PetroTal Provides Operations Update

PetroTal boosts drilling economics at its Los Angeles field through a new lower sliding-scale royalty regime tied to oil prices.

Rhea-AI Summary

PetroTal (PTALF) reports 2026 year-to-date production ahead of budget and secures lower royalties on Peru's Block 131.

Group production averaged 13,181 bopd year-to-date to August 31, about 3% above internal budget, with August output of 11,709 bopd driven mainly by the Bretana field. A pulling campaign at Bretana replaced tubing and electric submersible pumps in five wells and is followed by workovers on two water injectors, ahead of development drilling resuming in October 2026. At the Los Angeles field (Block 131), a new royalty regime cuts rates on qualifying incremental Cushabatay production to a sliding 5%, 9% or 15%, versus the original 23.5%, with about 60% of current volumes eligible, while future deeper Noi and Copacabana output will carry a flat 5% royalty.

Positive

• 13,181 bopd average 2026 YTD production, approximately 3% ahead of internal budget
• August 2026 production of 11,709 bopd, including 11,402 bopd from Bretana and 308 bopd from Los Angeles
• New Block 131 royalty on incremental Cushabatay output reduced to 5%, 9% or 15% versus original 23.5%
• Approximately 60% of Los Angeles field current production qualifies for the new lower royalty regime
• Future production from deeper Noi and Copacabana formations to carry a flat 5% royalty
• Bretana development drilling campaign scheduled to resume in October 2026 with rig already on location

Negative

• PetroTal’s Social Fund contribution at Block 131 increased to 2.5%, modestly raising non-operational outflows
• Company must drill two new wells at Block 131 within two years or all production reverts to 23.5% royalty
• Bretana erosion control construction largely suspended after prior contractor termination, with new contractor selection still in process

News Explained

Lower Block 131 royalties are now executed but depend on PetroTal drilling two wells within two years or reverting to 23.5%.

The September 7, 2026 update reports that PetroTal has executed the Block 131 license amendment, changing the royalty terms for qualifying incremental production while creating a new drilling obligation.

The revised terms apply to production from new wells and workovers, but the company must drill two Block 131 wells within two years; otherwise, royalties on all production revert to 23.5%.

The amendment therefore combines a lower royalty burden with a binding development commitment and a higher local Social Fund contribution of 2.5%, so the release establishes changed economics and obligations without quantifying their net cash effect.

Separately, Bretana erosion-control construction remains largely suspended after the March 2026 contractor termination; the stated path to resumption is completion of the new tender and contractor selection.

AI-generated analysis. How Rhea-AI works. Not financial advice.

See more from StockTitan in Google Search and AI answers. Adds StockTitan as a preferred source · opens Google

Add on Google Not now

Calgary, Alberta and Houston, Texas--(Newsfile Corp. - September 7, 2026) - PetroTal Corp. (TSX: TAL) (AIM: PTAL) (OTCQX: PTALF) ("PetroTal" or the "Company") is pleased to provide the following operational update. All amounts are in US dollars unless stated otherwise.

Key Highlights

• Group production averaged 13,181 barrels of oil per day ("bopd") YTD;

• Bretana development drilling campaign on schedule to resume in October;

• Amendment to the Block 131 License Contract has been executed, whereby royalties on incremental production have been materially reduced.

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

"PetroTal's operations team continues to execute at a high level. Year-to-date production is running approximately 3% ahead of budget, supported by contributions from our recent pulling campaign, which was completed on time, on budget, and without any safety incidents. With the Estrella drilling rig already on location at Bretana, we are well positioned to resume development drilling on schedule and build on this momentum through the balance of 2026."

Q3 2026 Production and Operations Update

PetroTal's group production averaged 11,709 bopd in August 2026, including 11,402 bopd from the Bretana field (Block 95; PetroTal 100% WI) and 308 bopd from the Los Angeles field (Block 131; PetroTal 100% WI). As of August 31, 2026, PetroTal's year-to-date production has averaged 13,181 bopd, approximately 3% ahead of internal budget expectations. PetroTal recently completed a pulling campaign at the Bretana field, where production tubing and electric submersible pumps were replaced in five wells. Remediation work in the wells has improved production deliverability, offsetting natural declines at the field. Following completion of the pump and tubing replacements in the producing wells, PetroTal commenced workovers on two water injection wells, with a view to increasing water injection capacity at the field. The work program is proceeding on time and on budget, ahead of the planned resumption of PetroTal's development drilling program in October 2026. PetroTal will notify the market once the first well in the program has spud.

Block 131 Royalty Update

PetroTal is also pleased to announce that it has executed an agreement with Perupetro to modify the Block 131 License Contract, establishing a new, differentiated royalty regime for incremental production at the Los Angeles field. Under the new framework, royalties on qualifying incremental production from the producing Cushabatay formation will be assessed on a price-sensitive sliding scale of 5%, 9%, and 15%, tied to the applicable Basket Price. The new royalty framework applies to volumes from new wells and workovers, including those conducted as part of PetroTal's 2025 work program. It is estimated that approximately 60% of the field's current production will be entitled to the new royalty scheme, while the remaining 40% will stay at the original royalty of 23.5%.

Importantly, any future production from the untested deeper Noi and Copacabana formations will carry a flat 5% royalty, setting a precedent for future contracts. As part of the agreement, PetroTal's contribution to the local Social Fund will increase to 2.5%, underscoring the Company's continued commitment to the communities in which it operates. In exchange for a reduced royalty structure, PetroTal has also committed to drill two new wells at Block 131 in the next two years; if the wells are not drilled within that timeframe, the royalty for all production will revert to the original 23.5%. The Company believes this new structure, and the Peruvian government's willingness to negotiate more competitive terms, reflects a broader effort to make Peru's oil and gas sector more attractive to investment, and meaningfully improves the economics of future drilling at Los Angeles.

Bretana Erosion Control Project

PetroTal continues to evaluate several proposals to reinitiate construction activities at the erosion control project. As disclosed previously, PetroTal has largely suspended construction activities for the erosion control project, after terminating its contract with the previous construction consortium in March 2026. The Company is proceeding methodically with the new tender process to ensure it selects the appropriate contractor, along with the right project scope and design. PetroTal has secured the jack-up rig and service barges needed for the work and stands ready to resume construction once contractor selection is complete. In the meantime, PetroTal's engineering team and its advisors have observed a positive response to erosion remediation efforts at the three partially constructed breakwaters at Bretana, and the Company will continue to supplement the riverbank with hydrobags, as it has done previously. PetroTal will continue to provide updates on this important infrastructure investment as necessary.

Corporate Presentation Update

PetroTal will be hosting investor meetings in London, England the week of September 7. Ahead of its scheduled investor outreach, the Company has updated its Corporate Presentation, which is available for download or viewing at https://petrotalcorp.com/investors/

ABOUT PETROTAL

PetroTal is a publicly traded, tri‐quoted (TSX: TAL) (AIM: PTAL) (OTCQX: PTALF) oil and gas development and production Company domiciled in Calgary, Alberta, focused on the development of oil assets in Peru. PetroTal's flagship asset is its 100% working interest in the Bretana Norte oil field in Peru's Block 95, where oil production was initiated in June 2018. In early 2022, PetroTal became the largest crude oil producer in Peru. The Company's management team has significant experience in developing and exploring for oil in Peru and is led by a Board of Directors that is focused on safely and cost effectively developing the Bretana oil field. It is actively building new initiatives to champion community sensitive energy production, benefiting all stakeholders. For further information, please see the Company's website at www.petrotal-corp.com, the Company's filed documents at www.sedarplus.ca, or below:

Camilo McAllister
Executive Vice President and Chief Financial Officer
Cmcallister@PetroTal-Corp.com
T: (713) 253-4997

Manolo Zuniga
President and Chief Executive Officer
Mzuniga@PetroTal-Corp.com
T: (713) 609-9101

PetroTal Investor Relations
InvestorRelations@PetroTal-Corp.com

Celicourt Communications
Mark Antelme / Charles Denley-Myerson
petrotal@celicourt.uk
T : +44 (0) 20 7770 6424

Strand Hanson Limited (Nominated & Financial Adviser)
Ritchie Balmer / James Spinney / Edward Foulkes
T: +44 (0) 207 409 3494

Stifel Nicolaus Europe Limited (Joint Broker)
Callum Stewart / Simon Mensley / Ashton Clanfield\
T: +44 (0) 20 7710 7600

Peel Hunt LLP (Joint Broker)
Richard Crichton / David McKeown / Georgia Langoulant
T: +44 (0) 20 7418 8900

READER ADVISORIES

FORWARD-LOOKING STATEMENTS: This press release contains certain statements that may be deemed to be forward-looking statements. Such statements relate to possible future events, including, but not limited to: oil production levels and production capacity; PetroTal's development program for drilling, completions and other activities, including Block 131 and Bretana; plans and expectations with respect to the erosion control project; and PetroTal's expectations with respect to dividends and share buybacks. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "believe", "expect", "plan", "estimate", "potential", "will", "should", "continue", "may", "objective", "intend" and similar expressions. The forward-looking statements provided in this press release are based on management's current belief, based on currently available information, as to the outcome and timing of future events. The forward-looking statements are based on certain key expectations and assumptions made by the Company, including, but not limited to, expectations and assumptions concerning the ability of existing infrastructure to deliver production and the anticipated capital expenditures associated therewith, the ability to obtain and maintain necessary permits and licenses, the ability of government groups to effectively achieve objectives in respect of reducing social conflict and collaborating towards continued investment in the energy sector, reservoir characteristics, recovery factor, exploration upside, prevailing commodity prices and the actual prices received for PetroTal's products, including pursuant to hedging arrangements, the availability and performance of drilling rigs, facilities, pipelines, other oilfield services and skilled labour, royalty regimes and exchange rates, the impact of inflation on costs, the application of regulatory and licensing requirements, the accuracy of PetroTal's geological interpretation of its drilling and land opportunities, current legislation, receipt of required regulatory approval, the success of future drilling and development activities, the performance of new wells, future river water levels, the Company's growth strategy, general economic conditions and availability of required equipment and services. PetroTal cautions that forward-looking statements relating to PetroTal are subject to all of the risks, uncertainties and other factors, which may cause the actual results, performance, capital expenditures or achievements of the Company to differ materially from anticipated future results, performance, capital expenditures or achievements expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses; and health, safety and environmental risks), business performance, legal and legislative developments including changes in tax laws and legislation affecting the oil and gas industry and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures, credit ratings and risks, fluctuations in interest rates and currency values, changes in the financial landscape both domestically and abroad, including volatility in the stock market and financial system, wars (including Russia's war in Ukraine and the Israeli-Hamas conflict), regulatory developments, commodity price volatility, price differentials and the actual prices received for products, exchange rate fluctuations, legal, political and economic instability in Peru, access to transportation routes and markets for the Company's production, changes in legislation affecting the oil and gas industry, changes in the financial landscape both domestically and abroad (including volatility in the stock market and financial system) and the occurrence of weather-related and other natural catastrophes. Readers are cautioned that the foregoing list of factors is not exhaustive. Please refer to the annual information form for the year ended December 31, 2025 and the management's discussion and analysis for the three months ended June 30, 2026 for additional risk factors relating to PetroTal, which can be accessed either on PetroTal's website at www.petrotal-corp.com or under the Company's profile on www.sedarplus.ca. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

OIL REFERENCES: All references to "oil" or "crude oil" production, revenue or sales in this press release mean "heavy crude oil" as defined in National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101").

SHORT TERM RESULTS: References in this press release to peak rates, initial production rates, current production rates, 30-day production rates and other short-term production rates are useful in confirming the presence of hydrocarbons, however such rates are not determinative of the rates at which such wells will commence production and decline thereafter and are not indicative of long-term performance or of ultimate recovery. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production of PetroTal. The Company cautions that such results should be considered to be preliminary.

FOFI DISCLOSURE: This press release contains future-oriented financial information and financial outlook information (collectively, "FOFI") about PetroTal's prospective results of operations and production results, 2026 drilling program and budget, well investment payback, cash position, liquidity and components thereof, all of which are subject to the same assumptions, risk factors, limitations and qualifications as set forth in the above paragraphs. FOFI contained in this press release was approved by management as of the date of this press release and was included for the purpose of providing further information about PetroTal's anticipated future business operations. PetroTal and its management believe that FOFI has been prepared on a reasonable basis, reflecting management's best estimates and judgments, and represent, to the best of management's knowledge and opinion, the Company's expected course of action. However, because this information is highly subjective, it should not be relied on as necessarily indicative of future results. PetroTal disclaims any intention or obligation to update or revise any FOFI contained in this press release, whether as a result of new information, future events or otherwise, unless required pursuant to applicable law. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein. All FOFI contained in this press release complies with the requirements of Canadian securities legislation, including NI 51-101. Changes in forecast commodity prices, differences in the timing of capital expenditures, and variances in average production estimates can have a significant impact on the key performance measures included in PetroTal's guidance. The Company's actual results may differ materially from these estimates.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/313207

FAQ

How has PetroTal improved production deliverability at the Bretana field?

At Bretana, PetroTal completed a pulling campaign in which it replaced production tubing and electric submersible pumps in five wells. The company states that remediation work in these wells has improved production deliverability and helped offset natural field declines. It then started workovers on two water injection wells to increase water injection capacity ahead of resuming development drilling.

What are the key conditions attached to the new Block 131 royalty regime?

Under the modified Block 131 License Contract, the lower sliding-scale royalties apply to qualifying incremental production from the Cushabatay formation, including volumes from new wells and workovers in the 2025 work program. In exchange, PetroTal has committed to drill two new wells at Block 131 within the next two years. If the wells are not drilled in that timeframe, the royalty rate for all production at the field will revert to the original 23.5%.

What is PetroTal doing about the Bretana erosion control project after suspending most construction?

PetroTal largely suspended construction on the Bretana erosion control project after terminating its contract with the previous construction consortium in March 2026. The company is running a new tender process to select a contractor and refine project scope and design. It has already secured a jack-up rig and service barges and reports a positive response at three partially constructed breakwaters, while continuing to supplement the riverbank with hydrobags.

How will PetroTal’s Social Fund contribution change under the Block 131 agreement?

As part of the Block 131 License Contract amendment, PetroTal’s contribution to the local Social Fund will increase to 2.5%. The company describes this as underscoring its ongoing commitment to the communities where it operates.

Where can investors find PetroTal’s updated corporate presentation?

Ahead of investor meetings in London during the week of September 7, PetroTal has updated its Corporate Presentation. The presentation is available for download or viewing on the company’s website at https://petrotalcorp.com/investors/.