PetroTal today provides the following update on operations in Peru:

Achieved 20,000 bopd Production Level

PetroTal has achieved a trailing 5-day unconstrained production rate ending December 15, 2021, of approximately 20,200 barrels of oil per day (“bopd”). With wells 8H and 9H producing over 6,300 bopd and 8,200 bopd respectively, PetroTal was able to achieve its long-standing goal of exceeding 20,000 bopd much earlier than anticipated and previously guided. PetroTal has reached this milestone only four years after commencing operations at the Bretana oil field in early 2018, an indication of operational excellence, perseverance and teamwork.

Robust Production from Well 9H

Well 9H is delivering a strong initial production profile having averaged approximately 8,200 bopd over the last 10 days, and trending very close to the performance of well 8H.

Well 10H Commences Drilling

PetroTal commenced drilling well 10H on December 11, 2021. This long-reach horizontal well is similarly located to well 9H and is estimated to cost $13.9 million with a targeted completion date in early February 2022.

Settlement Framework Reached at Pump Station 5

PetroTal advises that a joint framework was reached between the communities, Ministry of Energy and Mines, and Petroperu, that demonstrates trust and a commitment to ongoing dialogue, which has resulted in the expected return of Pump Station 5 back to Petroperu on December 16, 2021, as a gesture of goodwill toward longer term solutions. Once Petroperu restarts operations at Pump Station 5, it will take approximately one week to complete the required inspections needed to fully recommence oil throughput in the Northern Peruvian Pipeline (“ONP”). Based on this forecast, it is still likely PetroTal will have to constrain production after December 16, 2021, for up to two weeks, to manage storage capacity, at which time it expects to go back to levels near 20,000 bopd.

Brazilian Export Update

In November and December, PetroTal will export nearly 320,000 barrels of oil through the Brazil sales route. Commencing in January 2022, estimated Brazilian oil exports will be approximately 240,000 barrels monthly and expected to increase further in Q2 2022.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:
“We are very pleased at the progress made at Pump Station 5 and the demonstration of trust and goodwill shown by the communities. This, together with the initiatives PetroTal is pursuing, is expected to lead to long term stability for the region at a critical time for the new Talara refinery that is expected to start operation in 2022, Peruvian producers, the local communities, and Petroperu. I would also like to thank our team for their dedication and perseverance over the past four years enabling PetroTal to achieve our original 20,000 bopd goal. I am humbled by the expertise and drive our team continues to demonstrate through unprecedented operating conditions. Additionally, I’d like to thank our shareholders for their ongoing support, patience and confidence as we continue development of the prolific Bretana oil field.”

PetroTal in Peru

Bretaña: Large Undeveloped Oil Field

Large oil field with recent first production

• 3D seismic acquired in 2014
• Five wells define structure and continuity of reservoir
• 100% oil production with nominal gas
• First production initiated in June 2018 on time and under budget
• Capex of $18.5 million to first oil  – 25% under original budget

Development Plan in place

• Enhanced production from first well to 2,000 bopd in November following installation of oil well pump and water treatment and reinjection facilities
• Full development targeting plateau >20,000 bopd in 2022
• Infrastructure and export routes in place – established barging and pipeline route to tide-water market

Exploration upside on trend

• Additional development drilling should define Bretaña 2P recovery factor from 15% to management’s expected ~20%
• 5 exploration prospects / leads on trend with Bretaña

Block 107 – Osheki Prospect

Potential Resource

• Osheki Structure is a sub-thrust play similar to Cusiana complex in the Llanos Foothills of Colombia
• Mean Estimate Unrisked prospective resources of 534 MMBO
• 2-D seismic completed with drilling permits approved
• De-risked with new 3D Geologic Model supporting Cretaceous reservoirs with oil charge from high quality Permian source rocks

Exploration Strategy

• Farm out process commenced in 2022
• Targeting first exploration well in 2022

KeyFacts Energy: PetroTal Peru country profile