PetroTal announces that its Board of Directors has decided to suspend the Company's regular quarterly dividend, until further notice.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:
"While PetroTal's financial and operational results remain strong, as evidenced by the Q3 2025 results which we also published today, the Company is facing a number of challenges as we finalize our 2026 budget. Most notably, we continue to experience delays in the resumption of our development drilling program, and as a result our production volumes are expected to decline throughout H1 2026. The updated production forecast, combined with weaker oil prices, is limiting our ability to fund both an adequate development program and return capital to shareholders.

After considering the preliminary 2026 outlook over the past few weeks, PetroTal's Board of Directors has made the difficult decision to suspend our regular quarterly dividend for the time being. As a significant shareholder myself, I would like to assure investors that this decision was not taken lightly; we are evaluating all options to preserve liquidity, as we work to resume our development drilling program as quickly as possible. PetroTal intends to provide more detailed guidance in January 2026, once the development program and associated production forecast are finalized. We thank our shareholders for their ongoing support."

Preliminary 2026 Outlook 

As disclosed with Q2 2025 results on August 7, PetroTal is actively optimizing the long-term Bretana field development plan, to account for a variety of factors including sustained lower oil prices, regulatory considerations, and delays in resuming our development drilling program. At this point, PetroTal believes the best-case timing to resume drilling at Bretana is mid-year 2026. Given that PetroTal does not currently expect to generate any material organic production additions in H1 2026, initial 2026 budget runs suggest corporate production is likely to average approximately 12,000-15,000 bopd next year, depending on the timing of the resumption of development drilling at Bretana. PetroTal continues to refine the 2026 development plan, which remains subject to board approval.

While the long-term outlook for the Bretana field remains strong, supported by eight (8) and sixteen (16) booked 1Pand 2P drilling locations, respectively, along with significant unbooked upside in the VS1 horizon, continued development is contingent on investment in facility expansion, specifically water handling capacity. At prevailing oil prices, and under the updated production forecast, PetroTal believes it will be challenged to fund both development drilling and expansion of water handling capacity internally through cash flow, while returning capital to shareholders. As a result, PetroTal's Board of Directors is prioritizing cash preservation, with the expectation that available cash reserves may be drawn upon to help fund the 2026/27 development program. PetroTal intends to provide formal 2026 guidance by the end of January 2026 and publish its annual reserve report by the end of February 2026.

Dividend Suspension

After giving careful consideration to the 2026 outlook described above, PetroTal's Board of Directors has elected to suspend the regular quarterly dividend until further notice. PetroTal's Board of Directors has a long-standing directive that the Company must maintain a minimum available cash balance of $60 million, as insulation against production interruptions, decreases in commodity prices, or other emergency situations. If PetroTal's Board of Directors has a reasonable expectation that forecast development expenditures may cause available cash to fall below $60 million within the next four quarters, it is obliged to reduce or halt distributions to shareholders.
PetroTal's Board of Directors would like to assure investors that the Company remains committed to returning capital to shareholders whenever appropriate, whether through dividends or share buybacks. Since 2023, PetroTal has returned almost $155 million to shareholders, of which $144 million has been paid out in dividends. The Bretana field has generated more than $400 million of free funds flow since the beginning of 2020. PetroTal's Board of Directors is confident this asset can continue to support a stable return of capital program in the future, albeit at higher production volumes and commodity prices. However, the Company must invest capital in development over the next 12-18 months to support these endeavors.