PetroTal Announces Significant Increases in 2022 Year-End Oil Reserves

46% increase in 2P reserves value per share to USD$1.75 (CAD$2.29) (GBP1.39)
2P estimated ultimate recovery now over 108 million barrels
Strong 1P and 2P reserves replacement ratios of 179% and 418%, respectively
24% increase in 2P reserves to 96.7 million barrels
21% increase in 1P Reserves to 45.4 million barrels
Added 7 2P well locations, a 32% increase, extending the 2P reserve life to 22 years
2P after tax NPV-10 value increased 48% since year end 2021 to more than $1.5 billion

Calgary, Alberta and Houston, Texas–(Newsfile Corp. – February 1, 2023) – PetroTal Corp. (TSXV: TAL) (AIM: PTAL) (OTCQX: PTALF) (“PetroTal” or the “Company“) is pleased to announce the results of its 2022 year-end reserve evaluation (“NSAI Report”) by Netherland, Sewell & Associates, Inc. (“NSAI”) for the Bretana oil field, operated 100% by PetroTal. All currency amounts are in United States dollars (unless otherwise stated) and comparisons refer to December 31, 2021.

Highlights:

• Increases to Net Present Value (discounted at 10% (“NPV-10”)) after tax, per share values to US$0.90/share (CAD$1.23/share), US$1.75/share (CAD$2.29/share), and US$2.86/share (CAD$3.47/share) for 1P, 2P, and 3P categories, respectively;

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• 2022 Proved Developed Producing (“PDP”) reserves increased 49% to 24.1 million barrels, representing 53% of 1P reserves, reflecting an attractive ratio of base production to low risk drilling proved undeveloped (“PUD”) targets; and,

Manuel Pablo Zuniga-Pflucker, President and Chief Executive Officer, commented:

“Bretana’s reserves have grown tremendously since 2017. Our drilling success combined with the field’s strong natural aquifer support that allow for recovery factors beyond 30% has underpinned a world class oil operation that is expected to deliver immense free cash flow for the next 20 years. The field’s initial 2017 2P estimated ultimate recovery was 37.5 million barrels which we have now almost tripled to 108.2 million barrels. The PetroTal team is committed to increasing value for all stakeholders from the oil field’s ultimate oil recovery enhancement. Noteworthy that our PDP after tax NPV-10 valuation is similar to our current market capitalization. We see significant upside with respect to PUD, Probable, and Possible reserve values that are not reflected in our current market valuation.”

2022 Year-End Reserves Summary

The summary below sets forth PetroTal’s reserves as at December 31, 2022, as presented in the reserves report prepared by NSAI, an independent qualified reserves evaluator. The figures in the following tables have been prepared in accordance with the standards contained in the most recent publication of the Canadian Oil and Gas Evaluation Handbook (the “COGEH”) and the reserve definitions contained in National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (“NI 51-101”). In addition to the summary information disclosed in this announcement, more detailed information will be included in PetroTal’s annual information form for the year ended December 31, 2022 (the “AIF”) to be filed on SEDAR (www.sedar.com) and posted on PetroTal’s website (www.petrotal-corp.com) in March 2023.

Six Year Crude Oil Price Forecast – NSAI Report

The oil price projections used by NSAI are based upon an average of December 31, 2022 and 2021 forecasts of Brent Crude futures prices prepared by three qualified reserves evaluators: GLJ Petroleum Consultants Ltd., McDaniel & Associates Consultants Ltd. and Sproule Associates Limited. The six year average for the NSAI Report reflects an average Brent oil price of $82.79, which as at the time of this press release, is approximately $4/bbl lower than current market Brent prices.

Year-End Crude Oil Reserves (million barrels)

Represents gross and net barrels since PetroTal has a 100% working interest and a 100% net revenue interest in these properties. Royalties are paid from sales proceeds.

Year-End Net Present Value at 10% – Before Tax ($ millions)

Year-End Net Present Value at 10% – After Tax ($ millions)