Business
PetroTal Announces Temporary Shut In of Bretana Oil Field Due to COVID-19 Pipeline Closure
Calgary, Alberta and Houston, Texas--(Newsfile Corp. - May 7, 2020) - PetroTal Corp. (TSXV: TA...
About this update from Petrotal Corp.
[{"type":"text","content":"PetroTal Announces Temporary Shut In of Bretana Oil Field Due to COVID-19 Pipeline ClosurePetroTal provides update on financing arrangementsCalgary, Alberta and Houston, Texas--(Newsfile Corp. - May 7, 2020) - PetroTal Corp. (TSXV: TAL) (AIM: PTAL) (\"PetroTal\" or the \"Company\") announces that the Northern Oil Pipeline (\"ONP\") operated by PETROPERU S.A. (\"Petroperu\") has been shut down by a public health directive from the Peruvian government, thereby resulting in PetroTal having to shut in the Bretana oil field as a result of storage capacity limitations. Additionally, PetroTal provides an update on financing initiatives to accommodate the impact of oil price reductions occurring from oil sales at the Bretana oil field in Block 95 in Peru. All monetary amounts in this release are in United States dollars.HighlightsThe health department of the Peruvian government issued a directive for COVID-19 prevention in high risk areas and for high risk individuals;Petroperu temporarily shuts down pipeline operations to comply with this directive;PetroTal temporarily shuts in Bretana oil field operations due to storage capacity limitations;The Company's planned capital expenditure for 2020 continues to be deferred;Reduce compensation for Management and Directors by 20%;Oil field shutdown will trigger significant cost reductions of operating, transportation and general and administrative costs;Resulting from the global oil price reduction, the Company has a contingent derivative liability of $42 million at March 31, 2020;The actual liability of the oil price difference determination is expected to be lower due to the projected improvement in oil prices when physical sales occur in Q3 and Q4, and;PetroTal advises of financing discussions for a multi-year settlement of the contingent liability. Pipeline and Bretana Oil Field Shut DownPetroTal has been notified by Petroperu, the operator of Peru's ONP that it has temporarily shut down the pipeline as a result of a directive from the Peruvian government intended to combat the spread of COVID-19 in the communities adjacent to the pipeline operations. The directive states that no employees over the age of 60 nor with serious chronic diseases, should be working in the high risk regions of Peru. Although Petroperu has filed an appeal with the Peruvian government to allow the pipeline to ...