

Proved $124 million
Proved plus Probable $194 million
Proved plus Probable & Possible $299 million

 

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

OPERATIONS UPDATE

The Company commenced drilling the Bretaña 6H well on February 17, 2020, following successful completion of the annual rig maintenance program. This well will take approximately 60 days to drill and complete and is expected to have a 1,100-meter lateral section; longer than the 5H (863 meters) and 4H (500 meters) wells. Following 6H, the Company will drill a second water disposal well followed by three other horizontal oil wells. PetroTal's current oil production is approximately 10,000 bopd. Production has fluctuated during the commissioning of the Central Processing Facility which commenced in late December and is now nearing completion.

Manolo Zuniga, President and Chief Executive Officer, commented:

"Following the Company's successful drilling campaign in 2019, we are very pleased to see a meaningful upgrade of reserves in the 1P and 2P categories. PetroTal is glad to see that NSAI's 2P OOIP estimate now approximates our internal estimate. We are confident that future production data will substantiate the higher recovery factors, and in the end, all of the above serves to create value for our stakeholders.

We look forward to achieving further growth in 2020, with new oil wells and increases in recovery factor, and I would like to sincerely thank our team, as well as our shareholders for their ongoing support of PetroTal."

Qualified Person's Statement

Estuardo Alvarez-Calderon, the Company's Vice President, Exploration and Development, who has over 35 years of relevant experience in the oil industry, has approved the technical information contained in this announcement. Mr. Alvarez-Calderon received a Bachelor of Science degree in Geology from the University of Texas at Austin and is registered on the Texas Board of Professional Geoscientists.

The recovery and reserve estimates provided in this news release are estimates only, and there is no guarantee that the estimated reserves will be recovered. Actual reserves may eventually prove to be greater than, or less than, the estimates provided herein. In certain of the tables set forth below, the columns may not add due to rounding.

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐quoted (TSXV: TAL) (AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's flagship asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018, six months after acquisition, and within 18 months has exceeded the initial 10,000 bopd goal. Additionally, the Company has large exploration upside and is actively engaged to find a partner to drill the Osheki prospect and other prospects in Block 107. The Company's management team has significant experience in developing and exploring for oil in all of Peru's oil producing basins and is led by a Board of Directors that is focused on safely and cost effectively developing the Bretaña oil field. More information on the Company can be found at www.PetroTal‐Corp.com.

For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedar.com, or below:

Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101

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

Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T : 44 (0) 208 434 2643

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

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

Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Nicholas Rhodes / Ashton Clanfield
Tel: +44 (0) 20 7710 7600

READER ADVISORIES

FORWARD-LOOKING STATEMENTS: This news release contains forward-looking statements. More particularly, and without limitation, this news release contains statements concerning PetroTal's assessment of future plans and operations for the Company. When used in this document, the words "will," "anticipate," "believe," "estimate," "expect," "intent," "may," "project," "should," and similar expressions are intended to be among the statements that identify forward-looking statements. The forward-looking statements are founded on the basis of expectations and assumptions made by PetroTal. Although PetroTal believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to: PetroTal may not obtain the required approvals from the TSX Venture Exchange and other factors more fully described from time to time in the reports and filings made by PetroTal with securities regulatory authorities. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three and ninex months ended September 30, 2019 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.

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/52496


PetroTal Announces Fully Funded 2020 Capital Budget of US$99 million

Tripling Average Oil Production in 2020 to 13,500 bopd, targeting to exit at 20,000 bopd

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - January 21, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company"), the Peruvian focused E&P company, is pleased to announce its 2020 capital program of US$99 million, expected to be fully funded with funds generated from operations and existing cash resources. This capital program will allow PetroTal to become a free cash-flowing company and reach 20,000 barrels of oil per day ("bopd") from the Bretaña oil field, operated 100% by PetroTal, before year-end 2020. All amounts are quoted in US dollars.

HIGHLIGHTS:

- Drill four horizontal oil production wells and a second water disposal well.
- Accelerate commissioning of the second phase of central processing facilities ("CPF-2") to late August.
- Triple last year's average production to 13,500 bopd.
- Target a 2020 exit rate of 20,000 bopd.

2020 CAPITAL BUDGET

Based on the successful results of the most recent horizontal wells (5H and 4H), PetroTal will drill four new horizontal oil production wells in 2020 and a second water disposal well. The new horizontal wells will have an average cost of $13 million per well, and will include longer lateral sections (more than 1,000 meters) in addition to being completed with automatic inflow control devices ("AICD"). To accommodate associated water production, another water disposal well will be drilled in the western flank of the field at a cost of $9 million, inclusive of a coring program to further refine Bretana's oil-in-place estimates.

Based on the Company's operating experience of optimizing oil production rates in excess of nameplate facility capacities, CPF-2 is now designed for a nominal processing capacity of 15,000 bopd. This will enable total field facility capacity to handle approximately 24,000 bopd. It will also reduce the CPF-2 estimated investment to $22 million, leading to a saving of approximately $5.5 million from the original estimate. Enhancements to the loading dock to handle larger oil volumes and optimal integration of the CPF-1 and CPF-2, will require $9 million. Fast tracking CPF-2 to commence commissioning by late August will allow us to achieve our average oil production target along with handling increased oil production coming from the new horizontal oil wells to be drilled in 2020.

The remaining capital investments include the environmental drilling permit for the Constitucion prospect in Block 107, an environmental seismic permit over the Envidia prospect and a couple of other leads in Block 95, as well as abandonment costs for a legacy asset in accordance with regulatory obligations. Approximately $8 million of the 2020 Capital Budget represents projects carried forward from 2019, with about $4 million carried forward for the completion and commissioning of the CPF-1.

PRODUCTION GUIDANCE

With this capital program, the Company expects 2020 average production to range between 12,500 bopd and 14,500 bopd with an average target of 13,500 bopd, representing a 227% increase from the 2019 average production of 4,131 bopd, and 74% above the Q4 2019 average production of 7,757 bopd. The 2020 exit production rate is expected to be 20,000 bopd, a significant increase from the 2019 exit rate of 13,300 bopd.

In the first half of 2020, the Company will drill one new oil production well and one water disposal well after the drilling rig has completed its annual maintenance program; resulting in expected production for the first half to average 10,750 bopd, ranging between 10,000 bopd and 11,500 bopd. This represents a 35% increase from the Q4 2019 oil production average. In the second half of 2020, the Company will drill three new oil production wells and expects that average production will increase to 16,500 bopd, ranging between 15,500 bopd and 17,500 bopd.

CAPITAL PROGRAM FUNDING

Based on this production guidance and utilizing an average forward strip Brent oil price of $61.60 per barrel, the Company expects to fully fund the 2020 capital program with funds generated from operations and available cash resources; setting the stage to become a free cash flowing company by year-end 2020.

Manolo Zuniga, President and Chief Executive Officer, commented:

"We are pleased with the success the Company has achieved to date developing the Bretaña oil field and plan to build on that success in 2020. PetroTal's Board has approved the 2020 capital budget which is similar in scope to last year. and we are confident in our ability to execute it. With each new well drilled, we better understand the underlying reservoir, thereby enhancing our confidence in continued, focused growth in our two Peruvian blocks. The current and expected oil production levels provide a solid base which optimizes our cost structure and generates significant funds from operations.

Building on the 2018 goal of putting the original oil well online in just five months, 2019 became a successful catalyst year for determining the oil fields' capacity for strong organic growth. 2020 is the year we expect to grow into a Company with long term production and cash flow stability. PetroTal remains committed to bring about a beneficial change for the populations within its scope of influence in the region. I sincerely thank the entire PetroTal team and Board, as well as all our shareholders, for their continued support.

Qualified Person's Statement

Estuardo Alvarez-Calderon, the Company's Vice President, Exploration and Development, who has over 35 years of relevant experience in the oil industry, has approved the technical information contained in this announcement. Mr. Alvarez-Calderon received a Bachelor of Science degree in Geology from the University of Texas at Austin and is registered on the Texas Board of Professional Geoscientists.

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐quoted (TSXV: TAL) (AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's flagship asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018, six months after acquisition, and within 18 months has exceeded the initial 10,000 bopd goal. Additionally, the Company has large exploration upside and is actively engaged to find a partner to drill the Osheki prospect and other prospects in Block 107. The Company's management team has significant experience in developing and exploring for oil in all of Peru's oil producing basins and is led by a Board of Directors that is focused on safely and cost effectively developing the Bretaña oil field. More information on the Company can be found at www.PetroTal‐Corp.com.

For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedar.com, or below:

Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101

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

Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T : 44 (0) 208 434 2643

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

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

Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Nicholas Rhodes / Ashton Clanfield
Tel: +44 (0) 20 7710 7600

READER ADVISORIES

FORWARD-LOOKING STATEMENTS: This news release contains forward-looking statements. More particularly, and without limitation, this news release contains statements concerning PetroTal's assessment of future plans and operations and the appointment of new directors of the Company. When used in this document, the words "will," "anticipate," "believe," "estimate," "expect," "intent," "may," "project," "should," and similar expressions are intended to be among the statements that identify forward-looking statements. The forward-looking statements are founded on the basis of expectations and assumptions made by PetroTal. Although PetroTal believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to: PetroTal may not obtain the required approvals from the TSX Venture Exchange and other factors more fully described from time to time in the reports and filings made by PetroTal with securities regulatory authorities. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three and six months ended June 30, 2019 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.

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/51682


PetroTal Announces 2019 Year-end Oil Production of 13,300 bopd

New 5H horizontal well produced 240,000 barrels of oil over last 30 days

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - January 13, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company"), the Peruvian focused E&P company, is pleased to announce 2019 year-end production of 13,300 barrels of oil per day ("bopd") from the Bretaña oil field, operated 100% by PetroTal.

2019 OIL PRODUCTION

The Company achieved 2019 exit rate production of 13,300 bopd and has averaged 12,500 bopd for the first eleven days of 2020. Average oil production from the Bretaña oil field for the fourth quarter was 7,757 bopd, a 77% uplift on the 4,382 bopd achieved during the third quarter of 2019. In 2019, PetroTal produced just over 1.5 million barrels of oil, representing average oil production of 4,131 bopd, an increase of over 330% from the average production of 958 bopd realized in 2018.

The 5H well continues to perform above expectations and has now produced 240,000 barrels of oil in its first 30 days of operation and is currently producing 6,500 bopd.

Commissioning of the central production facility ("CPF") commenced on December 22, 2019 with the successful hydrostatic test of the new 20,000 barrel oil storage tank. Commissioning will continue for another 30 days while all components are flow tested. During this period, overall oil production at the field is expected to fluctuate.

YEAR END CASH

At December 31, 2019, PetroTal had cash of approximately US$21 million, inclusive of US$15 million received for oil delivered to the ONP pipeline from December 1 to 15 through the previously announced oil sales contract with PetroPeru. Going forward, the Company will receive monthly revenue payments under the terms of this oil sales agreement.

2020 CAPITAL BUDGET AND OUTLOOK

Within a week, the Company intends to announce its 2020 capital budget, which aims at replicating last year's success by more than tripling annual production and achieving a 2020 exit rate of 20,000 bopd. PetroTal plans to achieve this by accelerating commissioning of the next phase of facilities to late August this year instead of year-end 2020.

Manolo Zuniga, President and Chief Executive Officer, commented:

"We're pleased that we were able to exit 2019 at the upper end of the previously announced guidance, a new record oil production level for PetroTal. The entire PetroTal team worked extremely hard to accommodate the strong oil production of the 5H well during the CPF commissioning phase. Additionally, the implementation of the PetroPeru oil sales contract, enables the Company to receive regular monthly revenues for its oil production."

ABOUT PETROTAL

PetroTal is a publicly‐traded, dual‐quoted (TSXV: TAL) (AIM: PTAL) oil and gas development and production company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's flagship asset is the Bretaña oil field in Peru's Block 95 where oil production was initiated in June 2018, six months after acquisition, and within 18 months has exceeded the initial 10,000 bopd goal. Additionally, the Company has large exploration prospects and is actively engaged to find a partner to drill the Osheki prospect and other leads in Block 107. The Company's management team has significant experience in developing and exploring for oil in all of Peru's oil producing basins and is led by a Board of Directors that is focused on safely and cost effectively developing the Bretaña oil field. More information on the Company can be found at www.PetroTal‐Corp.com.

For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedar.com, or below:

Douglas Urch
Executive Vice President and Chief Financial Officer
Durch@PetroTal-Corp.com
T: (713) 609-9101

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

Celicourt Communications
Mark Antelme / Jimmy Lea
petrotal@celicourt.uk
T : 44 (0) 208 434 2643

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

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

Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Nicholas Rhodes / Ashton Clanfield
Tel: +44 (0) 20 7710 7600

READER ADVISORIES

FORWARD-LOOKING STATEMENTS: This news release contains forward-looking statements. More particularly, and without limitation, this news release contains statements concerning PetroTal's assessment of future plans and operations and the appointment of new directors of the Company. When used in this document, the words "will," "anticipate," "believe," "estimate," "expect," "intent," "may," "project," "should," and similar expressions are intended to be among the statements that identify forward-looking statements. The forward-looking statements are founded on the basis of expectations and assumptions made by PetroTal. Although PetroTal believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to: PetroTal may not obtain the required approvals from the TSX Venture Exchange and other factors more fully described from time to time in the reports and filings made by PetroTal with securities regulatory authorities. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three and six months ended June 30, 2019 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.

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/51359