TIDMPTAL
RNS Number : 5259K
PetroTal Corp.
29 August 2019
PetroTal Announces Second Quarter Financial Results and
Operations Update
Calgary, Alberta and Houston, Texas - August 29, 2019-PetroTal
Corp. ("PetroTal" or the "Company") (TSX-V: TAL and AIM: PTAL) is
pleased to provide a summary of its financial and operating results
as of June 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
six months ended June 30, 2019, which are available on SEDAR at
www.sedar.com and the Company's website at www.petrotal-corp.com.
All figures referred to in this press release are denominated in
U.S. dollars.
2019 SECOND QUARTER HIGHLIGHTS and OPERATIONAL UPDATE
-- Produced approximately 280,000 barrels of oil ("BO") during the second quarter
-- Production averaged 3,100 barrels of oil per day ("BOPD") versus 944 BOPD prior quarter
-- Successfully drilled and completed two oil development wells
-- Received approval of the Environmental Impact Assesssment allowing for full field development
-- Completed an upsized and oversubscribed placement of common shares, raising $24 million net
THIRD QUARTER SUBSEQUENT EVENTS
-- Re-completed water disposal well into producer in August,
initial production rate of 2,700 BOPD
-- Increased oil production to approximately 5,500 BOPD in August 2019
-- July and August (to date) 2019 cumulative production approximated 285,000 BO
OPERATIONS UPDATE
The Company continued the development of the Bretaña oil field
and produced an average of 3,100 BOPD during the quarter, compared
to 944 BOPD in the 2019 first quarter.
The Company drilled and completed the BN 95-2XD and BN 95-3D
wells in the northern section of the field. These two development
oil wells allowed the Company to increase production to over 5,000
BOPD, as expected by management.
In August, the Company re-completed the existing water disposal
well, drilled by the previous operator, and converted it to an oil
producer ("BN 95-1"). The initial production rate of the BN 95-1
was approximately 2,700 BOPD.
Currently the Company is producing just over 5,500 BOPD,
managing each of the wells at different pump rates due to capacity
of facilities which are constrained to between 5,000 and 6,000
BOPD. Due to these capacity limits, since the BN 95-3D was
completed, the BN 95-1XD well has been shut in.
The Company's field production was reduced in July to around
4,000 BOPD due to lack of storage during the recent pipeline
downtime. Subsequently, the Company was able to complete the first
sale through the northern oil pipeline, a batch of 200,000 BO,
allowing the Company to ramp production back to current levels.
With recent drilling the success of the and the operational
knowledge of the field engineers, the Company is confident it can
reach the projected goal of 5,000 BOPD for this fiscal third
quarter.
Also, the Company drilled a new water disposal well, the BN-2W,
on the flanks of the field, which was placed into operation
following the injectivity test. This well was required prior to
re-completing the existing water disposal well. Injectivity tests
showed capacity of the water disposal well at 40,000 barrels of
water per day.
Additional facilities to grow oil production volumes to 10,000
BOPD by year-end are still on track, and the commissioning of those
facilities is expected to begin in December 2019.
Manolo Zuniga, President and Chief Executive Officer,
stated:
"The Company continues to meet targets and execute at a high
level. The success of our development program has us at the upper
limits of our facilities in the field, and our team is committed to
optimizing production operations to assure we meet our targets. We
continue to experience excellent results from the development
program and that should give confidence to stakeholders that the
team we have has the knowledge and experience to operate fields
like Bretana.
Our successful capital raise has given us the confidence that we
can accelerate the production ramp to 10,000 BOPD by year end,
months ahead of our original plan. We have already started the
procurement process to add facilities in mid-2020 to allow for
another step increase in production capacity to 12,000-14,000 BOPD.
We have consistently demonstrated capital discipline, and we
continue to find ways to optimize field operations to unlock the
value to our stakeholders."
FINANCIAL HIGHLIGHTS
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.
Six months ended June 30, 2019 2018
---------------------------------------------------- --------- --------
$ thousands except where defined
---------------------------------------------------- --------- --------
Oil revenues (before royalty expense) 12,628 -
Expenses (13,720) (2,944)
Net loss (1,092) (2,944)
Net loss per weighted average Common share - basic
and diluted ($) 0.00 (0.00)
Exploration and evaluation asset expenditures 395 12,939
Property plant and equipment expenditures 34,244 178
Net working capital surplus (deficit) 17,776 42,554
Total assets 145,833 97,363
Total liabilities 45,675 16,864
Shareholders' equity 100,158 80,499
Common Shares outstanding (000's) 672,196 537,741
---------------------------------------------------- --------- --------
ABOUT PETROTAL
PetroTal is a publicly--traded, dual--listed (TSX--V: TAL and
AIM: PTAL) oil and gas development and production company domiciled
in Calgary, Alberta, focused on the development of oil assets in
Peru. PetroTal's development asset is the Bretaña oil field in
Peru's Block 95 where oil production was initiated in June 2018,
six months after acquisition. Additionally, the Company has large
exploration prospects and is engaged in finding a partner to drill
the Osheki prospect in Block 107. The Company's management team has
significant experience in developing and exploring for oil in
Northern Peru and is led by a Board of Directors that is focused on
safely and cost effectively developing the Bretaña oil field. More
information on the Company can be found at
www.PetroTal--Corp.com.
For further information, please contact:
Greg Smith
Executive Vice President and Chief Financial Officer
Gsmith@PetroTal-Corp.com
T: (713) 609-9101
Manolo Zuniga
President and Chief Executive Officer
Mzuniga@PetroTal-Corp.com
T : (713) 609-9101
http://www.petrotal-corp.com
Mark Antelme / Jimmy Lea
Celicourt Communications
petrotal@celicourt.uk
T : 44 20 8434 2754
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
READER ADVISORIES
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. 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 www.sedar.com. The forward-looking statements contained in this
press release are made as of the date hereof and the Company
undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise, unless so required by
applicable securities laws.
OIL AND GAS INFORMATION: References in this press release to
production test rates, initial test production rates, and other
short-term production rates are useful in confirming the presence
of hydrocarbons, however such rates are not determinative of the
rates at which such wells will commence production and decline
thereafter and are not indicative of long term performance or of
ultimate recovery. While encouraging, readers are cautioned not to
place reliance on such rates in calculating the aggregate
production for PetroTal. A pressure transient analysis or well-test
interpretation has not been carried out in respect of all wells.
Accordingly, the Company cautions that the test results should be
considered to be preliminary.
FOFI DISCLOSURE: This press release contains future-oriented
financial information and financial outlook information
(collectively, "FOFI") about PetroTal's prospective results of
operations, production, 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 National Instrument
51--101 - Standards of Disclosure for Oil and Gas Activities.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this press release.
110698827 v2
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END
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