PetroTal Announces Third Quarter Financial Results and Operations Update

Calgary, Alberta and Houston, Texas–(Newsfile Corp. – November 19, 2019) – PetroTal Corp. (TSX: TAL) (AIM: PTAL) (“PetroTal” or the “Company“) is pleased to provide a summary of its financial and operating results as of September 30, 2019.

Selected financial and operational information is outlined below and should be read in conjunction with the Company’s unaudited consolidated financial statements (“Financial Statements”) and management’s discussion and analysis (“MD&A”) for the three and nine months ended September 30, 2019, which are available on SEDAR at and the Company’s website at All figures referred to in this press release are denominated in U.S. dollars.


Third Quarter Highlights:

  • Oil production increased to an average of 4,760 barrels of oil per day (“BOPD”), a 58% increase from Q2, 2019.
  • Recorded net income of US$3.0 million for the third quarter and US$1.9 million for the nine months period.
  • Drilled a new water disposal well.
  • Completed a workover on the existing water disposal well to convert the well into an oil producer. Upon completion, this well produced approximately 2,300 BOPD over a 30-day test period.
  • Continued with facility expansion and development of various oil sales venues.
  • Executed first transaction under the terms of the contract with Petroperu to utilize the North-Peruvian Oil Pipeline and placed 200,001 barrels of crude oil in the pipeline on August 25, 2019.
  • The Company’s cash and cash equivalents position as at September 30, 2019 was $20.5 million and not approximately $40 million, as stated in the Company’s RNS dated October 21, 2019 as set out below.

Subsequent to the Third Quarter:

  • Completed the BN 95‐4H (“4H”) horizontal well on time and under budget by approximately $3.0 million using new technology to maximize oil production.
  • The 4H initial four‐day production rate of 6,200 BOPD exceeded management’s expectations, as well as its 30-day average of 6,000 BOPD.
  • Interim upgrades to production facilities has increased production capacity.
  • Current Bretaña oil field production reached new record production with the last 30-days averaging over 8,500 BOPD, now with all five oil wells online.
  • Commenced drilling the BN 95‐5H (“5H”) well, which will be the Company’s second horizontal development oil well. The 5H is expected to be online in December, coinciding with the commissioning of the central production facility for Bretaña (“CPF-1”).
  • The Company’s cash position as at 31 October 2019 was US$21.1 million.


The Company continued the development of the Bretaña oil field and produced an average of 4,760 BOPD during the third quarter, compared to 3,010 BOPD in the fiscal second quarter. PetroTal has successfully completed the 4H well, the Company’s first horizontal well in the Bretaña oil field. The well had an approximately 500‐meter lateral completion utilizing autonomous inflow control device (“AICD”) valves to maximize oil production. Initial production from the well during the first four days of production was 6,200 BOPD. The 4H well was drilled updip towards the crest of the structure and provided data to confirm management’s analysis of the reservoir. The well was drilled under budget by approximately $3.0 million (representing a savings of approximately 20 percent), which will expedite payout of the well.

During the third quarter, the Company also upgraded the production facilities, expanding PetroTal’s production capacity to over 7,500 BOPD. The Company plans to commission phase one of its CPF-1 in December 2019, which will increase full field production capacity to over 10,000 BOPD. Incremental implementation of phase two of the Company’s production facilities (“CPF‐2”) is planned for July 2020. When CPF‐2 is fully integrated by year‐end 2020, PetroTal will have the capacity to produce up to 20,000 BOPD. Facility expansion is being implemented on a modular basis to time facilities with well completions to most efficiently deploy capital.

As a result of the Company’s successful drilling campaign in Block 95 to date, the Board of Directors approved an additional $19.0 million of capital expenditures for 2019. Approximately $14.0 million will be deployed to drill and complete the 5H well, the Company’s second horizontal well which will target updip oil to the northern portion of the structure; and $5.0 million will be directed to bring additional production facilities to the field by mid‐2020, as an interim step to installing CPF‐2 before year‐end 2020. The Company expects this additional capital to yield an additional 5,000 BOPD of capacity by mid‐2020, for a total of 12,500 BOPD. Production from the well is expected to help the Company achieve a targeted exit rate of 10,000 BOPD at year-end 2019 and fourth quarter average production of approximately 7,500 BOPD. The 5H well will also be completed with AICD valves in the lateral section. The well is expected to come online simultaneously with the facilities commissioning at year‐end.


It has come to management’s attention during the preparation of the Financial Statements that, the cash and cash equivalents amount of approximately $40 million stated in the Company’s RNS dated October 21, 2019 was incorrect.

The Company’s actual cash and cash equivalents position as at September 30, 2019 was $20.5 million, and its total current assets, which in addition to the cash and cash equivalents comprise of VAT receivables ($9.9 million), trade & other receivables ($2 million), inventory ($8.5 million), and advances & prepaid expenses ($0.78 million), totaled $41.7 million as at September 30, 2019. The main reason for the difference is that the RNS dated October 21, 2019 incorrectly grouped these current asset items as cash and cash equivalents.

Manolo Zuniga, President and Chief Executive Officer stated:

“PetroTal’s focus on the Bretana oilfield development in the third quarter represented a balanced approach between drilling and facility enhancement. The Company is well positioned to handle continued success from its drilling program.The strong performance of the 4H well demonstrates the potential of horizontal wells in this area and the benefits of using the latest engineering technology.

I congratulate the PetroTal team on all their collaborative efforts as we achieve record production levels. Innovation and optimization in all our operations is an important element to continued success. I also thank our shareholders for your continued support and confidence.”


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

Three Months Ended September 30,

Nine Months Ended September 30,





$ thousands except where defined

Oil revenues (before royalty expense)










Net income (loss)





Net loss per weighted average Common share – basic and diluted ($)





Exploration and evaluation asset expenditures





Property plant and equipment expenditures





Net working capital surplus (deficit)



Total assets



Total liabilities



Shareholders’ equity



Common Shares outstanding (000’s)




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

For further information, please contact:

Doug Urch
Executive Vice President and Chief Financial Officer
T: (713) 609-9101

Manolo Zuniga
President and Chief Executive Officer
T : (713) 609-9101

Mark Antelme / Jimmy Lea
Celicourt Communications;
T : 44 (0) 208 434 2643

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

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

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


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

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

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

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

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

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