PetroTal Announces Increases in 2021 Year-End Oil Reserves

Source: 2/15/2022, Location: South America

PetroTal Corp. ("PetroTal") (PTALF) is pleased to announce the results of its 2021 year-end reserve evaluation by Netherland, Sewell & Associates, Inc. ("NSAI") for the Bretana oil field, operated 100% by PetroTal (the "NSAI Report"). All currency amounts are in United States dollars (unless otherwise stated) and comparisons refer to December 31, 2020.


- Significant increases in all reserve categories:
- Proved ("1P") reserves increasing by 68% to 37.4 million barrels. Net Present Value (before tax, discounted at 10% ("NPV-10")) is $724 million ($19.38/bbl) for 1P reserves;
- Proved plus Probable ("2P") reserves increasing by 53% to 78 million barrels. Net Present Value (before tax, discounted at 10% ("NPV-10") is $1.39 billion ($17.82/bbl) for 2P reserves; and,
- Proved plus Probable plus Possible ("3P") reserves increasing by 39% to 147 million barrels.

- NPV-10 values have increased 129% for 1P and 67% for 2P, over year-end 2020, due to reserves growth and an increase in the Brent price forecast used by NSAI at year-end 2021;

- Material progression of after tax NPV-10 per share to US$0.69/share, US$1.23/share, and US$2.00/share for 1P, 2P, and 3P categories;

- 2021 Proved Developed Producing ("PDP") reserves increased 35% to 16.15 million barrels, representing 43% of 1P reserves, reflecting an attractive ratio of base production to low risk drilling targets;

- Three key reserves parameters had material positive upgrades in the NSAI Report, compared to the prior year:
- Original Oil in Place ("OOIP"): Increases of 5%, 7%, and 7% to 247, 389, and 618 million barrels, respectively, for the 1P, 2P and 3P cases;
- Due to continued drilling success and additional subsurface data, 1P, 2P and 3P total booked well counts for 2021 are 17, 22, and 29, respectively, up materially from the 2020 well counts of 11, 15, and 20; and,
- With additional subsurface similarities to Bretana's analogous fields now recognized, all three recovery factor percentages materially increased in 2021 to 18% (from 11%), 22% (from 15%), and 25% (from 19%) for 1P, 2P, and 3P reserve categories, respectively.

- 2P Future Development Capital ("FDC") increased $96 million or 49% to $289 million from 2020 reflecting an additional 7 wells booked at year-end 2021 and the required associated water disposal capacity needed to accommodate higher anticipated flush and run rate production volumes;

- 2021 Finding and Development ("F&D") cost per barrel of $6.63, $4.68 and $3.85 for 1P, 2P, and 3P reserve categories, respectively. The 1P and 2P per barrel costs were reduced 42%, and 6% from year-end 2020;

- Attractive year-end 2021 reserves-based metrics
- Doubling 2021 Reserve Life Index ("RLI") for 1P and 2P reserves, to 13.8 and 28.9 years, respectively, compared to 6.4 and 14.6 years in 2020; and,
- Robust 2021 production reserve replacement ratios of 457% and 816% for 1P and 2P reserves.

- On a 2P per barrel basis, the NSAI Report reflected a 3.5% decrease in operating costs per barrel, which, given the inflationary pressures from higher Brent oil prices and the COVID-19 pandemic, is an important success story for PetroTal; and

- On a 3P basis, the 2021 NSAI production forecast shows a 16-year plateau above 10,000 barrels of oil per day ("bopd) instead of the prior 12-year plateau in NSAI's 2020 reserves report.

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented

"The Bretana field is proving itself to be a prolific investment given the significant achievements in 2021 and the 2021 year-end reserves report results. Based on the increased recovery factors and additional booked drilling locations, we have significantly extended the running room and future development potential of our asset. This should allow Bretana to generate free cash flow for a much longer period of time."

2021 Year-end Reserves Summary

The summary below sets forth PetroTal's reserves as at December 31, 2021, as presented in the reserves report prepared by NSAI, an independent qualified reserves evaluator. The figures in the following tables have been prepared in accordance with the standards contained in the most recent publication of the Canadian Oil and Gas Evaluation Handbook (the "COGEH") and the reserve definitions contained in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101"). In addition to the summary information disclosed in this announcement, more detailed information will be included in PetroTal's annual information form for the year ended December 31, 2021 (the "AIF") to be filed on SEDAR and posted on PetroTal's website ( in April 2022.

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