• Quarterly average production of 14,865 bopd in Q4 2023
• 2023 average production of 14,248 bopd
• December 2023 average production of 20,090 bopd
• Unrestricted cash liquidity of $90 million as at December 31, 2023

PetroTal announces the following operational, financial and corporate updates. All amounts are in US dollars unless stated otherwise.

Q4 2023 Production

PetroTal achieved average production of 14,865 barrels of oil per day (“bopd”) in Q4 2023 and 14,248 bopd for the year 2023. During the month of December, due to improved river levels from the return of the rainy season, production averaged 20,090 bopd, helping meet Q4 2023 and the 2023 production guidance range of 14,000 to 15,000 bopd.

Operational Update

With the installation of the L2 West Platform completed, the Company has successfully drilled its first horizontal well (16H) on the new platform. Well 16H is currently being completed and expected to start production by mid-January 2024. The 16H well should allow the Company to maintain production above 20,000 bopd for the foreseeable future now that the Company, through its trading partner, has enhanced the oil export barge fleet capacity to more than 1.6 million barrels. This, together with reducing the time for discharge operations at the Brazilian offloading site, will mitigate production bottlenecks as experienced during the first quarter of 2023.

Alternative Sales Route Update

The Company is in the process of obtaining the relevant authorization for use of the most suitable port in Ecuador for the export of oil produced from Bretana via the OCP pipeline. With support from the OCP, (Ecuador’s primary transportation company), PetroTal has been working closely with the various Ecuadorian government energy entities that are involved in the authorization processes. Based on the positive support received to date from the OCP and Petroecuador, the Company is confident in its ability to obtain eventual authorization for future recurring sales to the OCP in mid to late 2024.

Cash and Liquidity Update

PetroTal exited Q4 2023 in a strong position with approximately $90 million of unrestricted cash and $21 million of restricted cash for a total of $111 million as at December 31, 2023. Restricted cash includes amounts reserved for the social trust funds to be deposited at a later date. The robust cash position supports future returns of capital to shareholders in the form of regular dividends, special dividends and share buybacks, as approved by the Board. During Q4 2023, the Company purchased 5.1 million shares at an average price of US$0.58/share pursuant to the share buyback program, and paid dividends of $18.4 million (US$0.02/share) on December 15, 2023 related to Q3 2023 operations. Accounts receivable of approximately $70 million are contractually current, with accounts payable of approximately $68 million, primarily due within the next 50 days.

VP Exploration and Development Retirement

Mr. Dewi Jones, VP Exploration and Development will retire from PetroTal on January 18, 2024, having served in this capacity since March 1, 2021. PetroTal appreciates Mr. Jones efforts and guidance over the last three years.

The duties of his position are being reallocated internally, so a replacement is not being considered at this time. Mr. Jose Contreras, Senior Vice President Operations will assume all responsibilities for Bretana’s development. PetroTal is pleased to advise that it has re-engaged Mr. Estuardo Alvarez-Calderon in a consulting capacity to coordinate the exploration aspects. Mr. Alvarez-Calderon was a founding partner of PetroTal and served as PetroTal’s VP Exploration and Development from 2017 until retiring in 2021.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:
“The Company expects to have a strong oil sales profile while river levels are high. With well 16H commencing production in January 2024, the Company hopes to produce over 20,000 bopd for the foreseeable future as we have expanded our export barging fleet to over 1.6 million barrels, and we continue to expand into other sales markets. We are excited to be starting 2024 at this production level and will be announcing our 2024 plans very shortly.

PetroTal remains in a strong financial position with no long-term debt. With $90 million unrestricted cash and $21 million of restricted cash, we will continue with our plans to return capital to investors via dividends and share buybacks for the foreseeable future.

I wish to thank Dewi Jones for his contribution to PetroTal’s successful growth and wish him well in his retirement, and welcome back Estuardo Alvarez-Calderon who will be leading our exploration efforts.”

KeyFacts Energy: PetroTal Peru country profile