PetroTal upbeat on strong third quarter
By Josh White
Date: Thursday 14 Nov 2024
(Sharecast News) - PetroTal reported a strong set of financial and operational results for the third quarter on Thursday, with production and sales of 15,203 barrels of oil per day and 14,760 daily barrels, respectively.
The AIM-traded firm said that marked a 39% increase from the third quarter 2023, despite challenging conditions with low river levels affecting its primary export route.
It generated $47.5m in EBITDA, equivalent to $35 per barrel, and ended the quarter with $133m in total cash, of which $121m was unrestricted.
Capital spend for the quarter totalled $43m, primarily focussed on drilling new wells, including the successful 20H production well, which had averaged 4,209 barrels of oil per day over the last two weeks.
PetroTal also tested a lateral extension into the Upper Vivian sandstone in the 20H well, which yielded 320 barrels of oil per day during testing, potentially contributing to reserve growth by year-end 2024.
Net income for the third quarter reached $7.2m, marking the 19th consecutive profitable quarter.
PetroTal's net surplus, however, declined to $10.1m from $50.3m in the prior quarter, primarily due to reduced oil prices affecting an unrealised derivative liability and adjustments related to its capital programme.
In line with its commitment to shareholder returns, PetroTal declared a 1.5 cent per share dividend, payable on 13 December.
The company also repurchased one million shares in the quarter, amounting to a total shareholder return of about $14.3m, or 3.5% of its market capitalisation as of 30 September.
"The third quarter is typically the most challenging period of the year for PetroTal, due to seasonal declines in river levels which impact our ability to export crude oil from the Bretaña field," said president and chief executive officer Manuel Pablo Zuniga-Pflucker.
"With that in mind, I am proud of the results our team has delivered this quarter.
"Although production declined relative to the prior quarter, we increased output by 39% compared to the same period last year and our year-to-date production is now tracking 23% higher than the first nine months of 2023, all while the company is building cash and returning more than $51m to shareholders through dividends and buybacks."
Zuniga-Pflucker said that looking ahead to 2025, PetroTal was well prepared to handle a period of lower oil prices, adding that it had no debt and a stable, high-margin production base.
"As planned, our drilling program at Bretaña is pausing in the first quarter 2025, while we import a new, modern drilling rig to Peru.
"The new drilling rig is expected to drive material cost savings, while allowing us to control the pace of development, giving us a higher degree of flexibility to respond to changes in oil pricing as necessary.
"We look forward to providing detailed guidance on our 2025 budget and operational program in January."
At 1438 GMT, shares in PetroTal Corporation were up 1.37% at 37p.
Reporting by Josh White for Sharecast.com.
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