Calgary, Alberta and Houston, Texas--(Newsfile Corp. - August 21, 2019) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) ("PetroTal" or the "Company") is pleased to provide an update in respect of its operations and production at the Bretaña field in Block 95 (PetroTal: 100% Working Interest) in Peru.
- Company has successfully completed the BN 95-2WD well (the "2WD")
- Following completion of the 2WD, the Company successfully converted the existing water disposal well ("BN 95-1W") into an oil producer, renamed the BN 95-1
- BN 95-1 initial production rate of 2,700 barrels of oil per day ("BOPD") exceeds management expectations
- Current production approximates 5,500 BOPD
- Total field production in August has averaged approximately 5,000 BOPD as expected
- Company spud the BN 95-4 well, a development oil well planned with a horizontal completion
PetroTal has completed a new water disposal well, BN 95-2WD, and proved injection capacity, thus allowing the Company to recomplete BN 95-1W and make it an oil producer, BN 95-1. Management expected the BN 95-1 to deliver initial uplift of 1,500-2,000 BOPD. The initial production rate over the first seven days was 2,700 BOPD. Management plans to provide more information on the BN 95-1 well at the end of August. The Company has spud the BN 95-4 well, intended to be a horizontal completion into the Vivian formation. The BN 95-4 well is expected to take 60 days to drill and complete, with a 500-meter lateral completion scheduled.
Total Bretaña field production is currently at 5,500 BOPD, with the BN 1XD still shut-in, allowing us to reach an August average production of 5,000 BOPD as expected. The central processing facilities to increase Bretaña's total oil field production, expected to be commissioned in December, should bring total field production up to 10,000 BOPD by year-end with the successful drilling and completion of two additional oil development wells, the BN 95-4 and BN 95-5.
Manolo Zuniga, President and Chief Executive Officer, commented:
"Continued execution at Bretaña and stable production above 5,000 BOPD should give confidence to all stakeholders in our ability to unlock value. The water disposal injectivity test rate of approximately 40,000 barrels of water per day shows just how permeable the Vivian formation is. It also allows us to optimize our capital budget and push our next water disposal well to next year, allowing us to focus on oil producing wells in next year's capital budget. The operations team continue to do an outstanding job.
The re-completion of BN 95-1W into an oil producer, at a capital cost of approximately $2.3 million, provides a payout in less than 30 days and is an excellent example of capital efficiency. With current production of 5,500 BOPD, we expect to meet our quarterly target of 5,000 BOPD for the third quarter. We have spud the BN 95-4 well and we are hopeful that this scheduled horizontal completion, with new technology to keep water cuts at lower levels during the initial months, will add to the existing production base, as well as provide valuable information to evaluate reserves at year-end 2019."
For further information, please contact:
Executive Vice President and Chief Financial Officer
T: (713) 609-9101
Manolo Zuniga Mark Antelme / Jimmy Lea James Spinney / Ritchie Balmer / Eric Allan Jonathan Wright / Hugh R. Sanderson
President and Chief Executive Officer
T: (713) 609-9101
Celicourt Communications (Financial PR)
T: 44 (0) 208 434 2643
Strand Hanson Limited (Nominated & Financial Adviser)
T: 44 (0) 207 409 3494
John Prior / Emily Morris / George Price
Numis Securities Limited (Joint Broker)
T: +44 (0) 207 260 1000
GMP FirstEnergy (Joint Broker)
T: +44 (0) 20 7448 0200
Mark Antelme / Jimmy Lea
James Spinney / Ritchie Balmer / Eric Allan
Jonathan Wright / Hugh R. Sanderson
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: PetroTal's business strategy, objectives, strength and focus; drilling and completion activities of oil producing and water disposal wells and the results and timing of such activities; commissioning of capital processing facilities; expectations regarding total field production capacity; the ability of the Company to achieve drilling success consistent with management's expectations; capital budget expectations; anticipated future production; production targets; payout expectations; water cut levels; and 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, 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 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 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 annual information form for the year ended December 31, 2018 and management's discussion and analysis for the three months ended March 31, 2019 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 initial 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, capital budget, growth 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. All FOFI contained in this press release complies with the requirements of Canadian securities legislation, including Canadian Securities Administrators' 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.
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