RE:RE:Petrotal Shares on Sale for Big Discount!I found the article, here is the TAL reference:
PetroTal Corp
PetroTal has announced the results of its 2020 year-end reserve evaluation by Netherland, Sewell & Associates, for the Bretaa oil field, operated 100% by PetroTal. (All currency amounts are in United States dollars and comparisons refer to December 31, 2019).
Proved 1P reserves increased by 4% to 22.3 million barrels from 21.5 mmbbl, Proved plus Probable 2P reserves increased by 7% to 51.0 mmbbl from 47.7 mmbbl and Proved plus Probable and Possible 3P reserves increased by 25% to 106.1 mmbbl from 84.8 mmbbl.
Relative to 2020 oil production of 2.1 mmbbl, reserve replacement was 38% in 1P reserves and 157% in 2P reserves; Bretaa’s reserve life index (“RLI”) for 1P and 2P reserves is now 6.4 years and 14.6 years, respectively. Original oil in place (“OOIP”) estimates for 1P, 2P, and 3P reserve categories were unchanged from 2019 at 235, 364, and 579 mmbbls, respectively.
NSAI attributes a corresponding 2P recovery factor of 15.0%, increased from 13.6% at year-end 2019 due to performance of the existing wells. Also, a 19% decrease in total 2P operating costs resulting in an undiscounted saving of $232 million driven by further calibration and optimization to the Company’s actual cost structure. This gives an NPV of $317 million ($14.21/bbl) for 1P reserves, $830 million ($16.27/bbl) for 2P reserves.
The 2021 development program combined with all future development and abandonment costs, represent total finding and development costs of $11.52/bbl for 1P reserves, $4.96/bbl for 2P reserves and $3.16/bbl for 3P reserves. On a 2P basis, this represents a recycle ratio of 4.7 times, based on the total $4.96/bbl finding and development cost relative to a netback of $23.40/bbl (assumed at $50.00/bbl Brent oil price).
Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:
Considering the challenging conditions 2020 presented, we are extremely happy with the 2020-year end reserve report. The recovery factor improvements in our 2P and 3P categories support our thesis of continued reservoir performance over time matching that of nearby analogous fields with higher recovery factors. With additional time and field data, we expect to see continual recovery improvements. We are also very proud of the hard working operations and commercial teams at PetroTal which were able to demonstrate and justify to our reserve evaluators, a decrease in 2P operating costs by 19%, equating to $232 million, in undiscounted savings over the remaining reserve life. We will continue to run operations prudently with attention to optimization, cost reductions and safety for the benefit of all our stakeholders.
I think that these 2020 numbers, which are net of the years production, show that there was a very decent, effective upwards revision of 2P reserves compared to last time. Indeed, NSI were encouraged enough by the well decline numbers and whilst the first months of this year don’t give enough evidence to give a substantial raise, come the half year it was likely to justify a more weighty raise in reserves.
Interestingly the recoverable reserves have increased by 10m+ since listing ( including production ) which is easy to be blas about but is 10,000 bopd for 3 years, a somewhat better way of showing the success rate. With a fair wind and further operational success which I expect, PTAL can be relied upon to be able to deliver the scheduled increase in production at a most profitable rate and make the shares very cheap indeed.