PetroTal Corp (AIM: PTAL): 76% 2P Reserves Replacement Ratio despite Brent price drop
• YE25 reserves stand at 66.4 mmbbl (1P), 110.2 mmbbl (2P) and 185.5 mmbbl (3P). After adjusting for 7.1 mmbbl of 2025 production, PetroTal added 6.4 mmbbl of 1P and 3.6 mmbbl of 2P reserves during the year, while 3P reserves fell by 20.7 mmbbl.• The reduction in 3P volumes reflects volumes now considered unlikely to be produced within the remaining 15‑year licence life under current oil price assumptions.
• After 6.9 mmbbl of 2025 production, YE25 1P and 2P reserves at Bretana are essentially unchanged versus YE24, despite a US$5.5–11.5/bbl reduction in Brent price assumptions. Additions stem from strong well performance in the V2 sands, which supports a higher recovery factor (oil‑in‑place unchanged). PetroTal has also added six new 2P drilling locations, including five new 1P locations, and incorporated four new water disposal wells to meet higher water‑handling requirements.
• Water‑handling capacity is expected to increase to 500 mbbl/d in the 1P case (from 320 mbbl/d today) and 800 mbbl/d in the 2P case.
• The expanded drilling programme and the required water‑handling upgrades increase future 2P development capex by roughly US$260 mm from YE25 levels, on top of the ~US$75 mm of capex planned for 2025.
• Incorporating YE25 reserves and updated future capex, we have changed our target price to £0.55 per share. The YE25 reserves release provides clearer visibility on forward development costs—particularly the water‑handling expansion—which is important for reinforcing confidence in the Bretana growth profile, with production expected to resume its upward trajectory from 3Q26.
Los Angeles
Under the current oil price environment, the Los Angeles field has been deprioritised. Following the inconclusive results from the 4Q25 workover campaign, only two deviated wells are now planned for the area, leading to a 1.7 mmbbl reduction in 2P reserves.
Valuation
Our 2P Core NAV is now £0.46 per share, more than twice the current share price, with a ReNAV of £0.55 per share. The reserves auditor values PetroTal’s 1P reserves (NPV10, after tax) at £0.56 per share, equivalent to 2.6× the current share price.
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
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