Peru's Largest Oil Producer Posts Record Net Income in Q2

Source: Streetwise Reports   08/25/2022

PetroTal Corp. shares traded 11% higher after the company reported Q2/22 financial results highlighting seven consecutive quarters of production growth and reaffirmed its FY/22 guidance for average production of 15,000 bbl/d.

Peru’s largest crude oil producer PetroTal Corp. (PTALF:OTCQX; TAL:TSX.V; PTAL:AIM) PTAL), today announced its financial and operating results for the second quarter of 2022, which ended June 30, 2022.

The company highlighted that during the latest quarter, it registered its seventh straight quarter of production growth and generated close to US$100M (million) in net operating income. PetroTal stated that during Q2/22, it achieved record levels of oil production, earned record cash flow, and made improvements to its balance sheet due to increases in net cash flow from operations and exited the quarter with a total of US$77 million in cash.

The firm indicated that during Q2/22, it was successful in producing a record production of 14,467 barrels of oil per day (bbl/d) which was 25% above production levels in Q2/21. The company noted that this represents its seventh straight quarter of production growth.

PetroTal mentioned that on August 22, 2022, it made a significant achievement by formally surpassing a milestone of ten million barrels of produced oil within a period of just four years.

The company added that at the end of June 2022, it completed the buildout of well 11H, which after coming online, produced a total of more than 300,000 barrels of oil in the first full month of production. PetroTal advised that it has already recouped its entire capital investment in the well, which is currently averaging production of 9,000 bbl/d.

The firm indicated that approximately 86% of its sales were made via the Brazilian route, and while the Northern Peruvian Oil Pipeline was offline, the remaining 14% was sold directly to the Iquitos Refinery.

PetroTal reported that in Q2/22, it recorded record oil revenue of US$118.4M at an average price of US$89.04/bbl, compared to US$42.8M (US$53.20/bbl) in Q2/21 and US$92.7M (US$66.41/bbl) in Q1/22.

Additionally, the company advised that during Q2/22, it registered record net operating income and EBITDA of US$98.6M and US$93.4M, respectively, which were up significantly over US$29.7M and US$26.4M in Q2/21.

The firm advised that net income in Q2/22 increased by 31% sequentially to U$$84.2M, compared to US$64.5M in Q1/22, and was substantially higher than the $11.4M it earned in Q2/21.

PetroTal commented that it is reiterating its FY/22 average production guidance of 15,000-16,000 bbl/d but noted that it expects production will fall near the lower range of the estimates.

The company added that for FY/22, it expects EBITDA of about US$342M and associated free cash flow of around US$231M, prior to working capital and debt service obligations.

PetroTal Corp.’s President and CEO Manuel Pablo Zuniga-Pflucker remarked, “Though we have experienced recent production constraints from short-term sales bottlenecks, unconstrained production run rates are over 20,000 bbl/d which we successfully tested in our facilities. The outlook for PetroTal’s low sulfur oil remains incredibly robust with recent strong export demand realized…I would like to congratulate the entire PetroTal team on our recent milestone of ten million barrels produced in only four short years since the first production.”

PetroTal is an oil and gas development and production firm headquartered in Calgary, Alta, Canada. The company is primarily focused on developing oil assets in Peru where it holds a 100% working interest in the Bretana oil field in the Marañón Basin of northern Peru within Peru’s Block 95. The company advised that in 2020 it became the largest crude oil producer in Peru.

PetroTal started the day with a market cap of around US$426.8 million, with approximately 851.9 million shares outstanding. PTALF shares opened 4.5% higher today at US$0.5230 (+US$0.0227, +4.54%) over yesterday’s US$0.5003 closing price. The stock traded today between US$0.5230 and US$0.5671 per share and closed for trading at US$0.5551 (+US$0.0548, +10.94%).

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