PetroTal forecasts higher growth, lower capital spending in 2025
By Josh White
Date: Thursday 16 Jan 2025
(Sharecast News) - PetroTal issued its 2025 guidance on Thursday, forecasting significant production growth alongside reduced capital spending.
The AIM-traded company said it anticipated average daily production of between 21,000 and 23,000 barrels of oil per day, representing a 24% increase from 2024's average of 17,733 daily barrels.
Its approved capital budget for 2025 was $140m, down 14% from the prior year, with key investments allocated to four development wells, field infrastructure upgrades, and erosion control measures.
The board said the investments were expected to support production growth and operational stability, with EBITDA projected at $240m to $250m, assuming an average Brent oil price of $75 per barrel.
PetroTal said its budget included $55m for drilling activities, with four development wells planned across the Bretana and Los Angeles fields.
Infrastructure improvements, including the expansion of fluid handling capacity to 32,000 barrels of oil per day at the Bretana central processing facility, accounted for $60m.
An additional $36.5m would be allocated to erosion control measures, a significant portion of which would be expensed as operating costs.
Production growth was supported by flush output from wells 22H and 23H, with guidance assuming stable river levels similar to 2023.
PetroTal said it expected 10% to 15% of crude oil to be sold to the Iquitos Refinery, with the remainder exported via Brazil.
The company committed to maintaining its quarterly dividend of 1.5 cents per share, requiring $55m in funding annually.
It said it would continue its share buyback programme, and consider dividend top-ups quarterly, depending on financial performance.
The firm said it had allocated $4m for exploration, focussing on permitting and road construction at Block 107 and early-stage activities at TEA Blocks XCVII and XCVIII, adjacent to Block 131.
Exploration at Block 95 was meanwhile under review, with the potential for slim-hole drilling to de-risk prospects more cost-effectively.
PetroTal said it was also planning to invest $35m to $40m in erosion control in 2025, part of a broader $65m to $75m project through 2026.
It said the measures were designed to safeguard the Bretana field's long-term production capabilities and community benefits.
"PetroTal is well positioned to build on the operational momentum that we established in 2024," said president and chief executive officer Manuel Pablo Zuniga-Pflucker.
"We are firmly committed to a consistent return of capital policy, while maximizing the value of the Bretana oil field.
"We are one of very few companies in the oil and gas sector that can support a stable dividend while growing output by more than 20% year after year."
Zuniga-Pflucker noted that in addition to its active development programmes at both the Bretana and Los Angeles fields, PetroTal was also expanding its exploration activities in the Ucayali Basin, where it recently secured an extension to the Block 107 licence contract, and signed two new TEA's adjacent to Block 131.
"Lastly, our budget also includes erosion protection measures for our key producing asset, a project that should be completed by the second quarter of 2026."
"The PetroTal team has set ambitious goals for 2025, and we look forward to delivering for investors over the next twelve months."
At 1358 GMT, shares in PetroTal Corporation were up 1.26% at 40p.
Reporting by Josh White for Sharecast.com.
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