Petrotal Share Discussion Threads

[sleveen] 14/4/2021 09:16

So now we have political instability following on from community instability.

Peru will gain a reputation of being anti-investment.

70% tax regime, no one will invest in Peru.

Stupidity beyond belief.

[johnhemming] 14/4/2021 07:03

If it had not been Fujimori herself then Castillo would have lost. However, there are two questions:
a) In an unpopularity contest what will happen?
b) Peru has compulsory voting, but about 20%+ of people cast invalid votes (intentionally) will some of them vote for him.

Still we don't know. Investment as with anything else has known unknowns and unknown unknows. This is an unknown that people have become more aware of.

[doughcyclone] 13/4/2021 22:10

Yes a left populist won the first round. 2nd, 3rd, 4th and 5th place are all to the right though. Surely Fujimori will win the final round in June. Can’t see Castillo getting above 50%.

[johnhemming] 13/4/2021 20:28

This is the standard phrase:


8. The contract-laws, which shield mega-corruption in perpetuity, must be eliminated, making transnational companies keep 70% or more of the profits and only 30% for the State, and sometimes exempt from taxes. This proportion must be reversed and if the company does not comply with the new rules, the site in question must be nationalized.

The complexity for Petrotal is that a large amount was invested previously in Bretana which is why there should not be tax taken until the project in the round is in profit.

What the 30:70 - 70:30 thing means is not clear.

However, it is the shifting sands that causes the real problem with all of this and the concept that the state should not be bound by contract principles. (which is what you get from populist trots).

Still we are some way off from this anyway.

[johnroger] 13/4/2021 19:51

Thanks for the links John, plenty of reasons for caution!

[johnhemming] 13/4/2021 19:36

This is perhaps quite a useful article


Of note in this is Castillo wanting to change the constitution which means he sees it as a problem to what he would like to do.

[johnhemming] 13/4/2021 18:06

I found this a useful link:

[johnhemming] 13/4/2021 07:05

I think the Fujimori Castillo run-off will cause concerns. I personally want to see the balance of seats in the congress to make a further judgment. I don't think Castillo has much support in the congress and there may be 87 people elected who would vote to impeach either of the candidates.

I would expect this uncertainty to hold back the share price and it will probably take beyond June to get any certainty to replace this.

I think the Monthly average b/d are most useful with 7,963 in April and 7,072 in March. The peruvian government have an average of 5,643 for 2020.

[johnhemming] 11/4/2021 17:00

I think there always are questions as to the reliability of forecasts. I saw this particularly with RBS dollar denominated preference shares during the early 2010s where the contracts were clear, but the market did not initially distinguish between the ones where payment was discretionary and those where it was compulsory.

Once payment goes through (and in this instance it probably requires the accounts to report revenue) then the market responds.

Decisions at this stage depend upon judgment as to the reliability of forecasts. Hence also where there is an election in the offing and also questions about the virus it is probably a bit early for a market response. There have also been people willing to sell who may have got their shares for 10p. That will stop at some stage.

A bird in the hand is always a positive thing.

[johnroger] 11/4/2021 15:57

Looking at Sharescope consensus

EPS year ending 12/21 6.86p
EPS year ending 12/22 11.02p

Based on $1.37 to £1.00

[johnroger] 11/4/2021 15:41

PTAL features in the IC 1 month EPS upgrades this week going from 1.7p 1 month ago to current forecast of 4.5p

With the recent flow of good news and a prospective PER of 4 obviously very few believe the forecast to be credible. I wonder what it will take for the "market" to wake up.

[buffythebuffoon] 09/4/2021 09:58

Thanks Sturm2, that’s an excellent informative post.

Buffy

[sturm2] 09/4/2021 09:34

Re. production it's a bit complicated. I assume exports via Brazil is "pure crude", same for barge deliveries to Iquitas refinery, while distribution via ONP is added by the 3.5% they're blending in. So sales from ONP will be 3.5% higher than the production listed in the tables. But it's minor details, hard (or rather timeconsuming) to calculate exactly and as you say - the blending comes with a cost (why money for acquisition was probably raised?). But the main question is surely answered: Is export numbers included in the PeruPetro table: YES. Nothing is hidden.

Regarding the true up (cf Twitter): Manolo Zuniga, President & CEO: “With our strong current liquidity position, approximately $36m of unbudgeted true-up revenue coming in 2021, and a fully funded capital program, I anticipate an exciting growth trajectory for our Company over the coming years.”
So. Unbudgeted :=)

Also this is just crazy: "With oil at $60/b, in two years the company could not only pay the bonds but also invest in 2P capex, he said. Next year, we will finish our 2P capex, and in 2023 we will finish our 3P capex; then, it will be free cash flow for years to come," Zuniga said. And "PetroTal is confident production will "plateau" above 10,000 b/d for over 12 years, he said."

That..... is just amazing

[johnhemming] 08/4/2021 20:26

I did know that there was some money in the bond for Petroperu, I tend to look at the broader picture, however.

[thommie] 08/4/2021 20:22

btw did anyone realize in the last presentation that we paid petroperu 16mio back on contingent liabilities from the 100 mio bond?so I think we have to say that the true up revenue in reality becomes less this figure if I get it right?on the other hand they say our net debt is around 60mio (100 mio bond plus 44mio liabilities minus 83mio cash and equivalents). Im not sure if the true up revenue comes on top of it or is already included in cash equivalents? if not the net debt could be even lower soon. I think the drilling costs will be more than self funded with selling of our oil production if brent stays over 60$\bbl.so if everything comes together we could in best case scenario come to a point were we look at a company that could be net debt free at the end of 2021 entering 2022 with a production of around 20 000 bopd.

[sturm2] 08/4/2021 19:21

Thommie you're not completely right.

The Perupetro table only shows the *crude* oil volumes that are the basis for royalty payments. Petrotal blend the crude oil with ~3.5% natural gasoline, so actual sales are therefore ~3.5% higher (Manolo's words). It's also expensive and they can increase netback with 1 USD pr barrel if they can drill and blend e.g. osheki or light oil from some other field.

But IMO you're completely right regarding the share price We have 35 mio+ USD in true up in ONP, we probably have a NAV-10 pretax above 750 mio @ Brent 60 (and a 300 mio tax asset! and assuming recovery rate rise just a bit as in similar fields). Market cap is around 200 mio. USD.

So, looking for a bit of diversification since I'm neck deep in Petrotal - does any other junior/medium sized O&G *PRODUCING* company offer the same NAV-10/market cap ratio?

[thommie] 08/4/2021 19:04

john I do know it for sure, as I asked the company by email some time ago.first what you did and many people do, they forget that petroperu (the owner of onp and talara refinery) are not the same like perupetro (an official state ministry). but the namens are confusing and looking like the same!perupetro is releasing the production figures you refer to and they are gathered for the purpose to charge the oil firms with royalties on their production. so it is ofc including all produced oil in lot 95 including all brazil exports.ptal btw confirmed me that the figures from perupetro are exactly the production they produce, at least on a bigger timeframe, as they do not exactly stand for the real daily production as they are often mixed or late reported, but in avg they account for the real production. you can recheck it if you read their full year results for 2020 the figure of cumulative 2020 production of a bit over 2mio bbls they rnsed is nearly exactly the production that perupetro reported for 2020. It's just some 1000 bbls different which relates to the time shifting between production in lot 95 and the reporting by perupetro.btw strange that we had absolutely no share price movement while many positiv things were said in the last rns. I think market needs more reassurance to get back trust after 2020 and many warrants can be executed as well.

[tbeerbrewer] 08/4/2021 09:24

The statistics includes everything.
PetroTal adds about 4% of diluent for crude that goes into the pipeline to get the right API.

[mount teide] 08/4/2021 08:49

Euroclear's latest Stock on Loan(short) Report published today:

0.00% - Jadestone Energy / No Change
0.28% - PetroTal / (up from 0.00%)
0.68% - Savannah Energy / (up from 0.55%)

2.23% - Pantheon Resources / (up from 0.45%)
2.58% - Shell / (down from 3.79%)
2.97% - Enquest / (down from 3.60%)

4.05% - BP / (up from 3.89%)
6.21% - Cairn / (down from 6.43%)
7.14% - Touchstone Exp / (up from 1.23%)

[johnhemming] 08/4/2021 08:42

Does anyone know if the Petroperu production figures are just the pipeline or whether it is a total including exports to Brazil?

[johnhemming] 08/4/2021 08:42

Does anyone know if the Petroperu production figures are just the pipeline or whether it is a total including exports to Brazil?

[doughcyclone] 08/4/2021 08:04

9235 bopd last 10 days