PetroTal Announces Closing of
Block 131 Acquisition
Calgary, AB and Houston, TX -
December 2, 2024-PetroTal
Corp. ("PetroTal" or the
"Company") (TSX: TAL, AIM:
PTAL and OTCQX: PTALF) is pleased to announce that it has closed
the acquisition of a 100% working interest in Peru's Block 131, as
originally disclosed on May 8, 2024, pursuant to which the Company
acquired all of the issued and outstanding shares of CEPSA Peruana,
S.A.C. ("CEPSA Peru"),
which represents the entire Peruvian business unit of Compañía
Española de Petróleos S.A. ("CEPSA").
Manuel Pablo Zúñiga-Pflücker,
President and Chief Executive Officer, commented:
"The acquisition of Block 131 represents an important
milestone for PetroTal, and a pivotal step in the Company's growth
strategy. Importantly, Block 131 diversifies our production base
within Peru, establishing a new platform for future production and
reserves growth.
PetroTal's technical team has already identified numerous
synergies between the Block 131 assets and our existing operations
at Block 95. Similar to the strategy we have already successfully
employed at Bretaña, we plan to apply modern drilling techniques at
the Los Angeles field, which has significant unutilized facility
capacity. We are currently finalizing our development plan for the
assets and look forward to providing more details at the
appropriate time."
Key
Highlights of the Acquired Assets
The Los Angeles field at Block 131
has produced an average of 817 barrels of light oil per day
("bopd") from January 1 to September 30, 2024. The on-site facility
infrastructure site was built to accommodate throughput of up to
5,500 bopd, providing a clear runway for production growth and
improved unit operating cost structure. The produced oil is 45°API,
which offers potential for marketing synergies with PetroTal's
heavy Bretaña crude. Additional highlights include:
· Visibility for
low-cost, light oil production and reserve additions in the
near-term, with upside resource potential in deeper, unproduced
zones.
· PetroTal estimates
remaining Proved recoverable reserves are 2.0 million barrels
("bbls") of light oil, and 4.2 million bbls of Proved plus Probable
reserves. PetroTal sees upside to reserve bookings given
multi-horizon reservoir potential and improved geophysical
interpretations.
· Blending of Block
131's light oil production may allow PetroTal to increase sales of
heavy Bretaña crude to the Iquitos refinery, at improved
differentials to the Brent benchmark.
Asset Background
The Los Angeles oil field at Block
131 was discovered by CEPSA Peru in 2013. As of September 30, 2024
the field has produced a total of approximately 7.8 million bbls.
Block 131 is held under an exploration and production license
agreement expiring in 2038, subject to a 23.48% royalty rate at
field production levels under 5,000 bopd, with a similar scaling
factor to Block 95 above 5,000 bopd. All produced oil is currently
sold to PetroPeru, Peru's state-owned oil company, at Pucallpa. The
oil is then transported by barge along the Ucayali River (passing
PetroTal's Bretaña oil field) to the Iquitos refinery.
Qualified Person's Statement
Max Torres, the Vice President of
Exploration for PetroTal, has approved the technical information
contained in this announcement. Mr. Torres has more than 35 years
of relevant professional experience in the oil and gas industry. He
holds a Bachelor of Science degree in Geology from the Universidad
Nacional de Tucumán, Argentina, and a Master of Science degree from
Georgia State University.
The recovery and reserve estimates
provided in this news release are estimates only, and there is no
guarantee that the estimated reserves will be recovered. Actual
reserves may eventually prove to be greater than, or less than, the
estimates provided herein.
ABOUT
PETROTAL
PetroTal is a publicly traded,
tri‐quoted (TSX: 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 the
Bretaña Norte oil field in Peru's Block 95, where oil production
was initiated in June 2018. In early 2022, 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 Bretaña
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.sedarplus.ca,
or below:
Camilo McAllister
Executive Vice President and Chief
Financial Officer
Cmcallister@PetroTal-Corp.com
T: (713) 253-4997
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) 20 7770 6424
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
T: +44 (0) 20 7710 7600
Peel Hunt LLP (Joint
Broker)
Richard
Crichton / David McKeown / Georgia Langoulant
T: +44 (0) 20 7418
8900
READER ADVISORIES
FORWARD-LOOKING STATEMENTS: This
press release contains certain statements that may be deemed to be
forward-looking statements. Such statements relate to possible
future events, including, but not limited to: PetroTal's business
strategy, objectives, strength and focus; the anticipated benefits
of the acquisition of CEPSA Peruana, S.A.C. (the "Acquisition"),
including the impact of the Acquisition on the Company's
operations, reserves, oil production levels and production capacity
and overall strategy; expectations with respect to the sufficiency
of current infrastructure to support up to 5,500 bopd; and
development and drilling plans for the assets acquired pursuant to
the Acquisition (the "Assets"). 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", "intend" and similar expressions. The forward-looking
statements provided in this press release are based on management's
current belief, based on currently available information, as to the
outcome and timing of future events. 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 to obtain and
maintain necessary permits and licenses, the ability of government
groups to effectively achieve objectives in respect of reducing
social conflict and collaborating towards continued investment in
the energy sector, reservoir characteristics, recovery factor,
exploration upside, prevailing commodity prices and the actual
prices received for PetroTal's products, including pursuant to
hedging arrangements, the availability and performance of drilling
rigs, facilities, pipelines, other oilfield services and skilled
labour, royalty regimes and exchange rates, the 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, availability of required equipment and service; and the
successful integration of the Assets into PetroTal's
operations. PetroTal cautions that
forward-looking statements relating to PetroTal are subject to all
of the risks, uncertainties and other factors, which may cause the
actual results, performance, capital expenditures or achievements
of the Company to differ materially from anticipated future
results, performance, capital expenditures or achievement expressed
or implied by such forward-looking statements. Factors that
could cause actual results to differ materially from those set
forth in the forward-looking statements include, but are not
limited to, unforeseen difficulties in integrating the Assets into
PetroTal's operations; incorrect assessments of the value of
benefits to be obtained from acquisitions and exploration and
development programs (including the Acquisition); 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), business performance,
legal and legislative developments including changes in tax laws
and 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, credit ratings and risks,
fluctuations in interest rates and currency values, changes in the
financial landscape both domestically and abroad, including
volatility in the stock market and financial system, wars
(including Russia's war in Ukraine and the
Israeli-Hamas conflict), regulatory developments, commodity price
volatility, price differentials and the actual prices received for
products, exchange rate fluctuations, legal, political and economic
instability in Peru, access to transportation routes and markets
for the Company's production, changes in
legislation affecting the oil and gas industry, changes in the
financial landscape both domestically and abroad (including
volatility in the stock market and financial system) and the
occurrence of weather-related and other natural catastrophes.
Readers are cautioned that the foregoing list of factors is not
exhaustive. Please refer to the annual information form for the
year ended December 31, 2023 and the management's discussion and
analysis for the three months ended June 30, 2024 for additional
risk factors relating to PetroTal, which can be accessed either on
PetroTal's website at www.petrotal-corp.com
or under the Company's profile on
www.sedarplus.ca.
The forward-looking statements contained in this press release are
made as of the date hereof and the Company undertakes no obligation
to update publicly or revise any forward-looking statements or
information, whether as a result of new information, future events
or otherwise, unless so required by applicable securities
laws.
OIL REFERENCES: All references to "light oil" in this press
release mean "light crude oil" as defined in Canadian National
Instrument 51-101 - Standards of Disclosure for Oil and Gas
Activities ("NI 51-101"). All references to "heavy oil" in this
press release mean "heavy crude oil" as defined in NI
51-101.
RESERVES DISCLOSURE. All reserves values and ancillary
information contained in this press release relating to the Assets
are derived from an independent assessment of reserves attributable
to the Assets, which was completed by Netherland Sewell and
Associates Inc. ("NSAI"), a qualified independent reserves
evaluator as defined in NI 51-101, with an effective date of March
31, 2024 (the "Reserves Report"), and prepared in accordance with
the most recent publication of the Canadian Oil and Gas Evaluation
Handbook ("COGEH") and the standards established by NI 51-101.
Estimates of reserves for individual properties may not reflect the
same level of confidence as estimates of reserves for all
properties, due to the effect of aggregation. There is no assurance
that the forecast price and cost assumptions applied by NSAI in
evaluating PetroTal's reserves will be attained and variances could
be material. The recovery and reserve estimates of PetroTal' crude
oil reserves provided herein are estimates only and there is no
guarantee that the estimated reserves will be recovered. Actual
crude oil reserves may be greater than or less than the estimates
provided herein. There are numerous uncertainties inherent in
estimating quantities of crude oil reserves. The reserve
information set forth herein are estimates only. References to
recoverable reserves in this press release include proved (1P)
reserves and proved plus probable (2P) reserves. Proved reserves
are those reserves that can be estimated with a high degree of
certainty to be recoverable. It is likely that the actual remaining
quantities recovered will exceed the estimated proved reserves.
Probable reserves are those additional reserves that are less
certain to be recovered than proved reserves. It is equally likely
that the actual remaining quantities recovered will be greater or
less than the sum of the estimated proved plus probable reserves.
Proved developed producing reserves are those reserves that are
expected to be recovered from completion intervals open at the time
of the estimate. These reserves may be currently producing or, if
shut-in, they must have previously been on production, and the date
of resumption of production must be known with reasonable
certainty. Undeveloped reserves are those reserves expected to be
recovered from known accumulations where a significant expenditure
(e.g., when compared to the cost of drilling a well) is required to
render them capable of production. They must fully meet the
requirements of the reserves category (proved, probable, possible)
to which they are assigned. Certain terms used in this press
release but not defined are defined in NI 51-101, CSA Staff Notice
51-324 - Revised Glossary to NI 51-101, Revised Glossary to NI
51-101, Standards of Disclosure for Oil and Gas Activities ("CSA
Staff Notice 51-324") and/or the COGEH and, unless the context
otherwise requires, shall have the same meanings herein as in NI
51-101, CSA Staff Notice 51-324 and the COGEH, as the case may
be.
FOFI DISCLOSURE: This press release contains future-oriented
financial information and financial outlook information
(collectively, "FOFI") about PetroTal's prospective results of
operations and production results 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 and its management
believe that FOFI has been prepared on a reasonable basis,
reflecting management's best estimates and judgments, and
represent, to the best of management's knowledge and opinion, the
Company's expected course of action. However, because this
information is highly subjective, it should not be relied on as
necessarily indicative of future results. 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. Changes in forecast commodity prices, differences in the
timing of capital expenditures, and variances in average production
estimates can have a significant impact on the key performance
measures included in PetroTal's guidance. The Company's actual
results may differ materially from these
estimates.