Member Info for Somekindofnut

The average production for this year won't be great but they are only a few months from a return to drilling, In January, they said October 1st at latest. New wells typically gush at several thousand bpd. Second drill to start in Q4 and form part of 8 well program for next year. And additional water handling that they say will be sufficient to bring on the 5k bpd currently offline.

So all being well, PTAL end of year should see 20k+ bpd with even more next year.

I doubt dividend will be back that soon. I think the priority will be getting production back up above 20k. With more cash, I don't think they can move the start of drilling sooner as that'll be contracted, but they can perhaps fit an extra drill in this year?

They also say that 5k of production is shut in because of limited water handling capacity (January webcast Q&A). Fresh wells need less water handling, so they could maybe bring wells on that require more water handling when drilling restarts. I believe they are adding some water handling this year, but maybe they could accelerate this with the increased revenue too.

Alternatively, $90 oil could be the new normal. Iran only needs fishing boats to lay mines in Hormuz strait and be a nuisance to shipping for months or years. And Permian field which has long been the main source of Shale growth is having it's own water handling problems. I don't think the end of high oil prices is entirely in Trumps hands anyway.

I notice Petrotal's December production is up on November, but my guess is they still haven't brought all wells back on line because oil prices are low. And I think the only news expected in January is the development plan for the Los Angeles field. I think because their lower activity is known, as is the bearishness around oil price, it's probably already reflected in the share price.

However, IEA is saying there is an oil glut, but Opec doesn't believe in oil glut:

https://www.reuters.com/business/energy/opec-says-opec-raised-output-november-leaves-demand-view-steady-2025-12-11

https://x.com/i/status/2000427210616762476

IEA demand growth forecast for this year is 830kb. But October 2024 -October 2025 demand growth was 2.4m barrels. That's higher than Opec forecast too.

https://x.com/i/status/2001723278730379703

So IEA are underestimating demand yet again this year. I think that'll be 19th year in a row?

There's also risks to supply. Low prices usually push supply down. Haven't seen effect of falling rig count yet. Etc

Christine Guerrero says if demand grows by 1.3m barrels next year, shortages should emerge. When as I said, this year, October to October, demand grew by 2.4m barrels.

https://x.com/SheDrills/status/2003128745952264409

Analysts, IEA and Opec are all obviously biased of course. However, I don't think that matters so much who is right or wrong or what happens with geopolitics- as long as Opec are prepared to react and cut if they are wrong. And already Opec have said they are pausing planned increases in production.

Anyway, $80 oil isn't on immediate horizon unless there's some crisis.

I follow #oott for oil news.

Charlie, production is obviously going to be lower with shut-in wells. So last update says production will increase in November and December as these wells are opened again.

"Bretana field production is expected to ramp up throughout the months of November and December as the shut-in wells are returned to production."

I think they've shut down more wells, as they said they'd:

"proactively replace electric submersible pumps in several wells, as a preventative measure to mitigate against potential future downtime. "

River levels are good, but they wouldn't know that in advance. October isn't normally good for river levels.

So they didn't say things would ramp up in October, but that:

"Bretana field production is expected to ramp up throughout the months of November and December as the shut-in wells are returned to production."

In the update, I think Petrotal was still hopeful of rig arriving this year at 131 and so starting drilling before year end. But Camillio seemed quite definite in more recent PetroTal Twitter video that it'd be next year that they return to drilling.

Main thing is though that they get the infrastructure upgrades done this year so they'll be ready.

Update says:

"During the second quarter, PetroTal completed the installation of the CPF-4 processing facility, increasing nominal oil treatment capacity at Bretana to 26,000 bopd, which has been established as a more optimum design for the Company's current output than the previously mentioned 32,000 bopd. Oil production remains constrained by water treatment capacity, which currently stands at just over 170,000 barrels of water per day("bwpd"). The remaining 2025 Bretana capital program is largely allocated to field infrastructure, including completion of the L2 platform, which will be required to accommodate additional development wells beginning in 2026."

So next year, capex should be on drilling (increasing production) rather than field development (capacity). And they have their own rig so payback should be even quicker.

But as I understand it, there will be some delay getting to drilling Bretana while we wait for rig to finish at 131. So just one well at 131 could take productio to 5,500 bpd field capacity, but they'll drill more wells while the rig is there. You don't want to be moving the rig back and forth all the time. Horizontal drilling might not be great benefit at 131 I suppose, but having ability to drill at an angle can't be a bad thing.

So 12 months from now, production maybe not hitting capacity, but could be 24k bopd at Bretana and 5k bopd at Los Angeles?? Too optimistic?? Seem plausible to me.

Anyway, they are still making good progress I think.

Reuters says Petroperu is in direct talks with five firms, including PetroTal, as it seeks a partner to reactivate lot 192.

Says it expects to select an operator for Lot 192 in about 2 weeks.

Petroperu expects the block to produce up to 12,000 barrels per day (bpd) within six months of restarting. That output could rise to around 21,000 bpd after the new operator completes a drilling program.

The article also confirms Petroperu is in separate talks with PetroTal to transport crude through the Northern Peruvian Pipeline.

https://www.reuters.com/sustainability/climate-energy/petroperu-accelerates-talks-amazon-oil-block-partner-2025-06-27/

Number of shares:

Today:914,885,624

June last year :914,195,730

So only 689,894 difference. Less than 0.1%.

The number of shares is actually pretty stable. Comparing June to December isn't comparing like with like because shares are issued in Q1. Comparing to before COVID isn't useful either, as they issued warrants to cope with pandemic lockdown which weren't fully converted to shares until 2023.

However, if you compare number of shares now, to June a year ago, the difference is less than 1%.

So what's happening then is buy backs mostly offset shares issued. I think that's a good thing, not a waste.

Most of the shares issued go to Manolo for performance. I think Manolo holds about 2% of Petrotal, and that'll grow, but considering he's not just the CEO, he's a founder, I don't think it's too much. If I founded an oil company, I'd want a lot more shares and I wouldn't expect to have to wait years for them. Lol. Petrotal is a team, but you can largely attribute the Petrotal strategy to Manolo. He recognised that the company needs to work directly with the locals and that's why IMO it has been a success where so many other oil companies over the decades have failed in Peru. I wouldn't like him headhunted by another outfit. At this stage Petrotal could continue to grow without Manolo, but in terms of growth beyond Bretana, I think Manolo has unique influence in Peru.

Also, it's the law in Peru that employees must share in profits. Applies to any employer with more than 20 employees. I think it's a good thing if employees are choosing to take their profit-share as shares as like Manolo they need to wait 3 years for them to vest; so it's an incentive to stay with the company.

However, I do prefer dividends as like most UK investors I have shares in a tax wrapper and I don't believe AIM is efficient at valuation; so less shares doesn't necessarily result in a higher share price.

IMO share price slump since last May can largely be attributed to outlook for cash available for dividends. The loan for erosion project fixes this somewhat, I think we just need higher oil price and/or higher production too to get us back to May 2024 levels (50p +).

Rylidan, its their fault for their names. Too many Blue Harbours! No imagination.

I think you are confusing Blue Harbor Capital Advisors of Texas,which as you say is Mergers and Aquisition firm.

With Blue Harbour Capital Fund of Hong Kong. Which I think Askar Alshinbayev still controls. Different spelling of Harbour/Harbor.

Alshinbayev previously held more than 20%, so I assume there's no mandatory bid requirement at 20% in Canada even though google suggests it's 20%. Curious though that BH chose to own just under 20% (19.9%) for 18 months and have now popped above 20%.

Anyway, maybe Blue Harbour are buying now because they know Encompass are finally out? Im pretty sure share price wouldn't be so deflated if it wasn't for Encompass selling. March 2024, Encompass owned 7% of Petrotal. 65 million shares. Also last year, Encompass moved into FREYR (giga batteries), so I suggest were pivoting from oil into renewables. Anyway, PTAL used to detail holders on presentation, so you can see holdings on page 26:

https://petrotalcorp.com/wp-content/uploads/2024/03/PetroTal-IP-March-2024.pdf

Anyway interesting to see if Blue Harbour keep buying.

I think webcast address in today's RNS is incorrect. I believe it should be as given in April RNS where they first announced it:

https://stream.brrmedia.co.uk/broadcast/67ecfc37a8f35502beb474b8

Lol. I got censored!

i can't say whether barge companies are well run, but they aren't amateurs. licensed companies run the barges and peru is actually rather bureaucratic and protective.

and there's no bridges over the amazon because it's so sp****ly populated, which means few roads so barges do a critical job. without the barges moving around the amazon, towns like iquitos just wouldn't be viable so plenty for them to do, so i'm sure they'll be ok.

Trump is hiking tariffs on China to 125%, authorizes a 90 day tariff pause on everyone else.

Oil rebounding.

Im sorry but I think your range is out of date. The Fed survey of companies I linked to was taken last month. They do it every quarter.

Biggest issue in election was possibly inflation because its been a problem.

I had look at US Bureau of Statistics inflation calculator.

https://www.bls.gov/data/inflation_calculator.htm

It says $52 worth of goods (or buying power) in 2019 is same as $65 in 2025. That fits exactly with the Fed surveys saying average break even for shale has risen from $52 to $65 in the same period.

Things have changed a lot in shale patch since Trumps first term. The majors are in control, they won't drill at a loss and cheap debt has gone.

Break even is now averaging $65 according to shale companies:

https://x.com/DallasFed/status/1904905536874684581?t=eb0DHJeJQSL-aKWfwbACFQ&s=19

The same survey 6 years ago had break even at $52.

https://x.com/JRJ_ALHAJRI/status/1114611694720782336?t=TTiCxicXBpDy_4WHmIpc8w&s=19

Worth reading the comments of the shale companies too.

https://x.com/JavierBlas/status/1904953555502403950?t=J3dT7D2c6rXb37-YKKto5w&s=19

'$70 is the new $50 per barrel'

'steel tariffs have increased costs'

'drill baby drill is a myth'

'key word is uncertainty'

The question on webcast wasn't how much oil would go into the pipeline. What Manolo was asked was-'What the effect of using the pipeline would be on production?'

So Manolo said that we lost about 300,000 barrels over last year due to production restrictions with the dry season. Annualised that's 800-1000 bopd.

So Manolo says "So the answer to the question is that we should expect that once we go to the pipeline during the dry season, we avoid losing those 800-1,000 barrels per day and maybe do better than that."

So what he's saying then, is that the pipeline nullifies the effect of the dry season. That'd be a result! Lol.

Manolo has previously said that he's confident pipeline deal can be done with the new PetroPeru management and that the current guidance doesn't include boost if they use pipeline. Also worth noting that it won't matter so much to Petrotal what happens after they deliver to pipeline. If it's vandalised or the oil is stuck it won't cost because the deal they seek is payment on delivery to pipeline.

However, I think the effect of the pipeline won't just be more production, I think steady production throughout the year would have a major boost to sentiment. The future is always unknown, so sentiment is always important, but having an improving story is especially important on AIM.

RNS also says:

"Production also remains constrained by facility capacity, as the Company awaits the installation of CPF4, which will increase oil handling capacity to 32,000 bopd by mid-year."

So CPF4 unit should improve sentiment and outlook.

Another main boost to sentiment should be the new rig. Why do they wait to be asked about these same things every time? If they produced prepared slides, we wouldn't have to strain to hear and search the audio. They aren't selling the story.

The issue has been that Petrotal generates huge amounts of EBITDA, but as they are committed to invest most of that and pay dividends, that then leaves little "free cash". So they make it sound like they'd struggle with low oil prices because of commitments. Having their own rig changes this. Capex can now be flexible to oil prices and rather more of that EBITDA will be "free".

The market should be reassured that Petrotal can pay dividends in low oil prices as (in addition to being able to be flexible on capex and having cash reserves), they also announced that 40% of their oil is hedged. This too should boost sentiment.

Production guidance for 2025 up by 24%, Capex down 14%. I hope they'll decide to drill more though as they have the flexibility. Especially as production capacity of 32K bopd at Bretana planned.

3pm webcast:

https://brrmedia.news/PTAL_CB25

January presentation:

https://petrotalcorp.com/wp-content/uploads/2025/01/PTAL_CIP_January-2025.pdf

So Petrotal will pause drilling to await the new rig. I think getting their own rig critically changes market perception of their risk - how they can be more flexible with capex and therefore manage cashflow. They can show how they'd sustain cashflow (for dividend etc.) even at much lower oil prices

So in 2024 they indicated that if oil had averaged $60 they'd generate bugger all free cash largely because they'd committed to about $150m of capex (slide 37, December presentation).

I think this resulted in unfair free cash comparisons to other companies who had no free cash because they had not enough income rather than because they were investing.