(Sharecast News) - PetroTal said in an operational update on Thursday that, following the re-establishment of barging fleet schedules, it had been producing an average of 20,000 barrels of oil per day since the last week of February.
The AIM-traded firm added that production was, however, constrained earlier, resulting in average production of around 7,600 barrels per day and 8,000 barrels per day in January and February, respectively.
At present rates, the company said it expected an average of 11,000 to 12,000 barrels per day during the first quarter, below its 13,500 barrels per day guidance for the period.
It said that with barging travel now normalised and an expanded contracted barging fleet of more than 1.5 million barrels of capacity, up from 1.2 million barrels in 2022, it was expecting to make up the first quarter production shortfall in the second quarter, maintaining its full-year production guidance of between 14,000 and 15,000 barrels of oil per day.
PetroTal had meanwhile completed drilling and coring its third water disposal well on 29 January.
The core sample taken from the well was currently being analysed, with the well completed ahead of schedule and on budget.
PetroTal said it subsequently started drilling development well 14H on 8 February - its 15th oil well at Bretana.
The well was estimated to cost $15.3m, and would be drilled to a total measured depth of almost 5,100 metres, with a 1,125-metre horizontal section, making it the longest-reaching horizontal well ever drilled on land in Peru.
It said the well was expected to be completed by mid-April, with associated production capacity available shortly after initial testing.
That, the board said, would allow the field to continue producing at around 20,000 barrels per day during the second quarter.
On the financial front, PetroTal said it had received $26.5m in regular monthly scheduled payments from Petroperu as at 1 March, totaling around 40% of the $64m true-up revenue due to the company from 2022.
In 2023, the company had also received $4.5m from the exercise of warrants, further enhancing its cash position.
The firm reiterated its first quarter cash flow guidance, allowing the remaining $55m of bonds to be repaid by the end of March, in addition to the $25m paid in mid-February.
It said the full bond repayment would allow for a capital return program to start shortly afterwards.
To support working capital fluctuations, PetroTal added that it had finalised an unsecured revolving $20m credit facility with a Peruvian bank.
"We are pleased that barge loadings and deliveries have been restored and normalised to allow steady and continuing sales flow," said president and chief executive officer Manuel Pablo Zuniga-Pflucker.
"The team is confident the company will be able to catch up with guidance in the second quarter, should current export conditions continue, creating the platform not only to meet, but also surpass, current 2023 guidance."
Zuniga-Pflucker said the field was now producing more than 20,000 barrels per day, which recently propelled the company to reach over 12 million barrels of cumulative oil production and represented 11% of the field's estimated ultimate 2P recovery.
"We are also extremely happy that we will fulfil our promise to investors to repay the remaining bonds and prepare for a much anticipated return of capital programme."
At 1245 GMT, shares in PetroTal Corporation were up 3.27% at 42.34p.
Reporting by Josh White for Sharecast.com.
PetroTal (PTAL)