PetroTal Announces Completion of 8H Horizontal Well with Record Production of Nearly 8,000 Barrels of Oil per Day

Bretana oil field production surpasses 2019 highwater mark

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - September 15, 2021) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) (OTC Pink: PTALF) ("PetroTal" or the "Company") has completed the BN-8H ("8H") well, PetroTal's fourth horizontal well in the Bretana oil field.

Bretana field achieves record production of approximately 15,400 bopd

PetroTal commenced production of its fourth horizontal well 8H on September 4, 2021 with unrestricted flow rates of approximately 7,600 barrels of oil per day ("bopd") over a ten-day period. Selected highlights are as follows:

  • Initial 8H production rates of 7,500 - 8,000 bopd; and,
  • Total current field production is now approximately 15,400 bopd, a record production level for PetroTal.

Completion of well 8H below budget

  • The 8H well cost came in 3% under budget, at US$11.8 million;
  • 8H estimated payout of 8-10 weeks production based on current Brent oil strip, assuming unrestricted rates;
  • Well 8H targeted oil sand intersected 4 meters higher than prognosed; and,
  • The horizontal section of the 8H well was completed with autonomous inflow control device technology ("AICD"), which will better control water influx.

North Peruvian Pipeline ("ONP") Update

PetroTal was able to achieve record field production rates at Bretana due to the ONP being operational again, allowing the Company to unload the approximately 140,000 barrels of oil stored in barges at Pump Station No.1. The ability to store oil in barges combined with back-to-back exports to Brazil and deliveries at the Iquitos Refinery have proven PetroTal's ability to manage ONP disruptions.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:

"The initial flow rates from well 8H are very exciting and echo the profile of the prolific 5H horizontal well. Similarly, the clean sands of the 8H well reflect what we have observed in the recently drilled 7D well and the cores obtained in the 3WD water disposal well. It is also rewarding that we have now achieved a new record field production level of 15,400 bopd. The flush production seen from 8H is being monetized into some of the highest Brent oil price markets we have seen all year, providing a significant cash flow impact. Over the next few weeks, we expect to commence drilling the next horizontal well ("BN-9H") in our 2021 campaign. On behalf of PetroTal, I would like to take this opportunity to thank Prime Minister Guido Bellido and the Minister of Energy and Mines, Ivan Merino Aguirre, for responding to the ONP communities' concerns with in-person negotiations to resolve the matter quickly and peacefully that allowed us to achieve this new record production."

ABOUT PETROTAL

PetroTal is a publicly traded, tri‐quoted (TSXV: TAL) (AIM: PTAL) (OTC Pink: PTALF) 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 Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018. In early 2020, Petrotal became the second largest crude oil producer in Peru. The Company's management team has significant experience in developing and exploring for oil in Peru and is led by a Board of Directors that is focused on safely and cost effectively developing the Bretana oil field. It is actively building new initiatives to champion community sensitive energy production, benefiting all stakeholders.

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

PetroTal Investor Relations
InvestorRelations@PetroTal-Corp.com

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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright
T: +44 (0) 7711 627449

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; oil production levels, well payout production and the ability of the Company to achieve near term production targets; anticipated future production and revenue; continued operation of the ONP and PetroTal's access thereto, the Company's expectations regarding netbacks and free cash flow; and future development and growth prospects. All statements other than statements of historical fact may be forward-looking statements. In addition, statements relating to expected production, reserves, recovery, costs and valuation are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "believe", "expect", "plan", "estimate", "potential", "will", "should", "continue", "may", "objective" and similar expressions. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, the ability of the Ministry of Energy to effectively achieve its objectives in respect of reducing social conflict and collaborating towards continued investment in the energy sector, reservoir characteristics, recovery factor, exploration upside, prevailing commodity prices and the actual prices received for PetroTal's products, including pursuant to hedging arrangements, 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 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 most recent management's discussion and analysis and the most recent annual information form 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 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. The Company cautions that such results should be considered to be preliminary.

RESERVES DISCLOSURE: The reserve estimates contained herein were derived from a reserves assessment and evaluation prepared by Netherland Sewell Associates, Inc., a qualified independent reserves evaluator, with an effective date of December 31, 2020 (the "NSAI Reserves Report"). The NSAI Reserves Report has been prepared in accordance with definitions, standards and procedures contained in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51 101") and the most recent publication of the Canadian Oil and Gas Evaluation Handbook (the "COGE Handbook") The reserve estimates contained herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Volumes of reserves have been presented based on the Company's total working interest. Readers should give attention to the estimates of individual classes of reserves and appreciate the differing probabilities of recovery associated with each category. The estimates of reserves for individual properties may not reflect the same confidence level as estimates of reserves for all properties, due to the effects of aggregation.

TYPE CURVES: Certain type curve disclosure presented herein represents estimates of the production decline and ultimate volumes expected to be recovered from wells over the life of the well. The type curves represent what management thinks an average well will achieve, based on methodology that is analogous to wells with similar geological features. Individual wells may be higher or lower but over a larger number of wells, management expects the average to come out to the type curve. Over time type curves can and will change based on achieving more production history on older wells or more recent completion information on newer wells. Additional details on well performance and management's type curves are available in the presentation on PetroTal's website at www.petrotal-corp.com.

OIL REFERENCES: All references to "oil" or "crude oil" production, revenue or sales in this press release mean "heavy crude oil" as defined in NI 51-101. All references to Brent indicate Intercontinental Exchange ("ICE") Brent.

NON-GAAP MEASURES: This press release contains financial terms that are not considered measures under generally accepted accounting principles ("GAAP") such as operating netback and free cash flow that do not have any standardized meaning under GAAP and may not be comparable to similar measures presented by other companies. Management uses these non-GAAP measures for its own performance measurement and to provide shareholders and investors with additional measurements of the Company's efficiency and its ability to fund a portion of its future capital expenditures. Netback is calculated by dividing net operating income by barrels sold in the corresponding period. Free cash flow is operating cash flow before hedging minus maintenance capital expenditures. Please refer to the most recent management's discussion and analysis for additional information relating to non-GAAP measures.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about PetroTal's prospective results of operations, production and well payout production, 2021 capital program and budget, free cash flow 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 NI 51-101.

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

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/96552


PetroTal Announces Q2 2021 Financial and Operating Results

PetroTal completes 8th producing well, increases water disposal capacity, and outperforms Q2 2021 production guidance under restricted flow conditions

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - August 26, 2021) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") is pleased to announce its financial and operating results for the six ("H1") and three months ("Q2") ended June 30, 2021.

Selected financial and operational information is outlined below and should be read in conjunction with the Company's unaudited consolidated financial statements ("Financial Statements"), and management's discussion and analysis ("MD&A") for Q2 2021, which are available on SEDAR at www.sedar.com and on the Company's website at www.PetroTal‐Corp.com. All amounts herein are in United States dollars ("USD") unless otherwise stated.

Highlights:

  • Outperformed Q2 2021 production guidance by 2% and Q1 2021 production by 21%, delivering 8,839 bopd under constrained production conditions, as previously described in the Company's July 20, 2021 RNS;
  • Generated a significant increase in revenue of $42.8 million ($53.20/bbl) in Q2 2021 versus $32.4 million ($41.91/bbl) in Q1 2021;
  • Achieved record netback and net operating income in Q2 2021 of $36.88/bbl and $29.7 million, respectively;
  • Operating and direct transportation costs in Q2 2021 were $10.8 million ($13.45/bbl) as compared to $10.6 million ($13.78/bbl) in Q1 2021;
  • Generated free cash flow(1), before leverage and working capital adjustments, in Q2 2021 of $2.4 million and in H1 2021 of $11.5 million, a record for the Company;
  • Strong liquidity position, building total cash quarter over quarter to over $79.5 million as at June 30, 2021 up 5% from March 31, 2021. $25.4 million of total cash is restricted;
  • Net income of $11.4 million for the quarter, demonstrating an efficient operating cost structure, attractive capital base, and supportive fiscal terms;
  • All Q2 2021 bond covenants met with substantial headroom. The Company exited Q2 2021 with a 0.41x leverage ratio which included $40.6 million of net debt calculated per the bond indenture;
  • Continued to de-risk commodity price exposure that brings the total corporate hedge percentage to 44% for the remaining four months of 2021 forecast production, protecting prices of $60/bbl Brent;
  • Necessary modifications to the water disposal system are ongoing. The field can now actively dispose of approximately 80,000 barrels of water per day ("bwpd") and 100,000 bwpd when the modifications are completed in September;
  • Achieved payback on well 7D, approximately 2.5 months post completion;
  • Current constrained production is 8,513 bopd (last seven-day average to August 20, 2021). Unrestrained production is expected to be restored in September;
  • Revised H2 2021 production guidance as a result of a rescheduled and deferred drilling program stemming initially from the COVID-19 protocol's impact and from the water disposal well drilling delays. The 2021 average production range is now guided at 10,000 to 11,000 bopd (from 11,000 - 12,000 bopd). Exit December 2021 production has been slightly revised down to 17,000 - 18,000 bopd (from 18,000 - 19,000 bopd), as the impact of the BN-10H well won't be incorporated until early next year;
  • Updated 2021 EBITDA(1) guidance is between $140 - $145 million for 2021, up materially from the original 2021 $90 million budget;
  • Successfully drilled BN-8H subsequent to the quarter end which is now being completed, and expected to be on time and under budget;
  • Demonstrated importance of an expanded oil marketing strategy with two scheduled Brazilian cargos contracted subsequent to the quarter end;
  • Enhanced the Company's long-term sustainability vision by establishing distinct objectives and performance measurements; and,
  • Advanced government and community relations, ratifying the process of social profit share in nearby communities around PetroTal's oil operations.

    (1) For a description of EBITDA and free cash flow, see Reader Advisories - Non-GAAP Measures below.

Q2 2021 Webcast conference call

The Company will be hosting a conference call on August 26, 2021 at 9:00am Houston time. The link for the live webcast is below:

https://webcasting.brrmedia.co.uk/broadcast/6113a8920ddc2b060ef52b06

Selected Financial Highlights

Three Months Ended   Six Months Ended
                         
(in thousands USD) June 30, 2021 June 30, 2020   June 30, 2021   June 30, 2020
Financial          
  Crude oil revenues $ 42,809 $ 7,413   $ 75,165   $ 39,658
  Royalties (2,306) (123)   (4,054)   (1,929)
  Net operating income 29,678 2,756   49,647   20,565
  Commodity price derivative (income)/loss 4,147 (18,264)   (18,365)   22,156
  Net income (loss) 11,374 16,029   42,159   (15,423)
  Basic and diluted net income (loss)(US$/share) 0.01 0.02   0.05   (0.02)
  Capital expenditures 22,363 8,756   29,476   $ 32,628
Operating          
  Average production (bopd) 8,839 4,185   8,089   6,936
  Average sales (bopd) 8,842 4,729   8,711   7,521
  Average Brent price ($/bbl) 68.83 29.19   64.28   39.67
  Contracted sales price, gross ($/bbl) 66.55 27.30   62.79   42.40
  Netback (US$/barrel) 36.88 6.40   31.49   15.02
  Funds flow provided by (used in) operations 19,627 15,337   24,094   14,611
Balance sheet          
  Cash and restricted cash       79,491   20,379
  Working Capital       62,634   (31,845)
  Total assets       359,788   216,899
  Current liabilities       72,639   76,932
  Equity       180,291   122,789

 
Note:
(1) Funds flow provided by (used in) operations and netback do not have any standardized meaning prescribed by GAAP and therefore may not be comparable with the calculation of similar measures for other entities. See "Non-GAAP Measures".


Q2 2021 Selected Operational Highlights

Completed the 7D well on April 30, 2021. The well was drilled and completed at a revised final cost of $7.6 million, or 17% below budget. Shortly after completion the well achieved rates in excess of 4,500 bopd, is performing well above type curve expectations, and has achieved payback in 2.5 months.

Commenced drilling and coring of the 3WD (water disposal) well. PetroTal commenced drilling and coring of the 3WD well on May 3, 2021, which was completed subsequent to the quarter end on July 9, 2021. The overall operation and coring program on 3WD were a success, with two cores cut allowing for a more thorough oil in place estimate for the 2021 year-end reserves assessment. The completion of the 3WD well also increased water disposal capacity to 80,000 bwpd which provides enough capacity to achieve near term production targets.

Outperformed Q2 2021 production guidance under restricted flow conditions. Production averaged 8,839 bopd for Q2 2021 compared to guidance of 8,655 bopd. This was 2% above guidance, 21% above Q1 2021, and 111% above Q1 2020 levels which were impacted by the COVID-19 pandemic. Current field production is now 8,513 bopd. Production was largely constrained during the quarter and during the period subsequent due to operational delays on one of the water disposal booster pumps, thereby reducing water disposal rates. The water disposal modifications are still being completed and water disposal capacity has returned to an estimated 80,000 bwpd with water now being injected into both the 2WD and 3WD wells. A new 10" pipeline connection to the facility water tanks was also installed to increase water injection rates. When completed, total available water disposal capacity will be 100,000 bwpd.

Revised H2 2021 guidance. Due to the recent drilling delay, that pushes the impact of the BN-10H well to early next year, PetroTal has rescheduled its H2 2021 development drilling plan. As a result, PetroTal is now scheduled to bring two additional wells onstream in 2021 instead of the previously planned three. The third well is now expected onstream in January 2022. Accrued drilling costs on the deferred well will still materially be captured in Q4 2021, with January 2022 now receiving the flush production benefit instead of December 2021. Capital expenditures are still materially on budget at approximately $100 million for 2021.

2021 Guidance Summary New Original Variance
Average 2021 Brent Price ($/bbl) $67.30/bbl $50.00/bbl $17.30/bbl
2021 Production Range (bopd) 10,000 - 11,000 11,000 - 12,000 (0-1,000)
Q3 2021 Production (bopd) 9,500 - 10,000 11,500 - 12,500 (1,500-3,000)
Q4 2021 Production (bopd) 16,000 - 16,500 16,000 - 17,000 (0-500)
2021 Exit Production (bopd) 17,000 - 18,000 18,000 - 19,000 (1,000)
Oil Wells Commenced 4 5 (1)
Oil Wells Completed 3 4 (1)
EBITDA $140 - $145 million $90 million $50-$55 million
EBITDA Netback ($/bbl) $35.50/bbl $21.40/bbl $14.10/bbl

 

Completed drilling of BN-8H on August 18, 2021. The well was successfully drilled to a final depth of 4,200 meters as expected on August 18, 2021. A total of 1,137 meters of 6-1/8" horizontal section was drilled in very well-developed oil reservoir sands of the Vivian formation. Completion operations are currently ongoing on the BN-8H well and is on track for completion in early September. Post completion of BN-8H, the rig will commence drilling the next horizontal development well ("BN-9H") using a synthetic mud system with a larger diameter drill pipe.

CPF-2 commissioning rescheduled. Due to COVID-19 quarantine protocols, contractor personnel were removed from the field which delayed CPF-2 commissioning work. Startup is now rescheduled for late November and early December for the oil and water treatment infrastructure. The rescheduling is not expected to impact the ability for the field to handle new flush production rates.

Sales and Marketing update. The long-term Brazil export contract PetroTal signed in Q1 2021 is playing a key role in ensuring our ability to maintain oil production from any pipeline disruptions. Two ongoing back-to-back exports via Brazil have allowed us to maintain production during a recent social dispute that shut down Petroperu's ONP pump station one near Saramurillo, in late July 2021. The disruption is expected to be resolved shortly with pipeline operations restored thereafter. As part of PetroTal's new diversified marketing strategy, the Company was able to secure two back-to-back ~240,000 bbl cargo shipments to Brazil in Q3 2021 and sold FOB Bretana. Netbacks from these sales are competitive with the ONP, and PetroTal anticipates no sales disruptions due to the ONP closure. We are working diligently with Petroperu and the Peruvian Government, as well as Saramurillo's leaders, to provide assistance, as needed.

Q2 2021 Selected Financial and Corporate Highlights

Significant liquidity and working capital in hand. PetroTal continues to strengthen its liquidity position. Q2 2021 ending cash totaled $79.5 million, up $3.6 million from March 31, 2021 and up $59.1 million from June 30, 2020 due to proceeds from the Q1 2021 bond issuance. Current net working capital (defined as current assets less current liabilities) continues to show a strong position, ending Q2 2021 in a $62.6 million surplus position vs a $68.2 million surplus ending in Q1 2021. At June 30, 2021, accounts payable and accrued liabilities were approximately $38.6 million.

Record Net Operating Income ("NOI"). PetroTal generated a record $29.7 million ($36.88/bbl) of NOI in the quarter, an increase of $26.9 million over Q2 2020 and $9.7 million over Q1 2021, due to higher realized Brent prices and increased oil production.

Lower per barrel operating costs. Operating costs were flat quarter over quarter at $10.8 million for Q2 2021 versus $10.6 million for Q1 2021 despite the price of diluent increasing significantly in conjunction with the Brent oil price. On a per barrel basis, total operational costs were down 2% at $13.45/bbl in Q2 2021 versus $13.78/bbl in Q1 2021.

Strong royalty profile. Royalties for the quarter were $2.3 million or $2.87/bbl versus $1.7 million or $2.26/bbl in Q1 2021. The increase was due to higher realized Brent prices and higher production for Q2 2021.

Capital expenditures ("CAPEX"). Capital expenditures for Q2 2021 totaled $22.4 million, up 215% from Q1 2021 due to active drilling activity for the majority of the quarter versus little activity in Q1 2021. In total, year to date expenditures were $29.5 million which is $16.5 million below guidance due to the rescheduling of various facility and infrastructure projects into H2 2021. The CPF-2 completion and commissioning dates are now expected late in 2021.

Positive free cash flow generation in H1 2021. PetroTal is pleased to announce it generated record free cash flow in H1 2021 (before changes in working capital), with Q2 2021 contributing another $2.4 million to free cash flow in a drilling heavy quarter. H1 2021 funds flow from operations (before working capital adjustments) totaled $40.9 million, and after total capital expenditures of $29.5 million, resulted in a total of $11.5 million of free cash flow in H1 2021. This was due to robust H1 2021 Brent prices, deferred infrastructure projects into H2 2021 and favorable operating costs. PetroTal estimates that it will continue to generate free cash flow in H2 2021.

Continued positive Net Income. Net income for Q2 2021 was $11.4 million versus $16.0 million in Q2 2020 and $30.8 million in Q1 2021. Based on low cumulative capital of approximately $184 million invested in the asset since 2018, favorable commodity prices and a strong operating cost structure, continued positive earnings are anticipated. For Q2 2021, a $4.1 million derivative loss was realized versus $22.5 and $18.3 million derivative gains in Q1 2021 and Q2 2020, respectively.

Derivative Asset. PetroTal continues to recognize a material derivative asset on its balance sheet. At June 30, 2021, the Company recorded a $31.2 million derivative asset and a $1.4 million derivative liability versus a $39.7 million derivative asset at March 31, 2021 and a $22.5 million liability at June 30, 2020. When the Q1 2021 bond proceeds were received the derivative liability was extinguished and hedges were put in place on oil moving through the ONP. The difference between the Brent prices creating the extinguished liability and the prices at hedged strip created the derivative asset that the Company will continue to realize throughout H2 2021 and early 2022, as physical sales at the port of Bayovar occur by Petroperu. To date, the Company has realized a cash gain of $7.1 million in true up revenue with the remainder of production in the ONP secured by hedges to be received over the next 12 months.

Hedging Update. At June 30, 2021 the Company has outstanding corporate hedges on approximately 677,481 bbls in both put and synthetic put structures expiring from July to Dec 2021. On August 23, 2021 the Company layered in additional hedges totaling 304,626 bbls using a put structure with $60/bbl strike prices, bringing the percentage of hedged forecast volumes to 44% for September to December 2021. In partnership with Petroperu, the Company also has approximately 2.24 million barrels hedged in the ONP, with approximately 80% of barrels locked in between $60 and $62/bbl Brent and more recent hedges, totaling approximately 20% of barrels in the ONP, hedged at approximately $70/bbl Brent.

Strong Balance Sheet. PetroTal reported net debt of approximately $22.7 million as at June 30, 2021 as calculated for valuation purposes, which includes balance sheet derivatives and $40.6 million as calculated for bond covenants. For bond covenant purposes, the Q2 2021 net debt to adjusted EBITDA covenant was 0.41x against a maximum ratio of 3.0x leaving substantial buffer room to withstand potential commodity price volatility and / or accretive M&A transactions.

2020 Sustainability Report Long Term Vision

As previously announced, PetroTal's 2020 sustainability report is available on the Company's website. In addition, PetroTal is in the process of finalizing its long term sustainability objectives and targets for 2023, 2025, and 2030. Below, are the key components that summarize the long term vision:

Environmental Commitment - emissions, use of technology, climate impact, waste management, biodiversity, accident prevention.

Shared Values and Alignment - community alignment and commitment, supplier process, talent and community training and development.

Governance - Ethics management, risk management, human rights, inclusion, macroeconomic values.

Health and Safety - safety of employees, suppliers and contractors.

Detailed objectives have been drafted and set by management with measurement and outcomes currently being finalized and approved by the board of directors. Details will be available to investors on the PetroTal website in the coming quarters.

Recent Project Nomination. PetroTal is pleased to announce that it has been recognized as one of three companies in the oil and gas sector for its citizen socio environmental monitoring program (PROMOSAC). The formal document from the Ministry of Energy is now available here:
https://cdn.www.gob.pe/uploads/document/file/2069295/Programa%20de%20Reconocimiento%20CER%20_Julio2021.pdf.pdf

Community Relations Update. On August 10th, 2021, the Minister of Energy and Mines, Ivan Merino Aguirre, met with a delegation of PetroTal management that included Manolo Zuniga, CEO of PetroTal. Management presented various proposals that will promote continued investment in the energy sector and encourage collaboration between the Ministry and Company. The Company renewed its commitment to work directly with local communities in the Puinahua District of Bretana, to promote investment and training to further harmonize relations between operators. In turn, the Ministry offered assurances that social profitability and peace will be applied directly with community leaders from PetroTal's resource operations to avoid intermediaries and thereby reducing potential social conflict. The news article can be found here: https://bit.ly/2VziOgx

In addition, Manolo Zuniga, attended recent anniversary meetings with families and associates impacted by the violent social demonstration that occurred outside Bretana just over a year ago. The Company delegation offered families condolences, support, and assistance for remembrance and respect for the lives that were lost.

Updated Corporate Presentation. Please see PetroTal's website for an updated version.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented

"We are pleased to share our strong second quarter results which demonstrate continued operational success and resilience in the face of challenges. Our Q2 2021 results were strong, contributing to record net operating income, netbacks, and free cash flow in Q2 2021 and H1 2021 which we anticipate will continue in H2 2021. Despite the water disposal bottlenecks and drilling delays we slightly outperformed production guidance in Q2 2021. With the booster pump issue now fixed and new pipeline infrastructure being put in place we will be able to utilize full water disposal capacity. Wells BN-8H and 9H, on production in H2 2021, are anticipated to lift PetroTal's production to record levels. We are also again reminded that our battle with COVID-19 is not to be underestimated, as we experienced some CFP-2 installation delays which, fortunately should not impact the Company's ability to bring on new oil production in H2 2021. The Company continues to allocate appropriate capital to fighting the COVID-19 pandemic and make health and safety a top priority for all our employees and contractors."

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 Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, and in early 2020 became the second largest crude oil producer in Peru. 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 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 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

PetroTal Investor Relations
InvestorRelations@PetroTal-Corp.com

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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright
T: +44 (0) 7711 627449

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, completions, workovers and other activities and the anticipated costs and results of such activities; the ability of the Company to achieve drilling success consistent with management's expectations; the ability of the Company to achieve near term production targets; anticipated future production and revenue; drilling plans including the timing of drilling, commissioning, and startup; startup plans for oil and water treatment infrastructure, including the timing of startup plans and the impact of delays thereon; oil production levels, including average production and exit production in 2021; the 2021 capital program and budget, including drilling plans; expectations regarding accrued drilling costs on deferred wells and allocation of flush production benefits; the timing of river embankment erosion work; COVID-19 surveillance and control process; hedging program, the terms thereof, and the Company's expectations regarding its hedged positions; cargo loading and shipments, including the timing of loading and shipping and expectations regarding sales from cargo shipments; the Company's expectations regarding net operating income, netbacks, liquid net working capital and free cash flow; the Company's long-term sustainability objectives and targets, and the timing thereof; the Company's proposals for continuous investment in the energy sector and collaboration with local communities; and future development and growth prospects. All statements other than statements of historical fact may be forward-looking statements. In addition, statements relating to expected production, reserves, recovery, costs and valuation are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "believe", "expect", "plan", "estimate", "potential", "will", "should", "continue", "may", "objective" and similar expressions. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, the ability of the Ministry of Energy to effectively achieve its objectives in respect of reducing social conflict and collaborating towards continued investment in the energy sector, reservoir characteristics, recovery factor, exploration upside, prevailing commodity prices and the actual prices received for PetroTal's products, including pursuant to hedging arrangements, 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 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 MD&A and the most recent annual information form 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 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. The Company cautions that the such results should be considered to be preliminary.

OIL REFERENCES: All references to "oil" or "crude oil" production, revenue or sales in this press release mean "heavy crude oil" as defined in NI 51-101. All references to Brent indicate Intercontinental Exchange ("ICE") Brent.

NON-GAAP MEASURES: This press release contains financial terms that are not considered measures under generally accepted accounting principles ("GAAP") such as EBITDA, EBITDA netback, operating netback, funds flow provided by operations, liquid net working capital and free cash flow that do not have any standardized meaning under GAAP and may not be comparable to similar measures presented by other companies. Management uses these non-GAAP measures for its own performance measurement and to provide shareholders and investors with additional measurements of the Company's efficiency and its ability to fund a portion of its future capital expenditures. EBITDA is calculated as consolidated net income (loss) before interest and financing expenses, income taxes, depletion, depreciation and amortization adjusted for certain non-cash, extraordinary and non-recurring items primarily relating to unrealized gains and losses on financial instruments and impairment losses. PetroTal utilizes EBITDA as a measure of operational performance and cash flow generating capability. EBITDA impacts the level and extent of funding for capital projects investments. EBITDA netback is calculated as EBITDA divided by the number of barrels sold in the period. The Company considers operating and EBITDA netbacks to be a key measure as they demonstrate Company's profitability relative to current commodity prices. Netback is calculated by dividing net operating income by barrels sold in the corresponding period. Funds flow provided by operations, is a non-GAAP measure that includes all cash generated from operating activities and is calculated before changes in non-cash working capital. A reconciliation from cash provided by operating activities to funds flow provided by operations is included in the MD&A. Liquid net working capital is a measure that includes cash, receivables, payables and short-term obligations. Free cash flow is operating cash flow before hedging minus maintenance capital expenditures.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about PetroTal's prospective results of operations, production and production capacity, 2021 capital program and budget, cash flow profile, free cash flow, liquidity 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 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.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/94443


PetroTal Announces Q2 2021 Operations Update

PetroTal completes water disposal well, commences drilling next horizontal well (BN-8H), and exits Q2 2021 with strong cash liquidity

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - July 20, 2021) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") is pleased to announce the following operational update for Q2 2021. All currency amounts are in United States dollars (unless otherwise stated).

Highlights:

  • Q2 2021 production averaged 8,825 barrels of oil per day ("bopd") which was 2% higher than guidance of 8,655 bopd;
  • PetroTal completed its second water disposal well ("3WD"), thereby potentially doubling its produced formation water disposal capacity to approximately 100,000 barrels of water per day ("bwpd") once the CPF-2 facilities are completed;
  • Two cores were successfully recovered from the 3WD which should enhance reservoir models and understanding of Bretana's oil in place estimates;
  • The 7D oil well continues to outperform expectations producing approximately 260,000 barrels of oil since it started producing on April 30, 2021. The well achieved payout in early July and has averaged over 2,500 bopd from July 1 to July 16, 2021;
  • PetroTal is currently producing a constrained 8,800 bopd and successfully disposing of all the produced formation water into the 2WD and 3WD water disposal wells, however, water disposal pumping capacity is operating at reduced levels. Over the next month, the Company will continue optimizing water disposal pumping capacity to further enhance production rates to 10,000 bopd;
  • Drilling commenced on the Company's next horizontal well (BN-8H) on July 12, 2021. The BN-8H well should be completed by early September at a cost of $12.25 million and is expected to boost field production to over 13,000 bopd;
  • Phase two of PetroTal's central processing facility ("CPF-2") is on track for Q4 2021 completion;
  • Total cash liquidity at June 30, 2021, was approximately $79 million, of which $54 million is unrestricted. At June 30, 2021, accounts payable and accrued liabilities were approximately $37 million; and,
  • As part of PetroTal's commitment to our local stakeholders, the Company recently joined the Indigenous Chamber of Commerce of Peru and was also recognized by The Ministry of Energy and Mines (MINEM) for Community Citizen Socio-Environmental Monitoring Program ("PROMOSAC"), developed with community participation, reflective of the Company's focus on community support.

Completion of two new wells. PetroTal commenced drilling a second water disposal well, 3WD, on May 3, 2021. It was successfully completed on July 9, 2021, approximately one month later than the original estimate due to a required sidetrack. Despite the drilling delay, and inclusive of the coring operation, the total well cost is expected to be $11.9 million, compared to the budget of $9.8 million. The additional expenditure is partially offset by cost savings on the 7D development well that was completed in late April 2021 and has already accumulated approximately 260,000 barrels of oil and achieved payout in early July.

Valuable reservoir data collected. Two cores were cut and recovered while drilling the 3WD well, one from the top of the Vivian oil reservoir and the second throughout the oil-to-water transition zone that shows a better-than-expected shorter transition zone. This will be verified by the ongoing petrophysical studies, allowing for a more thorough estimate of oil in place for the 2021 year-end reserves assessment.

Q2 2021 oil production. As stated in the May 31, 2021 announcement, current production levels were approximately 9,000 bopd inclusive of well shut ins, and as a result of drilling delays, created a restricted production level for most of Q2 2021. Q2 2021 oil production averaged 8,825 bopd, up 20% from 7,331 bopd in Q1 2021, and 2% higher than guidance of 8,655 bopd. Current field production is 8,800 bopd and while the 3WD water disposal well has now been completed, one of the booster pumps is not fully operational, constraining water injection rates. This results in current field oil production being constrained just below 9,000 bopd. The booster pump is expected to be either repaired or replaced over the next month, allowing PetroTal to restore production rates to the unencumbered 10,000 bopd level.

Horizontal well BN-8H has commenced drilling. Drilling of the next horizontal development well ("BN-8H") commenced on July 12, 2021, and is expected to cost $12.25 million. The well will take approximately 53 days to drill and complete and is prognosed to be 4,200 meters in total length. This will be the first horizontal well in 2021 with the last development well, 7D, being a deviated well. The Company expects that, upon completion of the BN-8H and fixing the water pumping disposal capacity, to ramp production to over 13,000 bopd and meet Q3 2021 average production guidance of 11,750 bopd.

CPF-2 nearing completion. The final installations for CPF-2 are ongoing with the crude oil treatment, storage tanks, and water treatment all scheduled for completion in early Q4 2021. This will provide for approximately 100,000 bwpd water disposal capacity.

June 30, 2021 liquidity update. At June 30, 2021, PetroTal had a cash position of approximately $79 million, of which $54 million is unrestricted, $20 million is dedicated to accretive acquisitions and $5 million is collateral for commodity price hedges. Accounts receivable from current oil sales, including VAT, is $16.7 million, and accounts payable are approximately $37 million. Pursuant to contractual terms with suppliers, approximately $7 million (19%) of the accounts payable balance is due after Q3 2021. Ongoing payments will be managed from expected oil field revenues, internal cash resources, and the $100 million February 2021 secured bond issue proceeds. The Company maintains access to an additional $25 million from the bond issue for potential acquisitions and development drilling.

Recognition by Ministry of Energy and Mines (MINEM). PetroTal is pleased to acknowledge being recognized by MINEM for its Community Citizen Socio-Environmental Monitoring Program ("PROMOSAC"). The Company was one of three, selected out of a group of thirty-three nominations. This award seeks to recognize those Peruvian companies with a strong commitment to local community, the environment, and local social and economic monitoring initiatives. Furthermore, PetroTal is also supporting the Indigenous Chamber of Commerce of Peru and will work closely with this emblematic institution promoting mutually beneficial projects to empower the local communities.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:

"We are pleased to continue meeting our goals even though Peru continues to suffer the consequences of a third Covid-19 wave. After successfully completing the 7D well that continues to outperform our 3P forecast, we completed the 3WD well which will effectively double our water disposal capacity to approximately 100,000 bwpd. We are now starting to drill more of our prolific horizontal wells which are weighted nicely in the back half of the 2021 capital investment program. Despite some operational challenges, the Company was able to slightly beat Q2 2021 production guidance, even considering curtailed production rates. The core data extracted from the 3WD well will be useful for oil in place calibration in our 2021 year-end reserves report. The field is now producing approximately 8,800 bopd and should ramp up quickly as we optimize water disposal operations and prepare to receive production from the new BN-8H oil well in early September which will allow us to take Bretana's oil production to new highs."

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 its 100% working interest in Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, and in early 2020 became the second largest crude oil producer in Peru. 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 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 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

PetroTal Investor Relations
InvestorRelations@PetroTal-Corp.com

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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright / Rupert Holdsworth Hunt / Harry Baker
T: +44 (0) 7711 627449

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, completions, workovers and other activities and the anticipated timing, costs and results of such activities; the ability of the Company to achieve drilling success consistent with management's expectations; anticipated future production and revenue; drilling plans including the timing of drilling; oil production levels; the 2021 capital program and budget, including drilling plans; the scale-up of the central processing facility and the timing thereof; hedging program and the terms thereof; and future development and growth prospects. All statements other than statements of historical fact may be forward-looking statements. In addition, statements relating to expected production, reserves, recovery, costs and valuation are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "believe", "expect", "plan", "estimate", "potential", "will", "should", "continue", "may", "objective" and similar expressions. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, reservoir characteristics, recovery factor, exploration upside, prevailing commodity prices and the actual prices received for PetroTal's products, including pursuant to hedging arrangements, 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 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, 2020 and management's discussion and analysis for the year ended December 31, 2020 and for the three months ended March 31, 2021 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 REFERENCES: All references to "oil" or "crude oil" production, revenue or sales in this press release mean "heavy crude oil" as defined in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101"). All references to Brent indicate Intercontinental Exchange ("ICE") Brent.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about PetroTal's prospective results of operations, production and production capacity, 2021 capital program and budget, cash flow profile, liquidity 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 NI 51-101.

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

Corporate Logo

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/90700


PetroTal Completes First Oil Export Sale through Brazilian Terminal

Initial shipment of 106,000 barrels of oil into Brazil for export to the Atlantic region

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - December 30, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") is pleased to announce the first export of Bretana oil into the Atlantic region through Brazil. This provides PetroTal with an additional option to monetize oil sales, beyond the Company's existing important sales arrangements with Petroperu using the Northern Oil Pipeline ("ONP"), and to the Iquitos refinery. This will facilitate future oil production growth when the Company continues development of the Bretana oil field, targeting to reach 20,000 barrels of oil per day in Q1 2022.

This initial shipment of 106,000 barrels was arranged between PetroTal and Novum Energy Trading, a British Virgin Islands registered Corporation ("Novum"), to establish the viability of Bretana oil exports using the Amazon river through Brazil. In early December 2020, a convoy of barges were loaded at Bretana and have now reached the terminal area near Manaus, Brazil for transfer into a tanker that will deliver the oil to the Atlantic region.

The sale was completed FOB at the Bretana field, where the oil was loaded onto the barges, with the invoice based on the February 2021 ICE Brent oil price forecast, net of transportation costs and export-related fees associated with the Brazilian - Atlantic coast route. The net proceeds of US$2.7 million have been received and are not subject to any further price adjustments when this oil is sold to the end user by Novum.

Based on the success of this initial export shipment, PetroTal and Novum have signed a letter of intent to establish long term sales through Brazil to complement the Company's existing sales arrangements with Petroperu's ONP and the Iquitos refinery. Future export cargos through Brazil are expected to be at least 200,000 barrels and, with the volume efficiencies expected, will result in a higher netback per barrel for PetroTal.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:

"We are pleased that all parties worked seamlessly together to manage the logistics associated with this pilot shipment. This represents a milestone achievement for PetroTal, since having the ability to manage oil sales to both the Pacific and Atlantic coasts provides for maximum flexibility and pricing. The ONP will continue to play an important role in the Company's ongoing growth."

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 Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, and in early 2020 became the second largest crude oil producer in Peru. 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

Manuel Pablo Zuniga-Pflucker
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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright / Rupert Holdsworth Hunt / Harry Baker
T: +44 (0) 7711 627449

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, the members of the board of directors of the Company and the termination of the Relationship Agreement. 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.

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/71158


PetroTal Recommences Oil Sales into the Pipeline

Peruvian government and Indigenous communities reach agreement ending pipeline disruption

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - December 29, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") is pleased to announce that social issues affecting the Northern Oil Pipeline ("ONP"), operated by Petroperu, have now been resolved. As a result, PetroTal has now recommenced oil deliveries at Saramuro (Pump Station #1), for sales into the ONP.

The social disruption had impacted the ONP's operations for 85 days and, as a result of continued dialogue between the indigenous communities and the Peruvian government, an agreement was reached that addresses the community's concerns. Petroperu and PetroTal offered support to all parties to help facilitate the settlement.

Petroperu has commenced pumping oil from Pump Station #1 to Pump Station #5, thereby allowing the awaiting barges to start unloading PetroTal's oil. Petroperu is inspecting a section of the pipeline beyond Pump Station #5 for possible repairs resulting from heavy rains and landslides in that area.

In the interim, PetroTal will continue to control output of oil production to manage sales availability through the ONP storage, Iquitos refinery and other options. Upon full commencement of the ONP operations, expected by mid-January 2021, the Company will again increase oil production to approximately 10,000 barrels of oil per day.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:

"We are pleased that the Peruvian government and indigenous communities have reached resolution on the social concerns, and that PetroTal will be able to again rely on continued availability of the ONP by Petroperu. The ONP serves an important role for all oil producers in the jungle area of Peru and having continuous, reliable operations is a necessity for continued production, development and expansion of Peru's oil resources."

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 Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, and in early 2020 became the second largest crude oil producer in Peru. 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

Manuel Pablo Zuniga-Pflucker
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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright / Rupert Holdsworth Hunt / Harry Baker
T: +44 (0) 7711 627449

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, the members of the board of directors of the Company and the termination of the Relationship Agreement. 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.

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.

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To view the source version of this press release, please visit https://www.newsfilecorp.com/release/71100


PetroTal Announces Secondary Sale of Shares

Remus Horizons replaces Gran Tierra as PetroTal's largest shareholder

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - December 14, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") announces that it has been informed by Gran Tierra Resources Ltd. ("GTRL"), a control person of PetroTal, that GTRL has entered into a private agreement with Remus Horizons PCC Limited ("Remus") in respect of the purchase by Remus of 218,012,500 common shares ("PetroTal Shares") of PetroTal (the "Purchased Shares") at a price of GBP0.099385 per Purchased Share, for an aggregate purchase price of approximately GBP21,667,172 (the "Transaction"). Completion of the Transaction is expected to occur on or about December 18, 2020, subject to a number of conditions being satisfied or waived by one or both of GTRL and Remus. PetroTal is not a party to the agreement and will not receive any proceeds from the Transaction. GTRL has indicated it is disposing of the Purchased Shares for investment purposes.

The Purchased Shares represent approximately 26.7% of the issued and outstanding PetroTal Shares as of the date hereof and Remus will become a new control person of PetroTal following completion of the Transaction. GTRL, a wholly owned subsidiary of Gran Tierra Energy Inc., currently owns 246,100,000 PetroTal Shares, representing approximately 30.15% of the issued and outstanding PetroTal Shares as of the date hereof. Upon closing the Transaction, GTRL will own 28,087,500 PetroTal Shares, representing approximately 3.44% of the issued and outstanding PetroTal Shares as of the date hereof. The remaining 28,087,500 PetroTal Shares are subject to escrow pursuant to the TSX Venture Exchange escrow requirements imposed in connection with the Company's reverse take-over transaction completed in December 2017.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:

"We are very appreciative of the guidance and support provided by Gran Tierra and certainly wish them success in their continued corporate growth. The Peruvian assets and start-up funding provided by Gran Tierra when PetroTal was created in late 2017, formed the nucleus for PetroTal's growth.

"Additionally, we are excited to welcome Remus as PetroTal's largest shareholder. The long term investment focus, along with sound business and social principles of the fund, will provide solid backing for PetroTal. All stakeholders in the Company will benefit from knowing our shareholder base is strong and committed to PetroTal's ongoing growth."

Gary Guidry, President and Chief Executive Officer of Gran Tierra, commented:

"As part of our ongoing commitment to a disciplined financial strategy, with a focus on balance sheet protection and long-term value preservation, we decided to sell the majority of our PetroTal Shares.

"Manolo Zuniga and the entire team at PetroTal have done an excellent job developing the Bretana oil field in Peru and navigating through these very challenging and volatile times in the industry. With a strong board and executive management team in place, PetroTal is positioned to add value for many years to come."

Sath Kanagarajah, Chief Executive Officer of Remus Corporation commented:

"We are delighted to achieve this significant strategic milestone for Remus and our investors. Our deeply experienced management team looks forward to working with PetroTal and the Peruvian national authorities to support further development of PetroTal, in full cooperation with all their stakeholders. We are especially keen to foster local employment opportunities and partnerships with the communities in which PetroTal operates."

About Remus

Remus is a privately owned and managed investor in energy assets and companies, with a long-term investment horizon and a dedication to unlocking the full potential of energy opportunities. Remus actively seeks economic and social value creation for all stakeholders, including local employees, their families and communities. Its management and advisors bring many decades of investment and operational expertise to project scouting, development and management.

Remus is incorporated under Guernsey law, and is managed by Remus Horizons Management Company Limited, a licensee of The Guernsey Financial Services Commission. For further information about Remus, please visit https://remus-petroleum.com.

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 Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, and in early 2020 became the second largest crude oil producer in Peru. 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

Manuel Pablo Zuniga-Pflucker
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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright / Rupert Holdsworth Hunt / Harry Baker
T: +44 (0) 7711 627449

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, the completion of the Transaction. 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.

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/70162


PetroTal Announces Third Quarter 2020 Financial and Operating Results

Following social unrest, production has been restricted to 5,000 bopd to manage oil inventory

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - November 19, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") is pleased to announce its financial and operating results for the three and nine months ended September 30, 2020 ("Q3 2020").

Selected financial and operational information is outlined below and should be read in conjunction with the Company's unaudited consolidated financial statements ("Financial Statements") and management's discussion and analysis ("MD&A") for Q3 2020, which are available on SEDAR at www.sedar.com and the Company's website at www.PetroTal‐Corp.com. All amounts herein are in United States dollars ("US$") unless otherwise stated.

Q3 2020 HIGHLIGHTS

RESULTS AT A GLANCE

   Nine Months Ended    Three Months Ended
September 30   September 30
2020
June 30
2020
March 31
2020
 2020 2019  
Financial  
Crude oil revenues $59,218 $32,307   $7,611 $9,839 $41,768
Royalties (2,177) (1,581)   (248) (123) (1,806)
Net operating income 22,889 13,364   2,324 2,756 17,809
Commodity price derivatives income (loss) (1) (17,757) 580   4,399 18,264 (40,420)
Net income (loss) (12,199) 1,925   3,224 16,029 (31,452)
Basic and diluted net income (loss) (US$/share) (0.02) 0.00   0.00 0.02 (0.05)
Capital expenditures 35,982 62,490   3,354 8,756 23,872
Operating  
Average production (bopd) (2)(3) 5,428 2,905   2,444 4,185 9,686
Average sales (bopd) 5,777 2,188   2,327 4,729 10,313
Average Brent oil price (US$/barrel) 42.69 64.67   44.32 29.19 50.14
Average realized price (US$/barrel) 37.41 54.09   35.56 22.87 44.51
Netback (US$/barrel) 14.46 22.38   10.86 6.40 18.98
Funds flow provided by (used in) operations 15,375 8,198   (548) 862 15,061
Balance sheet  
Cash   9,788 20,379 7,373
Working Capital   (30,407) (31,845) (61,025)
Total assets   205,531 216,899 194,274
Current liabilities   62,355 76,932 89,914
Equity   126,253 122,789 90,029

 

(1) Contingent liability will be paid over a three-year period.
(2) The field was shut in on May 7, 2020; for the 37 producing days in Q2 2020, production averaged 11,500 bopd.
(3) The field was shut in from July 1 to July 14 and from August 9 to September 27; for the 28 producing days in Q3 2020 constrained production averaged 8,000 bopd.

Q3 2020 Operational Highlights

  • On July 15, 2020, PetroTal recommenced oil field operations after the COVID-19 government-imposed shut down on May 7, 2020, and production returned to 11,500 bopd shortly thereafter;
  • As a preemptive measure, the Bretana oil field was shut down on August 9, 2020 due to social unrest against the government outside the field camp that resulted in a violent confrontation between protestors (intending to occupy the Bretana facilities) and the police. The social unrest was conducted by protestors seeking government assistance against the COVID-19 crisis; and,
  • As a result of the indigenous communities and government bodies reaching an agreement that will see increased funding for the local communities, on September 28, 2020, PetroTal recommenced oil field operations, and production again was restored to the pre-shut down level of 11,500 bopd.

Q3 2020 Financial Highlights

  • Revenue decreased to $7.6 million ($35.56/bbl) compared to $9.8 million ($22.87/bbl) in Q2 2020, due to lower oil production as a result of social unrest in Q3 2020. However, this was in part, offset by higher oil prices, with the average Brent oil price increasing to $44.32/bbl from $29.19/bbl for Q2 2020;
  • Royalties to the Peruvian government were $0.2 million (3.2% of revenue) compared to $0.1 million (1.3% of revenue) for Q2 2020;
  • Operating costs were $2.5 million ($11.64/bbl) compared to $2.4 million ($5.67/bbl) for Q2 2020, reflecting consistent quarterly costs not directly impacted by lower production;
  • Transportation costs were $2.5 million ($11.90/bbl) compared to $4.5 million ($10.50/bbl) for Q2 2020, reflecting the variable cost nature associated with lower production;
  • Cash flow used by operations was $0.5 million compared to $0.9 million generated by operations in Q2 2020;
  • Net operating income was $2.3 million ($10.86/bbl) compared to net operating income of $2.8 million ($6.40/bbl) in Q2 2020;
  • The Company had cash of $9.8 million at the end of Q3 2020 compared to $20.4 million at the end of Q2 2020. The majority of the cash reduction is attributed to a $9.4 million reduction in accounts payable during Q3 2020;
  • The Company's contingent derivative liability relating to oil sold to Petroperu was reduced to $17.0 million at September 30, 2020 from $22.3 million at June 30, 2020, as a result of higher oil prices in Q3 2020. This contingent liability relates to the timing difference between when Petroperu provides an initial payment for the oil and when the final settlement price is calculated. The amount of the ultimate liability will be crystallized when the oil is actually sold by Petroperu, which is expected to commence in December 2020 and continue into 2021; and,
  • The contingent liability pertaining to the Brent oil price reduction has been structured into a three-year payment arrangement ("Arrangement") with Petroperu (the "Parties"):
    • The amount of this contingent liability to Petroperu will be definitively determined when the security arrangements for PetroTal's obligations are finalized;
    • The Arrangement allows PetroTal to settle the obligations to Petroperu now while still allowing the Company to benefit from higher oil prices forecasted by the Brent forward strip pricing curve, when the physical oil sales occur;
    • The Parties have agreed to extend the one-year Oil Sales Contract to three years upon expiry of the current term in December 2020;
    • The Parties established a framework to ensure that future oil sales under the Oil Sales Contract have adequate hedge protection to avoid future downside losses; and,
    • The Parties have agreed to further amendments to the Oil Sales Contract for lower pipeline tariffs and fees during periods of low oil prices.

Events subsequent to September 30, 2020

  • After PetroTal recommenced oil field operations on September 28, 2020, the wells were quickly brought into full operation at the pre shut-down level of 11,500 bopd. The indigenous communities and government bodies have reached an agreement that will see increased funding for the local communities. Oil deliveries have commenced to the Iquitos refinery and, on a limited basis, to the Northern Oil Pipeline ("ONP") until social issues affecting the ONP are fully resolved. In order to manage oil inventory levels, production is currently intentionally constrained to 5,000 bopd, until such time as the ONP is operational. The Company's stringent COVID-19 protocols continue to ensure that the camp remains safe;
  • In October 2020, the Company sold 192,000 barrels of oil to the Iquitos refinery and the ONP at pump station #1, thereby generating revenues of $5.5 million (net of transportation and fees), which has been paid to the Company;
  • Discussions with Petroperu are continuing with respect to finalizing the contingent liability Arrangement, and the agreement is expected to be completed in the coming weeks;
  • The Company continues to diligently pursue a robust credit facility that will enhance liquidity and enable the Company to continue investment in the Bretana oil field for development growth; and,
  • PetroTal has been assessing other oil export options and has signed a contract with an international oil trader for a pilot shipment to export 120,000 barrels into the Atlantic region using the Amazon river through Brazil. The shipment will be sold FOB Bretana, priced at the forward month Brent ICE price, and paid within two weeks of loading at Bretana. There are no subsequent oil price adjustments.

Liquidity Update

At November 19, 2020, PetroTal has cash resources of $9.8 million, with accounts payable and accrued liabilities of approximately $39.3 million, a reduction of $1 million from September 30, 2020. Ongoing payments will be managed from expected oil field revenues and internal cash resources. Pursuant to contractual terms with our suppliers, approximately 46% of the amount are not due until into 2021.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:

"Whilst the last few months have been challenging, from both a COVID-19 and a social unrest perspective, we believe we have now turned the corner. Although we continue to restrict current production to 5,000 bopd, in order to manage our inventory levels, we are confident that we can increase production back to 11,500 bopd once the ONP reopens.

"We are pleased that the indigenous communities and government bodies have reached an agreement that will see increased funding for the local communities, and we look forward to continuing our strong working relationship with national, regional & local governments and the communities nearby Bretana as well as their indigenous leaders.

"We are pleased to sign an agreement with an international oil trader for the pilot export sale of 120,000 barrels of oil into the Atlantic region, diversifying our oil export options. We also aim to secure a credit facility in due course, which has the potential to enhance the Company's liquidity, so we can continue investment in the Bretana oil field for development growth. In closing, I would like to thank all our stakeholders for their continued support, during what has been a challenging period for the Company. We remain upbeat about the potential of the Bretana field and are firmly focused on delivering value for all those involved in the Company."

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 its 100% working interest in Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, and in early 2020 became the second largest crude oil producer in Peru. 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

Manuel Pablo Zuniga-Pflucker
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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright / Rupert Holdsworth Hunt / Harry Baker
T: +44 (0) 7711 627449

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; increased oil production volumes due to the reopening of the Bretana oil field, intentional production constraints to manage oil inventory and plans to return to full of production at such time as ONP is operational; the Arrangement with Petroperu, including the intention to enter into a final agreement in respect of contingent liabilities; the Company's ability to secure a credit facility; export alternatives; future development and growth prospects; and the ongoing effects of Covid-19 and social unrest and violence in Peru on the Company and its employees. 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, inventory and barge storage capacity, 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 (including recent social unrest and violence), 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 continue to 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, 2019 and management's discussion and analysis for the three and nine months ended September 30, 2020 which are available on SEDAR at www.sedar.com. The forward‐looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward‐looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

FOFI DISCLOSURE: This press release contains future‐oriented financial information and financial outlook information (collectively, "FOFI") about PetroTal's prospective results of operations, production, revenue, cash resources, liquidity, a future credit facility 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.

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To view the source version of this press release, please visit https://www.newsfilecorp.com/release/68620


PetroTal Issues Equity Vested Through PSU Plan

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - October 9, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") announces that the Company has issued an aggregate of 1,611,678 Common Shares to employees (not designated as officers or directors ("Insiders") or persons discharging managerial responsibilities ("PDMR's") pursuant to the obligation to annually issue vested performance share units ("PSUs") to acquire Common Shares under the Company's performance and restricted share unit plan, as approved by the TSX Venture Exchange on December 12, 2019.

Further details regarding the PSU plan are set out in the management information circular of the Company dated July 9, 2020 which is available on SEDAR at www.sedar.com.

Admission to Trading on AIM/TSXV and Total Voting Rights

Application will be made to the London Stock Exchange for the admission of 1,611,678 Common Shares to trading on AIM ("Admission") and to the TSXV for listing of 1,611,678 Common Shares for trading on the facilities of the TSXV. It is expected that Admission will become effective at 8.00 a.m. on October 16, 2020.

Following Admission, the Company will have 816,167,379 Common Shares issued and there are no shares held in treasury. For purposes of the Disclosure Guidance and Transparency Rules, the total number of voting rights in the Company is calculated as the number of outstanding Common Shares, less the Common Shares not able to be voted due to restrictions applicable to certain holders which results in a total voting rights figure of 814,917,593 Common Shares. This figure may be used by shareholders as the denominator for the calculations by which they determine if they are required to notify their interest in, or a change of their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.

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 its 100% working interest in Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, and in early 2020 became the second largest crude oil producer in Peru with more than 10,000 bopd of production. 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 oilfield.

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

Manuel Pablo Zuniga-Pflucker
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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright / Rupert Holdsworth Hunt / Harry Baker
T: +44 (0) 7711 627449

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; increased oil production volumes due to the reopening of the Bretana oil field and resumption of oil production therefrom; the effects and duration of the Funding Agreement; PetroTal's plans regarding community support, the environmental and corporate governance; and the ongoing effects of Covid-19 on the Company and its employees. 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 reopening of existing infrastructure, its ability to deliver production and the anticipated capital expenditures associated therewith; successful implementation of the Decree; prevailing commodity prices and actual prices received for PetroTal's products; the availability and performance of drilling rigs, facilities, pipelines, inventory and barge storage capacity, other oilfield services and skilled labour; royalty regimes; exchange rates; the application of regulatory and licensing requirements; current legislation; the success of future drilling and development activities; and general economic conditions. 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. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2019 and management's discussion and analysis for the three and six months ended June 30, 2020 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/65554


PetroTal Recommences Oil Production at the Bretana Field

The Peruvian government and communities agree to funding plan

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - September 30, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") is pleased to announce the recommencement of oil production and operations at the Bretana oil field. The recommencement of oil production follows agreements between the indigenous communities in the northeastern region of Peru (inclusive of Loreto, where Bretana is located), Regional governments and the Central Government of Peru, that will see enhanced funding available for these regions to aid community projects.

Highlights

  • PetroTal recommenced operations at the Bretana oil field on September 28, 2020, and as all seven wells continue to be gradually brought into full operation, current production is approximately 11,000 barrels of oil per day ("bopd"), approaching the pre shut down level of 11,500 bopd;
  • The indigenous communities and government bodies have reached an agreement that will see increased funding for the local communities;
  • Oil deliveries will commence to the Iquitos refinery immediately, and the Northern Oil Pipeline ("ONP") at the Saramuro Pump Station will be ready to receive deliveries of Bretana oil when the barges arrive; and,
  • The Company's stringent Covid-19 protocols continue to ensure that the camp remains safe and operates with minimal downtime.

Resolution between Communities and Governments

The Central Government has made three important announcements tackling the social unrest, which was exacerbated by the Covid-19 crisis. These measures will provide a long-term solution to these issues.

The first was Supreme Decree Nº 145-2020-PCM1 signed by the President (published August 28, 2020) establishing an investment plan to bridge the income gap among the poor indigenous communities, known in Spanish as the Plan de Cierres de Brechas ("PCB"). PetroTal strongly supports this initiative, which provides a six-year financial commitment of approximately US $1.7 billion2 to support development of the communities, of which US $28 million will be designated for economic development of the local communities over the next four months.

The second announcement was Ministerial Resolution Nº 268-2020-PCM3 signed by the Prime Minister (published September 20, 2020) establishing a working group called "The Management Committee for monitoring interventions and outcomes for the development of the native communities and localities of the provinces under the sphere of hydrocarbon activities in the provinces of Maynas, Loreto, Datem del Maranon, Requena and Alto Amazonas, of the department of Loreto", that will decide the projects under the PCB and who would manage them.

The third announcement was a Decree of Urgency Nº 114-20204 signed by the President (published September 23, 2020) allocating approximately US $250 million5 to a list of infrastructure projects throughout the country, with US $20 million5 allocated to the Loreto Region where Bretana is located. This decree expedites the procurement process to ensure all the allocated funds are properly deployed to maximize employment throughout all the communities.

1) https://cdn.www.gob.pe/uploads/document/file/1268888/DS%20N%C2%B0%20145-2020-PCM.pdf
2) Related news article found at https://andina.pe/agencia/noticia-gobierno-destinara-6-mil-millones-soles-para-cerrar-brechas-la-amazonia-811705.aspx
3) https://cdn.www.gob.pe/uploads/document/file/1308319/RM%20N%C2%B0268-2020-PCM.pdf
4) https://cdn.www.gob.pe/uploads/document/file/1317730/DECRETO%20DE%20URGENCIA%20N°%20114-2020.pdf
5) https://cdn.www.gob.pe/uploads/document/file/1317749/ANEXOS%20DU%20N%C2%B0114-2020.pdf

PetroTal acknowledges the efforts made by the indigenous communities and all levels of the Peruvian government to resolve the recent social disruption and to ensure a long-term solution is in place to minimize future disruptions. Going forward, PetroTal will continue its dedication to community support, along with focusing on sound environmental and corporate governance policies as well as maintaining stringent Covid-19 protocols to ensure that the camp remains safe and is operated with minimal downtime.

Bretana Oil Field Recommencement

With the full support from the local indigenous communities and governments, PetroTal has recommenced operations at the Bretana oil field. All seven wells have now commenced operation and are being gradually optimized for effective reservoir management. Production is currently at approximately 11,000 bopd, and expected to reach the pre shut down level of 11,500 bopd, shortly.

While production was shut in at Bretana, Petroperu used that time to carry out some maintenance work on the pipeline, which is expected to be completed on time without affecting Bretana's oil deliveries. Similarly, with the social unrest at Bretana that originated at the pipeline now resolved, the Government expects to have the pipeline social issues also resolved in time for the pipeline to receive Bretana's oil production. In the meantime, the Iquitos refinery operated continuously throughout the recent social unrest, thereby allowing PetroTal to deliver oil from inventory over the last month.

Liquidity Update

At September 29, 2020, PetroTal had cash resources of US $12 million, with accounts payable and accrued liabilities of approximately US $36 million, a reduction of US $14 million from the end of Q2 2020. Ongoing payments will be managed from expected oil field revenues and internal cash resources. Pursuant to contractual terms with our suppliers, approximately 30% of the amount is not due until into 2021.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:

"PetroTal commends the efforts of all parties in reaching a negotiated settlement that will ultimately benefit the indigenous communities, the Peruvian government, and all operating companies, including PetroTal. On behalf of PetroTal, I would like to sincerely thank the PetroTal team for their continued dedication during this period and for their contribution towards this long-term community funding solution. Our corporate commitment is to ensure all stakeholders benefit from the Bretana project, including the local communities that support our Company."

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 its 100% working interest in Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, and in early 2020 became the second largest crude oil producer in Peru with more than 10,000 bopd of production. 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

Manuel Pablo Zuniga-Pflucker
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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright / Rupert Holdsworth Hunt / Harry Baker
T: +44 (0) 7711 627449

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; increased oil production volumes due to the reopening of the Bretana oil field and resumption of oil production therefrom; the effects and duration of the Funding Agreement; PetroTal's plans regarding community support, the environmental and corporate governance; and the ongoing effects of Covid-19 on the Company and its employees. 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 reopening of existing infrastructure, its ability to deliver production and the anticipated capital expenditures associated therewith; successful implementation of the Decree; prevailing commodity prices and actual prices received for PetroTal's products; the availability and performance of drilling rigs, facilities, pipelines, inventory and barge storage capacity, other oilfield services and skilled labour; royalty regimes; exchange rates; the application of regulatory and licensing requirements; current legislation; the success of future drilling and development activities; and general economic conditions. 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. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2019 and management's discussion and analysis for the three and six months ended June 30, 2020 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.

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To view the source version of this press release, please visit https://www.newsfilecorp.com/release/64920


PetroTal Announces Voting Results of Shareholders' Meeting

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - September 10, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") announces that all resolutions were duly passed by Shareholders at the Company's Annual General and Special Meeting held on September 9, 2020.

Resolution 9 related to authorizing the Board of Directors, at its discretion, to proceed with a potential consolidation of the Common Shares on the basis of a ratio of between four and eight pre-consolidation Common Shares for each one post-consolidation Common Share (the "Consolidation"). The Consolidation is subject to approval of the TSX Venture Exchange (the "TSXV"), which if received and the Board of Directors determines to proceed, the Consolidation will occur at a time determined by the Board and announced by a press release of the Company. The Company believes that the Consolidation, if implemented, will promote increased liquidity and reduced volatility in the trading of the Shares.

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 Bretana oil field in Peru's Block 95 where oil production was initiated in June 2018, and in early 2020 became the second largest crude oil producer in Peru with more than 10,000 bopd of production. 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

Manuel Pablo Zuniga-Pflucker
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

Auctus Advisors LLP (Joint Broker)
Jonathan Wright / Rupert Holdsworth Hunt / Harry Baker
T: +44 (0) 7711 627449

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 reopening of the Bretana oil field and resumption of oil production therefrom; the effect and implementation of the Decree; and the ongoing effects of COVID-19 on the Company and its employees. 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 reopening of existing infrastructure, its ability to deliver production and the anticipated capital expenditures associated therewith; successful implementation of the Decree; prevailing commodity prices and actual prices received for PetroTal's products; the availability and performance of drilling rigs, facilities, pipelines, inventory and barge storage capacity, other oilfield services and skilled labour; royalty regimes; exchange rates; the application of regulatory and licensing requirements; current legislation; the success of future drilling and development activities; and general economic conditions. 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. Please refer to the risk factors identified in the Company's annual information form for the year ended December 31, 2019 and management's discussion and analysis for the three and six months ended June 30, 2020 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/63521