PetroTal Announces Exercise of Performance Warrants and Total Voting Rights

Calgary, AB and Houston, TX – November 28, 2022 - PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL, AIM: PTAL and OTCQX: PTALF) announces that it received a notice to exercise 230,000 and 88,580 (net basis) Performance Warrants at a price of US$0.1869 per Common Share.

Following this warrant exercise, the Company will have 599,690 Performance Warrants outstanding.  Application will be made for admission of the 318,580 common shares, which will rank pari passu with existing Common Shares, to trading on AIM ("Admission"), which is expected to occur on or around November 30, 2022.

Following Admission, the Company will have 859,642,573 common shares issued and there are no shares held in treasury. This figure may be used by shareholders as the denominator for the calculations to 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, tri‐quoted (TSXV: TAL, AIM: PTAL and OTCQX: 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)
Ritchie Balmer / James Spinney / Robert Collins
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; and the impact of social disruption on the Company's operations, including a potential field shutdown at Bretana. 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. 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 three and nine months ended September 30, 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.

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

 


PetroTal Announces Q3 2022 Financial and Operating Results

Strong balance sheet position

$150 million of free cash flow delivered in nine months of 2022

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - November 17, 2022) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) (OTCQX: PTALF) ("PetroTal" or the "Company") is pleased to announce its financial and operating results for the three and nine months ended September 30, 2022 ("Q3 2022").

Selected financial and operational information is outlined below and should be read in conjunction with the Company's unaudited consolidated financial statements ("Financial Statements"), and management's discussion and analysis ("MD&A") for the three and nine months ended September 30, 2022, 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.

Q3 2022 Highlights

  • Production in the quarter averaged 12,229 barrels of oil per day ("bopd") with sales of 12,186 bopd (1.1 million barrels), despite being constrained as low river levels reduced barge capacity;
  • Generated net operating income(1) ("NOI") of approximately $62.3 million, EBITDA(1) of $57.6 million, and free cash flow(1) before all debt service of $37.0 million equating to a 44% free cash flow margin(2);
  • Capital investment totaled $20.6 million, primarily to drill well 13H and key infrastructure projects;
  • Petroperu exported approximately 720,000 barrels of oil to an international refiner, crystalizing for PetroTal over $64 million (including VAT) of true up revenue and reducing the amount of PetroTal's oil in the Northern Peruvian Pipeline ("ONP") to 2.4 million barrels;
  • Demonstrated continued balance sheet strength with cash of $93 million at September 30, 2022, a net surplus(2) balance of $75.5 million. The Company remains in full compliance with all bond covenants as at September 30, 2022; and,
  • On September 15, 2022, PetroTal welcomed two new Directors, Messrs. Luis Carranza and Jon Harris, and announced the retirement of Messrs. Gary Guidry and Ryan Ellson.

(1) Free cash flow defined as EBITDA less capital expenditures. Free cash flow margin defined as free cash flow divided by crude oil revenues. See "Selected Financial Measures"
(2) Net debt / surplus defined as (total cash + total trade and VAT receivables + total derivative assets) - (trade and VAT payables + total bond debt + total derivative obligations + total lease obligations)

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

"Having produced over 10.5 million barrels of oil since inception, we are on track to deliver average production growth of approximately 40% and almost $200 million in free cash flow in 2022. Although the Company encountered external transportation challenges, we expect to deliver double digit yearly production growth with potentially 40% plus free cash flow yields under current Brent oil forward strip pricing conditions. The high margin nature of our business should be at the forefront of investors' sentiment, alongside our proven ability to execute technically."

Selected Financial and Operational Highlights

  Three Months Ended Nine Months Ended
(in thousands USD) Sept 30, 2022 Sept 30, 2021 Sept 30, 2022 Sept 30, 2021
Financial
Crude oil revenues 84,164 44,781 295,350 119,946
Royalties (3) (11,689) (2,604) (26,166) (6,658)
Net operating income (1) 62,333 29,587 225,114 79,234
Commodity price derivative (gain)/loss 32,686 (293) 5,139 (18,658)
Net income 2,594 14,970 151,351 57,129
Diluted net income (US$/share) 0.00 0.02 0.18 0.07
Capital expenditures 20,625 26,114 62,178 55,590
Operating
Average production (bopd) 12,229 9,508 12,816 8,567
Average sales (bopd) 12,186 9,142 14,095 8,856
Average Brent price ($/bbl) 97.89 73.21 102.39 67.76
Contracted sales price, gross ($/bbl) 97.21 71.06 98.78 65.67
Netback ($/bbl)(2) 55.60 35.18 58.50 32.77
Funds flow provided by operations 46,205 18,648 112,636 42,742
Balance sheet
Cash and restricted cash 93,018 57,655
Working capital 136,338 56,455
Total assets 549,838 373,261
Current liabilities 110,160 69,785
Equity 361,367 195,572
1. Net operating income ("NOI") and Netback represent revenues less royalties, operating expenses, and direct transportation.
2. Netback per barrel ("bbl") and funds flow provided by operations do not have standardized meaning prescribed by GAAP and therefore may not be comparable with the calculation of similar measures for other entities. See "Selected Financial Measures" section.
3. Royalties in Q3 2022 include the value since January 1, 2022 inception for the 2.5% social trust initiative.

 

Q3 2022 Financial Highlights

Strong revenue profile. Oil revenue in Q3 2022 was $84.2 million ($75.07/bbl) compared to Q2 2022 of $118.4 million ($89.04/bbl) and Q3 2021 of $44.8 million ($53.24/bbl).

High margin operational cash flow. Generated NOI and EBITDA of $62.3 million ($55.60/bbl) and $57.6 million ($51.42/bbl), respectively, compared to $98.6 million ($74.12/bbl) and $93.4 million ($70.26/bbl), respectively, in Q2 2022 and $29.6 million ($35.18/bbl) and $26.1 million ($31.07/bbl), respectively, in Q3 2021.

Efficient capital deployment. Capital expenditures in the quarter totalled $20.6 million and were focused on drilling and completing well 13H. During the nine months ended September 30, 2022, the Company invested a total of $62.2 million, demonstrating capital flexibility under sales constraint conditions.

Robust free cash flow. Generated free cash flow before changes in non-cash working capital and debt service of $37.0 million ($33.03/bbl) in the quarter. Total free cash flow before changes in non-cash working capital and debt service for the nine months ended September 30, 2022 is nearly $150 million significantly strengthening the Company's net surplus position by nearly $130 million.

Total operating costs under $10/bbl. The Company had lower gross total operating cost expense in the quarter of $10.1 million ($9.06/bbl) from $11.7 million ($8.82/bbl) in Q2 2022. Total quarterly lifting costs were $7.4 million ($6.62/bbl), a decrease from Q2 2022 of $8.4 million ($6.28/bbl) and an increase from Q3 2021 of $5.4 million ($6.47/bbl). Total transportation costs were $2.7 million ($2.44/bbl) a slight decrease from $3.4 million ($2.54/bbl) in Q2 2022 and a substantial decrease from $7.1 million ($8.50/bbl) in Q3 2021.

G&A on budget. Q3 2022 G&A was $4.7 million ($4.18/bbl) compared to $5.1 million ($3.87/bbl) in Q2 2022 and $3.4 million ($4.11/bbl) in Q3 2021.

Net income/loss. PetroTal posted net income of $2.6 million, a decrease from Q2 2022 net income of approximately $84 million, primarily from lower sales in the quarter, a non cash commodity price derivative loss of approximately $33 million, and royalty provision for the social trust.

Balance sheet in a cash surplus position. Net surplus was approximately $75.5 million as at September 30, 2022, consistent with the prior quarter and up substantially from Q3 2021, as defined internally by the Company.

Net derivative asset balance. The total net derivative asset on the balance sheet as at September 30, 2022 was $3.5 million, a decrease of $53.3 million from Q2 2022, as a result of reclassified true up revenue of $64 million realized in July 2022, along with other mark to market changes in the value of oil in the ONP. As at September 30, 2022 approximately 2.4 million barrels remained in the ONP.
 

Operational and Financial Highlights Subsequent to September 30, 2022

Excellent well 13H results. Well 13H successfully tested at over 8,000 bopd during its first week of production and has averaged approximately 6,200 bopd month to date ending November 14, 2022, which was slightly constrained during this period. At its current trend and assuming a $55/bbl netback, the well is on track to payout within 60 days. In addition, the technical team encountered the producing formation five meters higher near the end of the horizontal section of the well possibly increasing future oil in place and reserve estimates.

Commenced drilling well 12H. On October 16, 2022, the Company commenced drilling well 12H with a budgeted cost of $14 million and estimated completion in mid December 2022.

Slowly rising river levels in November. During the month of October, river levels in Brazil continued to be at record low levels, in some cases, exposing sand bars above the water level. This significantly impacted the Company's ability to sell oil in the month of October limiting production to approximately 6,500 bopd. The Company expects to sell nearly 900 thousand barrels over November and December as river levels return to normal.

On November 10 and 11th, 2022 the Company was able to produce over 20,000 bopd.

2021 ESG report being finalized. Over the coming weeks PetroTal will release its second annual Sustainability Report covering the 2021 year. The Company is now calibrated to Sustainability Accounting Standards ("SASB"), Global Reporting Initiatives ("GRI"), and Sustainable Development Goal standards and is committed to being a sustainable energy leader in Peru. In 2021, the Company had zero hydrocarbon spills, delivered a scope 1 emissions intensity metric of 11.4 kg/bbl, and invested millions in various ESG projects as outlined in the report, showcasing the modest operational footprint that the Company has managed in the Loreto region.

Petroperu update. The Company continues to work with Petroperu's management team to assess and negotiate payment of approximately $90 million of receivable value. On October 10, 2022 the government of Peru agreed to make a capital contribution to Petroperu of $1 billion in order to strengthen its financial capacity for continued operations, and provide $500 million of credit facility support. The priority of allocation is immediate fuel and energy needs in Peru, and the Company expects that the $64 million outstanding amount owed to the Company will be paid on a negotiated payment schedule.
 

Guidance Update

The Company is adjusting Q4 2022, and therefore 2022 guidance based on October 2022 and early November river conditions into Brazil. Final 2022 guidance is now between 12,000 and 13,000 bopd for Q4 2022 and 2022 full year.

Adjusted Guidance Q1 (actual) Q2 (actual) Q3 (actual) Q4 2022
Oil wells completed 1 (10H) 1 (11H) 0 2 4
Average Production (bopd) 11,746 14,467 12,229 12,000 - 13,000 12,000-13,000
CAPEX (millions) $18 $24 $21 $37 $100

 

USD millions, unless stated otherwise Guidance
Realized Brent (USD/bbl) ~$80
Average Production (bopd) 12,000 - 13,000
Net operating income $292
G&A ($21)
Net derivative settlements $27
Adjusted EBITDA $298
CAPEX ($100)
Free cash flow $198

 

PetroTal Rebranding

PetroTal is excited to announce a corporate rebranding which includes a new vision, color scheme and logo design. Over the coming weeks we will be rolling out a new website with many new and exciting features for investors and or interested stakeholders. Further updates on this will be made when available.

Updated Corporate Presentation and investor webcast

Please see the Company's newly designed investor presentation now posted at www.petrotal-corp.com.

Webcast link for November 17, 2022 at 8am MDT

https://stream.brrmedia.co.uk/broadcast/63590b2298f6352ab0eba9cc

 
ABOUT PETROTAL

PetroTal is a publicly traded, tri quoted (TSXV: TAL) (AIM: PTAL) and (OTCQX: 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 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)
Ritchie Balmer / James Spinney / Robert Collins
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

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.

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.

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; PetroTal's revised 2022 guidance and budget including, but not limited to, estimated or anticipated production levels, capital expenditures and drilling plans; the intention to redeem the outstanding bonds and become debt free; a future robust capital return program; PetroTal's plans to deliver strong operational performance and to generate free cash flow and growth; capital requirements and the Company's ability to access capital on desirable terms and within required timelines; 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 and operate at unrestricted levels; anticipated future production and revenue; drilling plans including the timing of drilling, commissioning, and startup and the impact of delays thereon; revised 2022 guidance; oil production levels and production growth, including average and exit production in 2022; future oil sales and sales expansion through alternative exports routes, including barging and trucking; the Company's proposals for collaboration with local communities; future river water levels and their impacts on transportation systems; and future development and growth prospects. 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, impact of inflation on costs, 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, future river water levels, 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, wars (including Russia's war in Ukraine), 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. The ongoing war between Russia and Ukraine has the potential to threaten the supply of oil and gas from the region. The long-term impacts of the war between these nations remains uncertain. 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, increased operating and capital costs due to inflationary pressures, business, financial conditions, results of operations and other factors relevant to the Company. Please refer to the risk factors identified in the Corporation's annual information form (filed April 28, 2022) and MD&A (filed November 17, 2022) (the "MD&A"), which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

SHORT-TERM PRODUCTION RATES: References in this press release to the initial week of production of well 13H and other short term production rates are useful in confirming the presence of hydrocarbons, however such rates are not determinative of the rate 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.

SPECIFIED FINANCIAL MEASURES: This press release includes various specified financial measures, including non-GAAP financial measures, non-GAAP financial ratios and capital management measures as further described herein. These measures do not have a standardized meaning prescribed by generally accepted accounting principles ("GAAP") and, therefore, may not be comparable with the calculation of similar measures 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" (non-GAAP financial ratio) equals total petroleum sales less quality discount, lifting costs, transportation costs and royalty payments calculated on a bbl basis. The Company considers netbacks to be a key measure as they demonstrate Company's profitability relative to current commodity prices. "Funds flow provided by operations" (non-GAAP financial measure) includes all cash generated from operating activities and is calculated before changes in non-cash working capital. "Adjusted EBITDA" (non-GAAP financial measure) is calculated as consolidated net income (loss) before interest and financing expenses, income taxes, depletion, depreciation and amortization and adjusted for G&A impacts and certain non-cash, extraordinary and non-recurring items primarily relating to unrealized gains and losses on financial instruments and impairment losses, including derivative true-up settlements. PetroTal utilizes adjusted EBITDA as a measure of operational performance and cash flow generating capability. Adjusted EBITDA impacts the level and extent of funding for capital projects investments. Reference to EBITDA is calculated as net operating income less G&A. "Free cash flow" (non-GAAP financial measure) is calculated as net operating income less G&A less exploration and development capital expenditures and is calculated prior to all debt service, taxes, lease payments, hedge costs, factoring, and lease payments. Management uses free cash flow to determine the amount of funds available to the Company for future capital allocation decisions. Please refer to the MD&A for additional information relating to specified financial measures.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about PetroTal's revised budget and guidance, prospective results of operations, production and production capacity, free cash flow, revenue, adjusted EBITDA, debt repayment, liquidity, shareholder returns 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.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/144556


PetroTal Announces Robust Initial Production For Well 13H

Average production over 8,000 bopd during first week

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - November 3, 2022) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) (OTCQX: PTALF) ("PetroTal" or the "Company") is pleased to announce the successful testing results of well 13H, the Company's thirteenth producing well.

Well 13H highlights

  • Well 13H has successfully tested at approximately 8,000 barrels of oil per day ("bopd") over its first week of production, placing it in the top horizonal producers drilled by the Company, with the November 2, 2022 rate at 7,825 bopd;
  • To optimize operations, well 13H was drilled ahead of well 12H to save time and cost related to skidding the rig to the corresponding cellar;
  • The well was drilled to a total measured depth of 4,864 meters, including a 1,152 meter lateral section making it the longest reach horizontal well the Company has drilled;
  • The total cost of the well was $14.4 million, within budget and completed on time without any operational issues;
  • Well 13H was successfully completed on October 13, 2022, however, it could not be fully tested until October 27, 2022 when internal storage capacity became available. Barging logistics continue to improve with the Company now expecting to raise production levels by mid-November;
  • Current field production capacity is over 20,000 bopd; and,
  • Well 13H encountered the target producing formation approximately three meters higher than prognosis and approximately five meters higher at the end of the horizontal section which could have a positive impact on the oil-in-place estimates and reserves.

Well 12H

PetroTal continues its active drilling program to further increase its low cost, high margin production at Bretana. On October 16, 2022, the Company commenced drilling well 12H with an approximate cost of $14.0 million and an estimated completion in mid-December 2022.

Q3 2022 Financial and Operating Results

The Company will release its Q3 2022 financial and operating results on November 17, 2022 and will host a live webcast at 9am CDT time. Please see the webcast link below:

https://stream.brrmedia.co.uk/broadcast/63590b2298f6352ab0eba9cc

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

"We are pleased to announce the successful and productive 13H oil well, our longest horizontal well to date. We look forward to seeing the 12H well deliver similar results. We will continue to operate and develop our assets with prudent and safe operational practices that deliver best in class productivity for employees and shareholders."

ABOUT PETROTAL

PetroTal is a publicly traded, tri quoted (TSXV: TAL) (AIM: PTAL) (OTCQX: 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 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)
Ritchie Balmer / James Spinney / Robert Collins
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

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

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; PetroTal's revised 2022 guidance and budget including, but not limited to, estimated or anticipated production levels, capital expenditures and drilling plans; the intention to redeem the outstanding bonds; PetroTal plans to deliver strong operational performance and to generate free cash flow and growth; capital requirements and the Company's ability to access capital on desirable terms and within required timelines; 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 and operate at unrestricted levels; anticipated future production and revenue; drilling plans including the timing of drilling, commissioning, and startup and the impact of delays thereon; oil production levels, including average and exit production in 2022; sales expansion through alternative exports routes, including barging and trucking; the Company's proposals for collaboration with local communities; and future development and growth prospects. 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, impact of inflation on costs, 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, wars (including Russia's war in Ukraine), 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. The ongoing war between Russia and Ukraine has the potential to threaten the supply of oil and gas from the region. The long-term impacts of the war between these nations remains uncertain. 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, increased operating and capital costs due to inflationary pressures, business, financial conditions, results of operations and other factors relevant to the Company. Please refer to the risk factors identified in the Corporation's annual information form (filed April 28, 2022) and MD&A (filed August 25, 2022) (the "MD&A"), which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

SPECIFIED FINANCIAL MEASURES: This press release includes various specified financial measures, including non-GAAP financial measures, non-GAAP financial ratios and capital management measures as further described herein. These measures do not have a standardized meaning prescribed by generally accepted accounting principles ("GAAP") and, therefore, may not be comparable with the calculation of similar measures 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. "Adjusted EBITDA" (non-GAAP financial measure) is calculated as consolidated net income (loss) before interest and financing expenses, income taxes, depletion, depreciation and amortization and adjusted for G&A impacts and certain non-cash, extraordinary and non-recurring items primarily relating to unrealized gains and losses on financial instruments and impairment losses, including derivative true-up settlements. PetroTal utilizes adjusted EBITDA as a measure of operational performance and cash flow generating capability. Adjusted EBITDA impacts the level and extent of funding for capital projects investments. Reference to EBITDA is calculated as net operating income less G&A. "Free cash flow" (non-GAAP financial measure) is calculated as net operating income less G&A less exploration and development capital expenditures and is calculated prior to all debt service, taxes, lease payments, hedge costs, factoring, and lease payments. Management uses free cash flow to determine the amount of funds available to the Company for future capital allocation decisions. Please refer to the MD&A for additional information relating to specified financial measures.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about PetroTal's revised budget and guidance, prospective results of operations, production and production capacity, free cash flow, revenue, adjusted EBITDA, debt repayment, liquidity, shareholder returns 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.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/142907


PetroTal Announces Q3 2022 Operations and Liquidity Update

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - October 13, 2022) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) (OTCQX: PTALF) ("PetroTal" or the "Company") is pleased to announce the following operational and corporate updates.

Q3 2022 Production

PetroTal's Q3 oil production was approximately 1.12 million barrels, representing 12,229 barrels of oil per day ("bopd"), which was the Company's second best producing quarter to date. The current technical production capacity of the Bretana oilfield is approximately 18,000 bopd, prior to the upcoming completion of well 13H. The third quarter is a seasonally dry quarter, but this year the river water levels were unusually low, so PetroTal took the precaution of loading barges to a reduced capacity to ensure their safe operation while traveling. As a result, production was constrained during this period to match reduced export capacity, which has been impacted from the continued closure of the Northern Peruvian Pipeline ("ONP"). As the dry period passes and water levels rise, the Company expects to return to increased levels of barge capacity.

Well 13H Update

On October 4, 2022, well 13H reached its total depth and is now being completed. At an unconstrained level, the Company expects to again have production capacity of over 20,000 bopd that can be quickly activated once river levels normalize, and additional barges are made available.

ONP and Barging Update

The ONP remains down as Petroperu continues to work through maintenance activities related to damage at various points on the pipeline. The Company is working with the new management of Petroperu to develop a view on when it may be able to resume exports through the ONP, but currently assumes this will not happen in 2022.

The Company is also working actively to expand the capacity of its export route to Brazil, both through expansions of the barge fleet and optimization of the round trip time with the eventual goal of reaching 1 million barrels of capacity. The Company expects to continue increasing its monthly Brazilian export capacity from the initial 120,000 barrels exported in December 2020 to an average of 600,000 barrels per month in 2023, without reliance on the ONP. In May and August 2022, the Company exported 470,000 and 450,000 barrels respectively, to Brazil, prior to being impacted by low river levels.

Liquidity Update

As at September 30, 2022 the Company had approximately $93 million in total cash with $18 million being restricted. At the end of Q3 2022, accounts payable were approximately $50.6 million, and estimated accounts receivable were $123.7 million. Subsequent to the quarter end, $12 million was received related to Brazilian export sales. The majority of remaining receivables are amounts owing from Petroperu related to June's sales export at Bayovar and for oil that entered the ONP in February 2022. The overdue amount owing from Petroperu, related to the July sales export is $64 million (including VAT). PetroTal has been working diligently with the finance group at Petroperu to establish a repayment schedule for the $64 million and to ensure the February invoice amount is a priority once their credit is reactivated.

Adjusted 2022 Guidance - Assuming no ONP availability

Adjusted Guidance Q1 (actual) Q2 (actual) Q3 (actual) Q4 (constrained) 2022
Oil wells completed 1 (10H) 1 (11H) 0 2 (13H + 12H) 4
Average Production (bopd) 11,746 14,467 12,229 16,500 13,500 - 14,000

 

USD millions, unless otherwise stated Guidance
Realized Brent (USD/bbl) $80
Average Production (bopd) 13,500 - 14,000
Net operating income $309
G&A ($22)
Net derivative settlements $22
Adjusted EBITDA $309
CAPEX ($98)
Free cash flow $211

 

Debt Reduction Strategy

The Company now expects the full bond settlement to be made by the end of Q1 2023, at which time, there will be a reduction of the call premium, saving approximately $2.6 million in buyout costs. Thereafter, as previously indicated and liquidity permitting, the Company expects to begin a capital return program to shareholders. PetroTal is currently in compliance with all bond covenants and expects to remain so prior to the expected retirement date.

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

"We continue to work with our trader to increase their overall available contracted barging fleet size to alleviate oil export constraints, which have been compounded by the unavailability of the ONP since early 2022. We are adjusting our 2022 guidance to reflect a conservative sales scenario, which we hope to exceed should the ONP become a viable sales option in Q4 2022. Under this conservative scenario, cash flow is still very strong allowing the Company to deliver on its promised shareholder return program in 2023. Additionally, we are looking forward to finalizing the ongoing successful working table discussions related to the social trust."

ABOUT PETROTAL

PetroTal is a publicly traded, tri quoted (TSXV: TAL) (AIM: PTAL) and (OTCQX: 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 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)
Ritchie Balmer / James Spinney / Robert Collins
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

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

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; PetroTal's revised 2022 guidance and budget including, but not limited to, estimated or anticipated production levels, capital expenditures and drilling plans; the intention to redeem the outstanding bonds; PetroTal plans to deliver strong operational performance and to generate free cash flow and growth; capital requirements and the Company's ability to access capital on desirable terms and within required timelines; 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 and operate at unrestricted levels; anticipated future production and revenue; drilling plans including the timing of drilling, commissioning, and startup and the impact of delays thereon; oil production levels, including average and exit production in 2022; sales expansion through alternative exports routes, including barging and trucking; the Company's proposals for collaboration with local communities; and future development and growth prospects. 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, impact of inflation on costs, 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, wars (including Russia's war in Ukraine), 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. The ongoing war between Russia and Ukraine has the potential to threaten the supply of oil and gas from the region. The long-term impacts of the war between these nations remains uncertain. 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, increased operating and capital costs due to inflationary pressures, business, financial conditions, results of operations and other factors relevant to the Company. Please refer to the risk factors identified in the Corporation's annual information form (filed April 28, 2022) and MD&A (filed August 25, 2022) (the "MD&A"), which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

SPECIFIED FINANCIAL MEASURES: This press release includes various specified financial measures, including non-GAAP financial measures, non-GAAP financial ratios and capital management measures as further described herein. These measures do not have a standardized meaning prescribed by generally accepted accounting principles ("GAAP") and, therefore, may not be comparable with the calculation of similar measures 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. "Adjusted EBITDA" (non-GAAP financial measure) is calculated as consolidated net income (loss) before interest and financing expenses, income taxes, depletion, depreciation and amortization and adjusted for G&A impacts and certain non-cash, extraordinary and non-recurring items primarily relating to unrealized gains and losses on financial instruments and impairment losses, including derivative true-up settlements. PetroTal utilizes adjusted EBITDA as a measure of operational performance and cash flow generating capability. Adjusted EBITDA impacts the level and extent of funding for capital projects investments. Reference to EBITDA is calculated as net operating income less G&A. "Free cash flow" (non-GAAP financial measure) is calculated as net operating income less G&A less exploration and development capital expenditures and is calculated prior to all debt service, taxes, lease payments, hedge costs, factoring, and lease payments. Management uses free cash flow to determine the amount of funds available to the Company for future capital allocation decisions. Please refer to the MD&A for additional information relating to specified financial measures.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about PetroTal's revised budget and guidance, prospective results of operations, production and production capacity, free cash flow, revenue, adjusted EBITDA, debt repayment, liquidity, shareholder returns 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 TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/140338


PetroTal Announces Exercise of Performance Warrants and Total Voting Rights

Calgary, AB and Houston, TX – October 10, 2022 - PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL, AIM: PTAL and OTCQX: PTALF) announces that it received a notice to exercise 402,806 Performance Warrants at a price of US$0.1869 (in a net basis) per Common Share.

Following this warrant exercise, the Company will have 963,440 Performance Warrants outstanding.  Application will be made for admission of the 402,806 common shares, which will rank pari passu with existing Common Shares, to trading on AIM ("Admission"), which is expected to occur on or around October 13, 2022.

Following Admission, the Company will have 859,323,993 common shares issued and there are no shares held in treasury.  This figure may be used by shareholders as the denominator for the calculations to 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, tri‐quoted (TSXV: TAL, AIM: PTAL and OTCQX: 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)
Ritchie Balmer / James Spinney / Robert Collins
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; and the impact of social disruption on the Company's operations, including a potential field shutdown at Bretana. 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. 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 three and nine months ended September 30, 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.

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

 


PetroTal Announces Results of Shareholders' Meeting, Director Dealing, TVR and Other Corporate Items

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - September 20, 2022) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) (OTCQX: PTALF) ("PetroTal" or the "Company") is pleased to announce that all matters presented for approval at the annual special meeting of shareholders held on September 15, 2022 have been fully authorized and approved.

Annual General and Special Meeting on September 15, 2022

The Company welcomes two new directors (Messrs. Carranza and Harris), and thanks retiring directors (Messrs. Guidry and Ellson). The following are PetroTal's duly elected Directors:

Mark McComiskey - Chair
Manuel Pablo Zuniga-Pflucker - President and CEO
Eleanor Barker - Non-Executive Director
Luis Carranza - Non-Executive Director
Jon Harris - Non-Executive Director
Roger Tucker - Non-Executive Director
Gavin Wilson - Non-Executive Director

PSU Issue

The Company also announces that it has issued an aggregate of 5,547,808 Common Shares to employees 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. Of the 5,547,808 Common Shares issued, 4,442,890 Common Shares were issued to Officers.

Further details regarding the Company's PSU plan are set out in the management information circular of the Company dated August 3, 2022 which is available on SEDAR at www.sedar.com.

Exercise of Investor Warrants

The Company has received a notice to exercise 878,220 Investor Warrants at a price of 16 pence per Common Share from an investor in relation to the Investor Warrants issued on June 12, 2020. The Company received proceeds of £140,515 from the Investor Warrants exercised and has issued 878,220 new Common Shares.

Exercise of Performance Warrants

The Company has received a notice to exercise 300,000 Performance Warrants at a price of $0.1869 per Common Share from a warrant holder. The Company received $56,070 USD from the Performance Warrants exercised and has issued 300,000 new Common Shares.

Following the abovementioned warrant exercises, the Company will have 59,875,687 and 1,603,440 Investor Warrants and Performance Warrants, respectively, outstanding.

Admission to Trading and TVR

For the above issuances, application will be made to the London Stock Exchange for the admission of, in aggregate, 6,726,028 Common Shares to trading on AIM ("Admission") and to the TSXV for listing of 6,726,028 Common Shares for trading on the facilities of the TSXV. It is expected that Admission will become effective at 8:00 am London time on or around September 23, 2022.

Following Admission, the Company will have 858,921,187 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 858,921,187 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.

PDMR Notification Form

1 Details of the person discharging managerial responsibilities / person closely associated
a) Name
  1. Manuel Pablo Zuniga-Pflucker
  2. Douglas Urch
2 Reason for the notification
a) Position/status
  1. President & Chief Executive Officer
  2. Executive Vice President & Chief Financial Officer
b) Initial notification /Amendment Initial notification
3 Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor
a) Name PetroTal Corp.
b) LEI 21380047ER33PRH4XH56
4 Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a) Description of the financial instrument, type of instrument PetroTal Corp. Common Shares
Identification code CA71677J1012
b) Nature of the transaction Issue of Common Shares under the Company's performance and restricted share unit plan
c) Price(s) and volume(s)
Price Volume
n/a
n/a
3,310,577
1,132,313
d) Aggregated information n/a
- Aggregated volume
- Price
e) Date of the transaction 15 September 2022
f) Place of the transaction TSX-V Exchange

 

ABOUT PETROTAL

PetroTal is a publicly traded, tri quoted (TSXV: TAL) (AIM: PTAL) and (OTCQX: 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 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)
Ritchie Balmer / James Spinney / Robert Collins
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

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.

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; and the AGM. 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. Please refer to the risk factors identified in the Corporation's most recent annual information form and MD&A, which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/137748


PetroTal Announces Additional Director Nominees & Retirements for Upcoming Shareholder Meeting and Provides Virtual Meeting Details

Virtual AGM on September 15, 2022 at 10:00am MT, 15:00 UK Time

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - September 7, 2022) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) (OTCQX: PTALF) ("PetroTal" or the "Company") is pleased to announce Messrs. Luis Carranza and Jon Harris as additional director nominees for election at the upcoming shareholder meeting ("AGM") to be held on Wednesday, September 15, 2022 at 10:00 am Mountain Time, 15:00 UK time.

In addition, the Company is also announcing the retirement of Messrs. Gary Guidry and Ryan Ellson, who will not be standing for re-election at the AGM and will step off the Board of the Company at the close of the AGM. PetroTal sincerely thanks Gary Guidry and Ryan Ellson for their significant contributions and guidance since inception of PetroTal in late 2017.

In addition to the five nominees (all of which are existing directors) described in the Company's Management Information Circular and Proxy Statement dated August 3, 2022 (the "Circular"), which is available on SEDAR (www.sedar.com) and the Company's website (www.petrotal-corp.com), the new nominee backgrounds are as follows:

Luis Carranza

Mr. Carranza, a resident of Lima, Peru, brings a wealth of financial and Peruvian regulatory expertise to the Company. Mr. Carranza was formerly the Director of the Institute of Government and Public Management at the University of San Martín de Porres, Peru. During 2017-2021, he served as CEO of CAF, Development Bank of Latin America. Mr. Carranza was also CEO of Sigma Capital, an infrastructure advisory firm, Chief Economist for Latin America and Emerging Markets at BBVA, and a Director of several companies.

He has been Peru's Minister of Finance on two occasions, Deputy Minister of Finance and Director of the Central Reserve Bank of Peru and is highly educated on many government mandates, laws and regulatory workings.

We anticipate Mr. Carranza will be critical in recommending commercial policy within the Company to navigate the Peruvian financial and social landscape. He holds a PhD in Economics from the University of Minnesota, USA.

Jon Harris

Mr. Harris, a resident of London, England, is an executive and industry leader in the oil and gas industry, and since January 2021, has been Chief Executive Officer of Gulf Keystone Petroleum, a London-listed company. Mr. Harris has over 30 year's experience in the oil and gas industry at SASOL Limited, an integrated energy and chemicals company based in South Africa where he was Executive Vice President, Upstream. Previously, he spent 25 years with BG Group in various international roles, including Executive Vice President Technical and General Manager Production Operations, as well as senior management assignments in the United States, Trinidad/Tobago and Egypt.

With a history of delivering success and shareholder value in international E&P, Jon will provide critical technical and commercial guidance as PetroTal continues with ongoing development and growth. Jon received a Master of Engineering in Fuel and Energy (with distinction) from the University of Leeds, UK.

Management intends to rely on its discretionary authority granted in proxies currently being solicited in conjunction with the Circular, to vote in favour of the election of Messrs. Carranza and Harris. A ballot will be taken at the AGM in connection with the election of the directors of the Company and resolving to set the number of directors to be elected at seven.

2022 Virtual AGM Link:

Shareholders are invited to attend the AGM virtually using the following meeting link:

https://stream.brrmedia.co.uk/broadcast/62e1182486ba30292435cd1d

Dial in options are as follows:

+44 203 481 5240 United Kingdom
+44 203 901 7895 United Kingdom
+1 587 328 1099 Canada
+1 647 374 4685 Canada
+1 647 558 0588 Canada
+1 778 907 2071 Canada

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

"We would like to sincerely thank Gary and Ryan for their significant contributions to PetroTal. They have been with the Company since inception and have provided excellent guidance over the years. The PetroTal team and I would like to extend a warm welcome to Luis Carranza and Jon Harris. Both bring extensive industry and management experience to complement our existing Board and I look forward to delivering PetroTal's growth objectives, together, in the future."

Further information on Director appointments:

The following details in relation to the new Director appointments are disclosed in accordance with AIM Rule 17 and Schedule 2(g) of the AIM Rules:

Luis Julian Martin Carranza Ugarte (aged 55) holds or has held the following directorships and/or partnerships in the past five years.

Current Directorships

Automotores Gildemeister Peru SA (Peru)

Alicorp SAA (Peru)

BBVA Colombia SA (Colombia)

Sigma Capital SAC

Directorships held over the past 5 years

 

As of the date of this announcement, Mr. Carranza holds no ordinary shares or options in the Company.

Jonathan Reay Harris (aged 56) holds or has held the following directorships and/or partnerships in the past five years.

Current Directorships

Gulf Keystone Petroleum Limited (Bermuda)

Directorships held over the past 5 years

Sasol Investment Company (Pty) Ltd (South Africa)

Sasol Ltd (South Africa)

Sasol Canada Holdings Ltd (Alberta, Canada)

Sasol Africa (Pty) Ltd (South Africa)

Sasol Mining Holdings (Pty) Ltd (South Africa)

Sasol Mining (Pty) Ltd (South Africa)

 
As of the date of this announcement, Mr. Harris holds no ordinary shares or options in the Company.

There is no further information to be disclosed under Schedule Two, paragraph (g) of the AIM Rules for Companies.

ABOUT PETROTAL

PetroTal is a publicly traded, tri quoted (TSXV: TAL) (AIM: PTAL) (OTCQX: 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 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)
Ritchie Balmer / James Spinney / Robert Collins
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

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.

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; and the AGM. 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. Please refer to the risk factors identified in the Corporation's most recent annual information form and MD&A, which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/136176


PetroTal Announces Q2 2022 Financial and Operating Results

Seventh straight quarter of production growth
Generated nearly $100 million in net operating income in Q2 2022
Reiterating 2022 Guidance

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - August 25, 2022) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) (OTCQX: PTALF) ("PetroTal" or the "Company") is pleased to announce its financial and operating results for the three months ended June 30, 2022 ("Q2 2022").

Selected financial and operational information is outlined below and should be read in conjunction with the Company's unaudited consolidated financial statements ("Financial Statements"), and management's discussion and analysis ("MD&A") for the three and six months ended June 30, 2022, 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.

PetroTal delivered solid Q2 2022 financial and operational performance highlighted by record production rates, record cash flow, and a robust balance sheet profile with a substantial net cash position.

Q2 2022 Highlights

  • Achieved record quarterly production of 14,467 barrels of oil per day ("bopd") and quarterly sales of 14,616 bopd, up 25% and down 5%, respectively, from Q1 2022, representing the Company's seventh straight quarter of production growth, with unencumbered sales for the majority of the quarter;
  • Completed well 11H on June 30, 2022, which produced over 300,000 barrels of oil over its first 30 full days on production, has paid out its capital investment, and averaged over 9,000 bopd from August 1 to 22, 2022;
  • Achieved a new daily Company production record of 25,218 bopd on July 1, 2022 with production briefly reaching 26,000 bopd, representing the maximum capacity at the newly expanded Central Processing Facility ("CPF-2");
  • Sold approximately 86% of sales through the Brazilian route with the remaining 14% sold to the Iquitos Refinery while the Northern Peruvian Oil Pipeline ("ONP") was offline, successfully redirecting 456,000 barrels from the ONP to the Brazilian market;
  • Significantly reduced transportation costs through significantly reduced diluent blending requirements to Brazil, contributing to record low transportation costs of $3.4 million ($2.54/bbl);
  • Generated record net operating income ("NOI") and EBITDA(a) of $98.6 million and $93.4 million, respectively, both up three and a half fold from Q2 2021 levels and almost double from Q1 2022;
  • Generated record free cash flow(a) of $69.4 million before changes in non-cash working capital and debt service, accumulating over $100 million, for the six months ended June 30, 2022;
  • Invested approximately $24.0 million in capital expenditures ("Capex"), lower than revised guidance by $5 million, due to drilling delays from the March 2022 social protests. Approximately two thirds of Capex spent was for drilling and completion related investments with the remainder divided amongst smaller production operation projects;
  • On April 1, 2022, the Company paid $20 million of principal to bondholders through the 101% call option mechanism set out in the bond agreement. As of June 30, 2022 and August 25, 2022, the Company is in compliance with all covenants; with $80 million of bond principal remaining; and,
  • Exited the quarter with $77 million of total cash, including $13.5 million of restricted cash, and approximately ($79) million in net debt/(surplus)(1), a record level for the Company allowing for a future return of capital program in Q4 2022 or Q1 2023, with an extremely solid balance sheet profile.

(1) Net debt/(surplus) defined as cash and restricted cash + VAT receivable (short and long term) + trade receivables + short term and long term derivative assets - AP - short and long term leases - short and long term debt - derivative obligation

Selected Financial and Operational Highlights


 Three Months Ended   Six Months Ended  
(in thousands USD) June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021  
Financial
Crude oil revenues 118,435 42,809 211,187 75,165
Royalties (8,104 ) (2,306 ) (14,477 ) (4,054 )
Net operating income (1) 98,589 29,677 162,783 49,647
Commodity price derivative (gain)/loss (6,533 ) 4,147 (27,546 ) (18,365 )
Net income 84,249 11,373 148,759 42,159
Diluted net income (US$/share) 0.10 0.01 0.18 0.05
Capital expenditures 24,024 22,363 41,553 29,476  
Operating        
Average production (bopd) 14,467 8,839 13,114 8,089
Average sales (bopd) 14,616 8,842 15,065 8,711
Average Brent price ($/bbl) 111.80 69.01 101.54 64.28
Contracted sales price, gross ($/bbl) 111.39 66.55 99.42 62.79
Netback ($/bbl)(2) 74.13 36.88 59.70 31.49
Funds flow provided by operations(2) 60,688 19,627 66,432 24,094
Balance sheet        
Cash and restricted cash     77,017 79,491
Working capital     141,971 62,634
Total assets     535,202 359,788
Current liabilities     92,988 72,639
Equity     357,732 180,291  

 

1. Net operating income and Netback represent revenues less royalties, operating expenses, and direct transportation.
2. Netback per barrel ("bbl") and funds flow provided by operations do not have standardized meaning prescribed by GAAP and therefore may not be comparable with the calculation of similar measures for other entities. See "Selected Financial Measures" section.

Q2 2022 Financial Results

Record revenue. Oil revenue was $118.4 million ($89.04/bbl) compared to Q2 2021 of $42.8 million ($53.20/bbl) and Q1 2022 of $92.7 million ($66.41/bbl).

Record net operating income. Generated record NOI and EBITDA(a) of $98.6 million ($74.13/bbl) and $93.4 million ($70.26/bbl), respectively, compared to $29.7 million ($36.88/bbl) and $26.4 million ($32.87/bbl), respectively, in Q2 2021 and $64.2 million ($45.96/bbl) and $58.7 million ($42.58/bbl), respectively, in Q1 2022.

Capital investment. Capital expenditures in the quarter totalled $24.0 million and were focused on drilling and completing well 11H and advancing infrastructure projects. The total represented approximately 88% of the budget, due to deferral of drilling activity as a result of the social protest activity in March 2022, and deferral of additional facility and water disposal work until 2023. First half 2022 capital expenditures are $41.6 million, trending well under the $70.0 million approved budget.

Record Q2 and YTD 2022 free cash flow. Generated record free cash flow(a) before changes in non-cash working capital and debt service of $69.4 million. Total free cash flow for the six months ended June 30, 2022 has surpassed $100 million, significantly boosting the Company's liquidity profile.

Lower operating costs. Total quarterly lifting costs were $8.4 million ($6.28/bbl), a decrease from Q1 2022 of $10.1 million ($7.20/bbl) and from Q2 2021 of $5.5 million ($6.84/bbl), driven by lower contracted operations and COVID 19 expenses.

Record low transportation costs. Diluent and barging costs were $3.4 million ($2.54/bbl) in the quarter, reduced significantly from $12.1 million ($8.68/bbl) in Q2 2022, and down from $5.3 million ($6.61/bbl) in Q2 2021. The decrease was supported by lower barging standby time, and significantly lower diluent and diesel costs from shipping through the Brazil and Iquitos routes instead of incurring ONP costs.

G&A on budget. Q2 2022 G&A was $5.1 million ($3.87/bbl) compared to $4.7 million ($3.38/bbl) in Q1 2022 and $3.2 million ($4.01/bbl) in Q2 2021 representing a 15% and 3% increase and decrease, respectively, on a per barrel basis.

Record net income. Net income was $84.2 million an increase of 31% over Q1 2022 of $64.5 million and significantly exceeding $11.4 million in Q2 2021.

Balance sheet reflects a record net debt/(surplus) position. Net debt/(surplus) was approximately ($79) million as at June 30, 2022, as defined internally by the Company.

Large net derivative asset balance. The total net derivative asset on the balance sheet as at June 30, 2022 was $56.8 million, consisting mostly of the true up value of oil in the ONP. As at June 30, 2022 approximately 3.1 million barrels remained in the ONP backstopping the net derivative value with a much lower cost base from sales made in 2020 and 2021. With the ONP maintenance estimated to be completed in October 2022, and the pipeline operational again, the schedule to realize the derivative value has shifted primarily into 2023, which will further supplement the Company's expected cash reserves.

Operational and Financial Highlights Subsequent to June 30, 2022

Bayovar Export Realized. As announced on June 16, 2022 and July 5, 2022, Petroperu delivered approximately 550,000 barrels through the ONP to Bayovar and exported nearly 720,000 barrels to an international refiner. The Company expects to receive $53.9 million from Petroperu, net of usual ONP fees and adjustments. Post this Bayovar export, the amount of oil remaining in the ONP dropped from 3.1 million barrels to approximately 2.4 million barrels.

Navigating barging challenges. During July, the Company encountered barging delays that were compounded by the closure of the ONP, resulting in production constraints that lowered the average production to 5,700 bopd from July 7 until July 25. The Company has secured approximately 420,000 barrels of export barging capacity for August 2022 plus 60,000 barrels for the Iquitos Refinery which has allowed production to increase to 19,000 bopd since August 22, 2022. PetroTal continues to explore long term solutions to ensure appropriate barging capacity is available to accommodate higher oil production rates and to optimize logistics and barging fleet size for our Brazilian route.

Drilling schedule adjustments. Due to well servicing and a conductor pipe placement for a future well, the Company's revised drilling plan now schedules drilling the 13H well to be followed by the 12H well. The 13H was spud on August 24, 2022 and is estimated to be on production by late October.

Current liquidity update. Current total cash as at August 15, 2022 is approximately $115 million including $15 million in restricted cash and up to date payments from our Brazilian route shipping counterparty, but not including outstanding amounts owing from Petroperu.

Corporate Hedging Update. PetroTal recently sold a swap at $62.05/bbl and bought a call at $70.00/bbl on approximately 750,000 barrels of H2 2022 production. PetroTal will receive cash when the Brent oil price is above $70/bbl, and will have a floor price of $62.05/bbl. After this hedge, the Company is approximately 25% hedged on corporate production volumes in Q3 and Q4 2022. As 2022 progresses, the Company will look to layer in additional hedges for H1 2023 on up to 25% of total corporate production.

Ten million barrels produced. On August 22, 2022, the Company formally surpassed the ten million barrels of produced oil milestone in only four years.

Reiterating 2022 Guidance

The Company is reiterating guidance provided in May 2022 as navigated a number of logistical issues caused by the ONP shut down and barging fleet delays. The Company estimated 2022 average production to be between 15,000 bopd and 16,000 bopd and the latest production forecast confirms the lower end of this range. Thanks to higher oil prices and lower diluent costs, the Company maintains EBITDA to be approximately $340 million and associated free cash flow before working capital and debt service to be approximately $230 million. The reiterated guidance is highly dependent on certain sales route availability assumptions, ONP maintenance completion schedules, and Petroperu's unencumbered access to credit, which if different from current estimates could materially alter the reiterated guidance.

As a result of the revised drilling schedule, the Company is guiding 15,000 bopd, and has adjusted Q3 and Q4 2022 production profiles to the following levels as dictated by available sales scheduling:

Adjusted Guidance Q1 (actual) Q2 (actual) Q3 Q4 2022
Oil wells completed 1 (10H) 1 (11H) 0 2 4
Average Production (bopd) 11,746 14,467 14,250 19,500 15,000
CAPEX (millions) $18 $24 $29 $40 $111

 

USD millions Guidance
Contracted Brent (USD/bbl) $102
Average Production (bopd) 15,000 - 16,000 (25% downtime)
Net operating income $351
G&A ($22)
Net derivative settlements(1) $13
Adjusted EBITDA1 $342
CAPEX ($111)
Free cash flow $231

 

(1) Approximately $33 million in anticipated 2022 true-up revenue has now been deferred into 2023 as a result of the ONP maintenance.

Updated Corporate Presentation, investor webcast and AGM reminder

PetroTal will host an investor webcast on August 25, 2022 at 9:00 am CT (3:00 pm BST), following release of the Q2 2022 results. The Company has also provided an updated corporate presentation inclusive of the Q2 2022 results, on its website. PetroTal's 2021 AGM will be held virtually on September 15, 2022.

Link to PetroTal Q2 2022 webcast
https://stream.brrmedia.co.uk/broadcast/62e8f64f04182f363ba99aa2

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

"We would like to thank our entire team for another record quarter on many fronts. Though we have experienced recent production constraints from short term sales bottlenecks, unconstrained production run rates are over 20,000 bopd which we successfully tested in our facilities. The outlook for PetroTal's low sulfur oil remains incredibly robust with recent strong export demand realized. We continue to meet commercial challenges head on and are excited about potential short- and long-term solutions for PetroTal's river transportation options. From a social perspective, the 2.5% social fund working table sessions have been extremely productive, transparent, and aligned, creating the necessary stability our field has strived for over the years. Many milestones have yet to be achieved, however, the initiatives remain on track and functioning as planned with more formal updates on this to come in H2 2022. Finally, I would like to congratulate the entire PetroTal team on our recent milestone of ten million barrels produced in only four short years since first production."

ABOUT PETROTAL

PetroTal is a publicly traded, tri quoted (TSXV: TAL) (AIM: PTAL) (OTCQX: 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 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)
Ritchie Balmer / James Spinney / Robert Collins
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

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.

READER ADVISORIES

Notes to Press Release
(a) See "Specified Financial Measures".

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 impact of social disruption on the Company's operations; drilling, completions, workovers and other activities and the anticipated costs and results of such activities; PetroTal's revised 2022 guidance and budget including, but not limited to, estimated or anticipated production levels, capital expenditures and drilling plans; PetroTal plans to deliver strong operational performance and to generate free cash flow and growth; capital requirements; 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 and operate at unrestricted levels; anticipated future production and revenue; drilling plans including the timing of drilling, commissioning, and startup and the impact of delays thereon; oil production levels, including average and exit production in 2022; sales expansion through alternative exports routes, including barging and trucking; the Company's proposals for collaboration with local communities; and future development and growth prospects. 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. Without limitation of the foregoing, future dividend payments, if any, and the level thereof, is uncertain, as the Company's dividend policy and the funds available for the payment of dividends from time to time is dependent upon, among other things, free cash flow financial requirements for the Company's operations and the execution of its growth strategy, fluctuations in working capital and the timing and amount of capital expenditures, debt service requirements and other factors beyond the Company's control. Further, the ability of PetroTal to pay dividends will be subject to applicable laws (including the satisfaction of the solvency test contained in applicable corporate legislation) and contractual restrictions contained in the instruments governing its indebtedness. 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 labor, royalty regimes and exchange rates, impact of inflation on costs, 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, wars (including Russia's military actions in Ukraine), 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. Ongoing military actions between Russia and Ukraine have the potential to threaten the supply of oil and gas from the region. The long-term impacts of the actions between these nations remains uncertain. 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, increased operating and capital costs due to inflationary pressures, business, financial conditions, results of operations and other factors relevant to the Company. Please refer to the risk factors identified in the Corporation's most recent annual information form and MD&A, which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

SHORT-TERM PRODUCTION RATES: References in this press release peak production, initial 30 days of production and other short-term production rates are useful in confirming the presence of hydrocarbons, however such rates are not determinative of the rates at which such wells will commence production and decline thereafter and are not indicative of long-term performance or of ultimate recovery. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for PetroTal. The Company cautions that 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.

SPECIFIED FINANCIAL MEASURES: This press release includes various specified financial measures, including non-GAAP financial measures, non-GAAP financial ratios and capital management measures as further described herein. These measures do not have a standardized meaning prescribed by generally accepted accounting principles ("GAAP") and, therefore, may not be comparable with the calculation of similar measures 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" (non-GAAP financial ratio) equals total petroleum sales less quality discount, lifting costs, transportation costs and royalty payments calculated on a bbl basis. The Company considers netbacks to be a key measure as they demonstrate Company's profitability relative to current commodity prices. "Funds flow provided by operations" (non-GAAP financial measure) includes all cash generated from operating activities and is calculated before changes in non-cash working capital. "Adjusted EBITDA" (non-GAAP financial measure) is calculated as consolidated net income (loss) before interest and financing expenses, income taxes, depletion, depreciation and amortization and adjusted for G&A impacts and certain non-cash, extraordinary and non-recurring items primarily relating to unrealized gains and losses on financial instruments and impairment losses, including derivative true-up settlements. PetroTal utilizes adjusted EBITDA as a measure of operational performance and cash flow generating capability. Adjusted EBITDA impacts the level and extent of funding for capital projects investments. Reference to EBITDA is calculated as net operating income less G&A. "Free cash flow" (non-GAAP financial measure) is calculated as net operating income less G&A less exploration and development capital expenditures and is calculated prior to all debt service, taxes, lease payments, hedge costs, factoring, and lease payments. Management uses free cash flow to determine the amount of funds available to the Company for future capital allocation decisions. Please refer to the MD&A for additional information relating to specified financial measures.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about PetroTal's revised budget and guidance, prospective results of operations, production and production capacity, free cash flow, revenue, adjusted EBITDA, debt repayment, liquidity, shareholder returns 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.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/134790


PetroTal Announces Exercise of Performance Warrants and Total Voting Rights

Calgary, AB and Houston, TX – August 10, 2022 - PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL, AIM: PTAL and OTCQX: PTALF) announces that it received a notice to exercise 267,500 Performance Warrants at a price of US$0.1869 per Common Share.  Accordingly, PetroTal received a total of US$49,996 in respect for the warrants exercised.

Following this warrant exercise, the Company will have 1,903,440 Performance Warrants outstanding.  Application will be made for admission of the 267,500 common shares, which will rank pari passu with existing Common Shares, to trading on AIM ("Admission"), which is expected to occur on or around August 15, 2022.

Following Admission, the Company will have 852,195,159 common shares issued and there are no shares held in treasury.  This figure may be used by shareholders as the denominator for the calculations to 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, tri-quoted (TSXV: TAL, AIM: PTAL and OTCQX: 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)
Ritchie Balmer / James Spinney / Robert Collins
T: thanks +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; and the impact of social disruption on the Company's operations, including a potential field shutdown at Bretana. 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. 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 three and nine months ended September 30, 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.

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


PetroTal Announces Exercise of Performance Warrants and Total Voting Rights

Calgary, AB and Houston, TX – July 25, 2022 - PetroTal Corp. (“PetroTal” or the “Company”) (TSX-V: TAL, AIM: PTAL and OTCQX: PTALF) announces that it received a notice to exercise 210,000 Performance Warrants at a price of US$0.1869 per Common Share.  Accordingly, PetroTal received a total of US$39,249 in respect for the warrants exercised.

Following this warrant exercise, the Company will have 2,170,940 Performance Warrants outstanding.  Application will be made for admission of the 210,000 common shares, which will rank pari passu with existing Common Shares, to trading on AIM ("Admission"), which is expected to occur on or around July 29, 2022.

Following Admission, the Company will have 851,927,659 common shares issued and there are no shares held in treasury.  This figure may be used by shareholders as the denominator for the calculations to 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, tri‐quoted (TSXV: TAL, AIM: PTAL and OTCQX: 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 : thanks +44 (0) 208 434 2643

Strand Hanson Limited (Nominated & Financial Adviser)
Ritchie Balmer / James Spinney / Robert Collins
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; and the impact of social disruption on the Company's operations, including a potential field shutdown at Bretana. 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. 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 three and nine months ended September 30, 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. 

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.