PetroTal Corp. — Call Transcript 2026

Hello. Thank you for joining PetroTal's Q1 results webcast. Your presenters today are Manolo Zúñiga, President and CEO, and Camilo McAllister, CFO. As usual, questions can be submitted via the platform during the webcast, and we'll do our best to answer them in the time available. Manolo, can I hand over to you? Thank you. Thank you, Mark. Good morning, everyone, and thank you for joining PetroTal's Q1 2026 webcast, where we're going to discuss the financial and operational results we released overnight. My name is Manolo Zúñiga, and I am the President and CEO of PetroTal. I am joined today by Camilo McAllister, our Executive Vice President and Chief Financial Officer. If you have clicked on the link in this morning's press release, you should hopefully see our slide presentation on your screen. Before I begin, I should mention that there are some disclaimers towards the end of the main presentation on our website, which I encourage you to read after our prepared remarks. On slide two, we have provided a summary of our key operational and financial metrics. Starting on the left-hand side, we highlight our recent production performance. In the first quarter of 2026, PetroTal delivered average production of approximately 14,900 barrels of oil per day, modestly lower than the prior quarter. As we will discuss later in the presentation, we remain comfortable with our full year production guidance of approximately 12,000 barrels per day. Reflecting the recent strength in oil prices, we have increased our EBITDA guidance to a range of $10 million-$110 million, a significant increase from our prior outlook of $30 million-$40 million. There is no change in our capital expenditure budget at this time. While we invest $7.6 million in the first quarter, we expect activity to accelerate in the second half of the year as we resume our development drilling program. Based on our updated outlook, using forward current oil prices, we plan to end the year with a cash balance roughly in line with current levels. On slide three, I would like to show our oil production and water injection capacity so far this year. The blue line shows the results of our recent water injection stimulation program, which we discussed in our press release this morning. Prior to the stimulation program, our water disposal capacity had been fixed at 170,000 barrels per day for quite some time. Following the stimulation program, our water injection capacity briefly spiked to almost 200,000 barrels per day before settling at around 180,000-185,000 barrels per day over the past week. Our water injection capacity is important because the more water we are able to dispose, the more oil we can produce. Current water cuts in our field range from 90% to 96%, averaging around 93.6%. Every 10,000 barrels per day of increase in water disposal allows us to produce approximately 500 more barrels of oil per day. Of course, the new oil wells will bring down the average field water cut. Our medium-term goal is to reach 240,000 barrels per day, and eventually 320,000 barrels per day of injection capacity and beyond. We have already seen a small boost in our production as a result of the stimulation campaign, and we would expect to see additional bump when we complete pulling jobs on three wells in Q3 2026. I would also like to point out that we have included our budget expectation in the red line in this chart. This is the same line we published with our Q3 2025 results back in November 2025, and I am pleased to report that we have been trending about 3% above expectations year to date in 2026. As we pointed out in our press release this morning, we have not made any changes to our production outlook at this point, but it's nice to be carrying a small buffer as we approach the midpoint of the year. Thank you, Manolo. Turning to slide four, we have summarized the PetroTal's financial performance for the 1st quarter of 2026. As Manolo noted earlier, our average production during the quarter was 14,907 barrels of oil per day, which represents a modest decline relative to Q4 2025. Despite a slightly lower production, PetroTal generated an adjusted EBITDA of $35.1 million in Q1 2026, which is an increase of 90% compared to the prior quarter. Our business model is built to capitalize on higher oil prices, with the recent strength in Brent, a large portion of our price gains flow directly into our earnings. If you look past the one-off expenses from late last year, the underlying growth in our EBITDA is very clear. To see the resilience of our model, it is helpful to look back at Q1 2025. Back then, we were producing over 23,000 barrels a day, even though Brent prices were similar to what they are today. Our net operating income only decreased by about $2 per barrel. Maintaining those margins despite lower production volumes really proves how well we've controlled our costs. While higher oil prices provide a great tailwind, they will not distract us from our commitment to cost discipline. Reducing costs remains a core pillar of our 2026 strategy. We are aggressively targeting lower spending in both operations and G&A, not just on a per barrel basis, but also in total dollars. This ensures that when we return to production growth next year in 2027, we'll be doing so from a much leaner and more profitable foundation. Moving to slide five, we are providing an update to PetroTal's 2026 EBITDA guidance in light of the recent strength in crude oil prices. As a reminder, our original 2026 guidance issued in January was based on an assumed Brent oil price of $60 per barrel. Under that pricing scenario, PetroTal expected to generate approximately $30 million-$40 million of adjusted EBITDA for the year. As highlighted in this morning's result, PetroTal has already generated approximately $35 million of adjusted EBITDA during the first quarter of 2026, despite benefiting from elevated oil prices for only part of the quarter. Looking ahead, we know the market remains volatile. However, if we look at current price trends as a guide, and assuming an average Brent price of $83 per barrel for the rest of the year, PetroTal is positioned for a much stronger 2026. Under this scenario, we would expect to generate roughly $180 million in net operating income, which is double our original forecast. If these price levels hold for the remainder of the year, the resulting adjusted EBITDA would move into the $110 million-$120 million range. At that level, our operations would fully fund our $80 million-$90 million capital program, whilst also covering all the taxes and financing costs. To be clear, these figures reflect a change in the market, not a change in our operational plan. We're sticking to our production target of 11,500 to 12,500 barrels per day, and we'll continue to manage our cost structure aggressively. We will provide further updates as the year progresses and the price environment becomes more certain. Wrapping up with slide six, I want to briefly touch on our crude oil marketing dynamics. Given the recent divergence between the spot and the future markets, we are often asked what pricing PetroTal is currently receiving for its crude sales. As we've discussed on our last quarterly webcast, pricing for the Brazil export route, which represents the vast majority of our sales volume, is linked to the ICE Brent month three price. Prior to the escalation of the geopolitical tensions earlier this year, the Brent curve was relatively flat, making our realized pricing fairly straightforward to estimate. However, over the past two months, the market has become a lot more volatile, and the Brent curve has moved into backwardation, meaning future delivery months are trading below the current month. In fact, Brent month three pricing has recently traded approximately $5-$10 per barrel below the near month for extended periods. While we would obviously prefer to capture the highest possible realized price, it is important to note that even the third month of the Brent strip has at times exceeded $100 per barrel in recent weeks. Accordingly, when we reference realized oil prices in our guidance and cash flow sensitivities, those assumptions are based on a Brent month three pricing rather than current spot prices. With that, I will turn the call back over to Mark, and please let us know if you have any questions. Thank you, Camilo. First question, given April was one of the highest priced months for oil in recent, history, can you expand on why you've chosen to conduct maintenance which has the effect of reducing production, albeit temporarily? As I explained it in my remarks, we did not do maintenance. We, what we did is, work on the water disposal wells, to optimize the injectivity of those wells, which are allowing us to increase production. What we did is very quickly allow us to be able to produce more oil to take advantage of the prices. Thank you. Thank you, Manolo Zúñiga. With the Iquitos refinery offline, it seems the Brazilian route accounted for 98% of Q1 volumes. Could you provide an update on the refinery status and timing for normalization? Yeah, the reason we are not delivering oil from Bretaña to Iquitos is that Petroperú, unfortunately, the state oil company, is having financial issues, they're not paying on time. We cannot afford delivering oil and not getting paid. That's why the Bretaña oil nowadays is going to the Brazilian route. We do sell a little bit from the Los Angeles field, we try to manage very carefully how much Petroperú owes us. Okay. Thank you. Next question. Given forecasts for a strong El Niño this year, is it fair to expect limited impact at current production levels? We don't know yet. The El Niño have different patterns. Usually it rains a lot in the coast, in the northern coast of Peru, but sometimes it could either rain or be dry on the Andes, which feed the Amazon River. We don't know yet. It's too early. Right now the river levels are quite high, so we should be okay, I believe. Okay. Thank you. onto the rig. Can you give us any general information on the jurisdiction the rig is in and the timeline for its export? Are the risk provisions of the contract in terms of getting a rig to our camp and commencing drilling typical for the oil and gas industry? Are there any provisions investors should be aware of? Thank you. No, all provisions are typical. The rig is currently about to finish activities in Colombia, in the south of Colombia, in an area called Putumayo, which borders with Ecuador. When it's rigged down and prepared for transportation or logistics, it will go first by road across the border from Colombia to Ecuador to a port in Ecuador, and it will navigate through the Napo River all the way to, you know, to the Peruvian border and then to our field. This is about a 1,000 km journey and it's all on time to continue with our program of drilling in October. Just to add in, Most of our production equipment we purchase from Ecuador, and we use exactly the same route, so we're very familiar with that. Okay. Thank you both. If the oil pricing continues and EBITDA is as indicated for the year as per the presentation, will you issue a special dividend? At this time, the company is not considering a special dividend. Let me remind everybody kind of our capital allocation framework. You know, first, obviously, we want to execute our capital program. Our focus is on resume drilling and continue to optimize our water fluid handling capacity. Second, we would first reduce debt. Third, we could evaluate some return of capital options. This is something we will not consider until we have stabilized our production at the levels that we want and that we are expecting to be in during 2027. Thank you, Camilo. Can you please identify the source of cost savings of circa $2.5 million versus Q1 2025 and $9 million versus Q4 2025, and how sustainable these savings are? There are two sources of savings. There are savings in G&A, and there are savings from our operating costs. The bigger variance that you just described against the fourth quarter of 2025 has to do with the pulling jobs and the workovers that we performed at the end of last year. We did not perform any of those during the first quarter. That is the main variance. Okay. Thank you. At this stage, there are no further questions. Let's just give it a second, see whether any others come through. No. Okay. Can I hand it back, Manolo Zúñiga and Camilo McAllister, for any closing remarks? Yes. Thank you so much, Mark, and I would like to thank all of our investors for their support. We're very excited about having a drilling rig back in Bretaña drilling and increasing production once again as we had it last year. Thank you so much.

Speaker 3: Hello. Thank you for joining PetroTal's Q1 results webcast. Your presenters today are Manolo Zúñiga, President and CEO, and Camilo McAllister, CFO. As usual, questions can be submitted via the platform during the webcast, and we'll do our best to answer them in the time available. Manolo, can I hand over to you? Thank you. Hello. hello Thank you for joining PetroTal's Q1 results webcast. thank you for joining petrotal's q1 results webcast Your presenters today are Manolo Zúñiga, President and CEO, and Camilo McAllister, CFO. your presenters today are manolo zúñiga president and ceo and camilo mcallister cfo As usual, questions can be submitted via the platform during the webcast, and we'll do our best to answer them in the time available. as usual questions can be submitted via the platform during the webcast and we'll do our best to answer them in the time available Manolo, can I hand over to you? manolo can i hand over to you Thank you. thank you

Speaker 2: Thank you, Mark. Good morning, everyone, and thank you for joining PetroTal's Q1 2026 webcast, where we're going to discuss the financial and operational results we released overnight. My name is Manolo Zúñiga, and I am the President and CEO of PetroTal. I am joined today by Camilo McAllister, our Executive Vice President and Chief Financial Officer. If you have clicked on the link in this morning's press release, you should hopefully see our slide presentation on your screen. Before I begin, I should mention that there are some disclaimers towards the end of the main presentation on our website, which I encourage you to read after our prepared remarks. On slide two, we have provided a summary of our key operational and financial metrics. Starting on the left-hand side, we highlight our recent production performance. Thank you, Mark. thank you mark Good morning, everyone, and thank you for joining PetroTal's Q1 2026 webcast, where we're going to discuss the financial and operational results we released overnight. good morning everyone and thank you for joining petrotal's q1 2026 webcast where we're going to discuss the financial and operational results we released overnight My name is Manolo Zúñiga, and I am the President and CEO of PetroTal. my name is manolo zúñiga and i am the president and ceo of petrotal I am joined today by Camilo McAllister, our Executive Vice President and Chief Financial Officer. i am joined today by camilo mcallister our executive vice president and chief financial officer If you have clicked on the link in this morning's press release, you should hopefully see our slide presentation on your screen. if you have clicked on the link in this morning's press release you should hopefully see our slide presentation on your screen Before I begin, I should mention that there are some disclaimers towards the end of the main presentation on our website, which I encourage you to read after our prepared remarks. before i begin i should mention that there are some disclaimers towards the end of the main presentation on our website which i encourage you to read after our prepared remarks On slide two, we have provided a summary of our key operational and financial metrics. on slide two we have provided a summary of our key operational and financial metrics Starting on the left-hand side, we highlight our recent production performance. starting on the left-hand side we highlight our recent production performance In the first quarter of 2026, PetroTal delivered average production of approximately 14,900 barrels of oil per day, modestly lower than the prior quarter. As we will discuss later in the presentation, we remain comfortable with our full year production guidance of approximately 12,000 barrels per day. Reflecting the recent strength in oil prices, we have increased our EBITDA guidance to a range of $10 million-$110 million, a significant increase from our prior outlook of $30 million-$40 million. There is no change in our capital expenditure budget at this time. While we invest $7.6 million in the first quarter, we expect activity to accelerate in the second half of the year as we resume our development drilling program. In the first quarter of 2026, PetroTal delivered average production of approximately 14,900 barrels of oil per day, modestly lower than the prior quarter. in the first quarter of 2026 petrotal delivered average production of approximately 14,900 barrels of oil per day modestly lower than the prior quarter As we will discuss later in the presentation, we remain comfortable with our full year production guidance of approximately 12,000 barrels per day. as we will discuss later in the presentation we remain comfortable with our full year production guidance of approximately 12,000 barrels per day Reflecting the recent strength in oil prices, we have increased our EBITDA guidance to a range of $10 million-$110 million, a significant increase from our prior outlook of $30 million-$40 million. reflecting the recent strength in oil prices we have increased our ebitda guidance to a range of $10 million-$110 million a significant increase from our prior outlook of $30 million-$40 million There is no change in our capital expenditure budget at this time. there is no change in our capital expenditure budget at this time While we invest $7.6 million in the first quarter, we expect activity to accelerate in the second half of the year as we resume our development drilling program. while we invest $7.6 million in the first quarter we expect activity to accelerate in the second half of the year as we resume our development drilling program Based on our updated outlook, using forward current oil prices, we plan to end the year with a cash balance roughly in line with current levels. On slide three, I would like to show our oil production and water injection capacity so far this year. The blue line shows the results of our recent water injection stimulation program, which we discussed in our press release this morning. Prior to the stimulation program, our water disposal capacity had been fixed at 170,000 barrels per day for quite some time. Following the stimulation program, our water injection capacity briefly spiked to almost 200,000 barrels per day before settling at around 180,000-185,000 barrels per day over the past week. Based on our updated outlook, using forward current oil prices, we plan to end the year with a cash balance roughly in line with current levels. based on our updated outlook using forward current oil prices we plan to end the year with a cash balance roughly in line with current levels On slide three, I would like to show our oil production and water injection capacity so far this year. on slide three i would like to show our oil production and water injection capacity so far this year The blue line shows the results of our recent water injection stimulation program, which we discussed in our press release this morning. the blue line shows the results of our recent water injection stimulation program which we discussed in our press release this morning Prior to the stimulation program, our water disposal capacity had been fixed at 170,000 barrels per day for quite some time. prior to the stimulation program our water disposal capacity had been fixed at 170,000 barrels per day for quite some time Following the stimulation program, our water injection capacity briefly spiked to almost 200,000 barrels per day before settling at around 180,000-185,000 barrels per day over the past week. following the stimulation program our water injection capacity briefly spiked to almost 200,000 barrels per day before settling at around 180,000-185,000 barrels per day over the past week Our water injection capacity is important because the more water we are able to dispose, the more oil we can produce. Current water cuts in our field range from 90% to 96%, averaging around 93.6%. Every 10,000 barrels per day of increase in water disposal allows us to produce approximately 500 more barrels of oil per day. Of course, the new oil wells will bring down the average field water cut. Our medium-term goal is to reach 240,000 barrels per day, and eventually 320,000 barrels per day of injection capacity and beyond. We have already seen a small boost in our production as a result of the stimulation campaign, and we would expect to see additional bump when we complete pulling jobs on three wells in Q3 2026. Our water injection capacity is important because the more water we are able to dispose, the more oil we can produce. our water injection capacity is important because the more water we are able to dispose the more oil we can produce Current water cuts in our field range from 90% to 96%, averaging around 93.6%. current water cuts in our field range from 90% to 96% averaging around 93.6% Every 10,000 barrels per day of increase in water disposal allows us to produce approximately 500 more barrels of oil per day. every 10,000 barrels per day of increase in water disposal allows us to produce approximately 500 more barrels of oil per day Of course, the new oil wells will bring down the average field water cut. of course the new oil wells will bring down the average field water cut Our medium-term goal is to reach 240,000 barrels per day, and eventually 320,000 barrels per day of injection capacity and beyond. our medium-term goal is to reach 240,000 barrels per day and eventually 320,000 barrels per day of injection capacity and beyond We have already seen a small boost in our production as a result of the stimulation campaign, and we would expect to see additional bump when we complete pulling jobs on three wells in Q3 2026. we have already seen a small boost in our production as a result of the stimulation campaign and we would expect to see additional bump when we complete pulling jobs on three wells in q3 2026 I would also like to point out that we have included our budget expectation in the red line in this chart. This is the same line we published with our Q3 2025 results back in November 2025, and I am pleased to report that we have been trending about 3% above expectations year to date in 2026. As we pointed out in our press release this morning, we have not made any changes to our production outlook at this point, but it's nice to be carrying a small buffer as we approach the midpoint of the year. I would also like to point out that we have included our budget expectation in the red line in this chart. i would also like to point out that we have included our budget expectation in the red line in this chart This is the same line we published with our Q3 2025 results back in November 2025, and I am pleased to report that we have been trending about 3% above expectations year to date in 2026. this is the same line we published with our q3 2025 results back in november 2025 and i am pleased to report that we have been trending about 3% above expectations year to date in 2026 As we pointed out in our press release this morning, we have not made any changes to our production outlook at this point, but it's nice to be carrying a small buffer as we approach the midpoint of the year. as we pointed out in our press release this morning we have not made any changes to our production outlook at this point but it's nice to be carrying a small buffer as we approach the midpoint of the year

Speaker 1: Thank you, Manolo. Turning to slide four, we have summarized the PetroTal's financial performance for the 1st quarter of 2026. As Manolo noted earlier, our average production during the quarter was 14,907 barrels of oil per day, which represents a modest decline relative to Q4 2025. Despite a slightly lower production, PetroTal generated an adjusted EBITDA of $35.1 million in Q1 2026, which is an increase of 90% compared to the prior quarter. Our business model is built to capitalize on higher oil prices, with the recent strength in Brent, a large portion of our price gains flow directly into our earnings. If you look past the one-off expenses from late last year, the underlying growth in our EBITDA is very clear. To see the resilience of our model, it is helpful to look back at Q1 2025. Thank you, Manolo. thank you manolo Turning to slide four, we have summarized the PetroTal's financial performance for the 1st quarter of 2026. turning to slide four we have summarized the petrotal's financial performance for the 1st quarter of 2026 As Manolo noted earlier, our average production during the quarter was 14,907 barrels of oil per day, which represents a modest decline relative to Q4 2025. as manolo noted earlier our average production during the quarter was 14,907 barrels of oil per day which represents a modest decline relative to q4 2025 Despite a slightly lower production, PetroTal generated an adjusted EBITDA of $35.1 million in Q1 2026, which is an increase of 90% compared to the prior quarter. despite a slightly lower production petrotal generated an adjusted ebitda of $35.1 million in q1 2026 which is an increase of 90% compared to the prior quarter Our business model is built to capitalize on higher oil prices, with the recent strength in Brent, a large portion of our price gains flow directly into our earnings. our business model is built to capitalize on higher oil prices with the recent strength in brent a large portion of our price gains flow directly into our earnings If you look past the one-off expenses from late last year, the underlying growth in our EBITDA is very clear. if you look past the one-off expenses from late last year the underlying growth in our ebitda is very clear To see the resilience of our model, it is helpful to look back at Q1 2025. to see the resilience of our model it is helpful to look back at q1 2025 Back then, we were producing over 23,000 barrels a day, even though Brent prices were similar to what they are today. Our net operating income only decreased by about $2 per barrel. Maintaining those margins despite lower production volumes really proves how well we've controlled our costs. While higher oil prices provide a great tailwind, they will not distract us from our commitment to cost discipline. Reducing costs remains a core pillar of our 2026 strategy. We are aggressively targeting lower spending in both operations and G&A, not just on a per barrel basis, but also in total dollars. This ensures that when we return to production growth next year in 2027, we'll be doing so from a much leaner and more profitable foundation. Back then, we were producing over 23,000 barrels a day, even though Brent prices were similar to what they are today. back then we were producing over 23,000 barrels a day even though brent prices were similar to what they are today Our net operating income only decreased by about $2 per barrel. our net operating income only decreased by about $2 per barrel Maintaining those margins despite lower production volumes really proves how well we've controlled our costs. maintaining those margins despite lower production volumes really proves how well we've controlled our costs While higher oil prices provide a great tailwind, they will not distract us from our commitment to cost discipline. while higher oil prices provide a great tailwind they will not distract us from our commitment to cost discipline Reducing costs remains a core pillar of our 2026 strategy. We are aggressively targeting lower spending in both operations and G&A, not just on a per barrel basis, but also in total dollars. reducing costs remains a core pillar of our 2026 strategy. we are aggressively targeting lower spending in both operations and g&a not just on a per barrel basis but also in total dollars This ensures that when we return to production growth next year in 2027, we'll be doing so from a much leaner and more profitable foundation. this ensures that when we return to production growth next year in 2027 we'll be doing so from a much leaner and more profitable foundation Moving to slide five, we are providing an update to PetroTal's 2026 EBITDA guidance in light of the recent strength in crude oil prices. As a reminder, our original 2026 guidance issued in January was based on an assumed Brent oil price of $60 per barrel. Under that pricing scenario, PetroTal expected to generate approximately $30 million-$40 million of adjusted EBITDA for the year. As highlighted in this morning's result, PetroTal has already generated approximately $35 million of adjusted EBITDA during the first quarter of 2026, despite benefiting from elevated oil prices for only part of the quarter. Looking ahead, we know the market remains volatile. However, if we look at current price trends as a guide, and assuming an average Brent price of $83 per barrel for the rest of the year, PetroTal is positioned for a much stronger 2026. Moving to slide five, we are providing an update to PetroTal's 2026 EBITDA guidance in light of the recent strength in crude oil prices. moving to slide five we are providing an update to petrotal's 2026 ebitda guidance in light of the recent strength in crude oil prices As a reminder, our original 2026 guidance issued in January was based on an assumed Brent oil price of $60 per barrel. as a reminder our original 2026 guidance issued in january was based on an assumed brent oil price of $60 per barrel Under that pricing scenario, PetroTal expected to generate approximately $30 million-$40 million of adjusted EBITDA for the year. under that pricing scenario petrotal expected to generate approximately $30 million-$40 million of adjusted ebitda for the year As highlighted in this morning's result, PetroTal has already generated approximately $35 million of adjusted EBITDA during the first quarter of 2026, despite benefiting from elevated oil prices for only part of the quarter. as highlighted in this morning's result petrotal has already generated approximately $35 million of adjusted ebitda during the first quarter of 2026 despite benefiting from elevated oil prices for only part of the quarter Looking ahead, we know the market remains volatile. looking ahead we know the market remains volatile However, if we look at current price trends as a guide, and assuming an average Brent price of $83 per barrel for the rest of the year, PetroTal is positioned for a much stronger 2026. however if we look at current price trends as a guide and assuming an average brent price of $83 per barrel for the rest of the year petrotal is positioned for a much stronger 2026 Under this scenario, we would expect to generate roughly $180 million in net operating income, which is double our original forecast. If these price levels hold for the remainder of the year, the resulting adjusted EBITDA would move into the $110 million-$120 million range. At that level, our operations would fully fund our $80 million-$90 million capital program, whilst also covering all the taxes and financing costs. To be clear, these figures reflect a change in the market, not a change in our operational plan. We're sticking to our production target of 11,500 to 12,500 barrels per day, and we'll continue to manage our cost structure aggressively. We will provide further updates as the year progresses and the price environment becomes more certain. Under this scenario, we would expect to generate roughly $180 million in net operating income, which is double our original forecast. under this scenario we would expect to generate roughly $180 million in net operating income which is double our original forecast If these price levels hold for the remainder of the year, the resulting adjusted EBITDA would move into the $110 million-$120 million range. if these price levels hold for the remainder of the year the resulting adjusted ebitda would move into the $110 million-$120 million range At that level, our operations would fully fund our $80 million-$90 million capital program, whilst also covering all the taxes and financing costs. at that level our operations would fully fund our $80 million-$90 million capital program whilst also covering all the taxes and financing costs To be clear, these figures reflect a change in the market, not a change in our operational plan. to be clear these figures reflect a change in the market not a change in our operational plan We're sticking to our production target of 11,500 to 12,500 barrels per day, and we'll continue to manage our cost structure aggressively. we're sticking to our production target of 11,500 to 12,500 barrels per day and we'll continue to manage our cost structure aggressively We will provide further updates as the year progresses and the price environment becomes more certain. we will provide further updates as the year progresses and the price environment becomes more certain Wrapping up with slide six, I want to briefly touch on our crude oil marketing dynamics. Given the recent divergence between the spot and the future markets, we are often asked what pricing PetroTal is currently receiving for its crude sales. As we've discussed on our last quarterly webcast, pricing for the Brazil export route, which represents the vast majority of our sales volume, is linked to the ICE Brent month three price. Prior to the escalation of the geopolitical tensions earlier this year, the Brent curve was relatively flat, making our realized pricing fairly straightforward to estimate. However, over the past two months, the market has become a lot more volatile, and the Brent curve has moved into backwardation, meaning future delivery months are trading below the current month. Wrapping up with slide six, I want to briefly touch on our crude oil marketing dynamics. wrapping up with slide six i want to briefly touch on our crude oil marketing dynamics Given the recent divergence between the spot and the future markets, we are often asked what pricing PetroTal is currently receiving for its crude sales. given the recent divergence between the spot and the future markets we are often asked what pricing petrotal is currently receiving for its crude sales As we've discussed on our last quarterly webcast, pricing for the Brazil export route, which represents the vast majority of our sales volume, is linked to the ICE Brent month three price. as we've discussed on our last quarterly webcast pricing for the brazil export route which represents the vast majority of our sales volume is linked to the ice brent month three price Prior to the escalation of the geopolitical tensions earlier this year, the Brent curve was relatively flat, making our realized pricing fairly straightforward to estimate. prior to the escalation of the geopolitical tensions earlier this year the brent curve was relatively flat making our realized pricing fairly straightforward to estimate However, over the past two months, the market has become a lot more volatile, and the Brent curve has moved into backwardation, meaning future delivery months are trading below the current month. however over the past two months the market has become a lot more volatile and the brent curve has moved into backwardation meaning future delivery months are trading below the current month In fact, Brent month three pricing has recently traded approximately $5-$10 per barrel below the near month for extended periods. While we would obviously prefer to capture the highest possible realized price, it is important to note that even the third month of the Brent strip has at times exceeded $100 per barrel in recent weeks. Accordingly, when we reference realized oil prices in our guidance and cash flow sensitivities, those assumptions are based on a Brent month three pricing rather than current spot prices. With that, I will turn the call back over to Mark, and please let us know if you have any questions. In fact, Brent month three pricing has recently traded approximately $5-$10 per barrel below the near month for extended periods. in fact brent month three pricing has recently traded approximately $5-$10 per barrel below the near month for extended periods While we would obviously prefer to capture the highest possible realized price, it is important to note that even the third month of the Brent strip has at times exceeded $100 per barrel in recent weeks. while we would obviously prefer to capture the highest possible realized price it is important to note that even the third month of the brent strip has at times exceeded $100 per barrel in recent weeks Accordingly, when we reference realized oil prices in our guidance and cash flow sensitivities, those assumptions are based on a Brent month three pricing rather than current spot prices. accordingly when we reference realized oil prices in our guidance and cash flow sensitivities those assumptions are based on a brent month three pricing rather than current spot prices With that, I will turn the call back over to Mark, and please let us know if you have any questions. with that i will turn the call back over to mark and please let us know if you have any questions

Speaker 3: Thank you, Camilo. First question, given April was one of the highest priced months for oil in recent, history, can you expand on why you've chosen to conduct maintenance which has the effect of reducing production, albeit temporarily? Thank you, Camilo. thank you camilo First question, given April was one of the highest priced months for oil in recent, history, can you expand on why you've chosen to conduct maintenance which has the effect of reducing production, albeit temporarily? first question given april was one of the highest priced months for oil in recent history can you expand on why you've chosen to conduct maintenance which has the effect of reducing production albeit temporarily

Speaker 2: As I explained it in my remarks, we did not do maintenance. We, what we did is, work on the water disposal wells, to optimize the injectivity of those wells, which are allowing us to increase production. What we did is very quickly allow us to be able to produce more oil to take advantage of the prices. As I explained it in my remarks, we did not do maintenance. as i explained it in my remarks we did not do maintenance We, what we did is, work on the water disposal wells, to optimize the injectivity of those wells, which are allowing us to increase production. we what we did is work on the water disposal wells to optimize the injectivity of those wells which are allowing us to increase production What we did is very quickly allow us to be able to produce more oil to take advantage of the prices. what we did is very quickly allow us to be able to produce more oil to take advantage of the prices

Speaker 3: Thank you. Thank you, Manolo Zúñiga. With the Iquitos refinery offline, it seems the Brazilian route accounted for 98% of Q1 volumes. Could you provide an update on the refinery status and timing for normalization? Thank you. thank you Thank you, Manolo Zúñiga. thank you manolo zúñiga With the Iquitos refinery offline, it seems the Brazilian route accounted for 98% of Q1 volumes. with the iquitos refinery offline it seems the brazilian route accounted for 98% of q1 volumes Could you provide an update on the refinery status and timing for normalization? could you provide an update on the refinery status and timing for normalization

Speaker 2: Yeah, the reason we are not delivering oil from Bretaña to Iquitos is that Petroperú, unfortunately, the state oil company, is having financial issues, they're not paying on time. We cannot afford delivering oil and not getting paid. That's why the Bretaña oil nowadays is going to the Brazilian route. We do sell a little bit from the Los Angeles field, we try to manage very carefully how much Petroperú owes us. Yeah, the reason we are not delivering oil from Bretaña to Iquitos is that Petroperú, unfortunately, the state oil company, is having financial issues, they're not paying on time. yeah the reason we are not delivering oil from bretaña to iquitos is that petroperú unfortunately the state oil company is having financial issues they're not paying on time We cannot afford delivering oil and not getting paid. we cannot afford delivering oil and not getting paid That's why the Bretaña oil nowadays is going to the Brazilian route. that's why the bretaña oil nowadays is going to the brazilian route We do sell a little bit from the Los Angeles field, we try to manage very carefully how much Petroperú owes us. we do sell a little bit from the los angeles field we try to manage very carefully how much petroperú owes us

Speaker 3: Okay. Thank you. Next question. Given forecasts for a strong El Niño this year, is it fair to expect limited impact at current production levels? Okay. okay Thank you. thank you Next question. next question Given forecasts for a strong El Niño this year, is it fair to expect limited impact at current production levels? given forecasts for a strong el niño this year is it fair to expect limited impact at current production levels

Speaker 2: We don't know yet. The El Niño have different patterns. Usually it rains a lot in the coast, in the northern coast of Peru, but sometimes it could either rain or be dry on the Andes, which feed the Amazon River. We don't know yet. It's too early. Right now the river levels are quite high, so we should be okay, I believe. We don't know yet. we don't know yet The El Niño have different patterns. the el niño have different patterns Usually it rains a lot in the coast, in the northern coast of Peru, but sometimes it could either rain or be dry on the Andes, which feed the Amazon River. usually it rains a lot in the coast in the northern coast of peru but sometimes it could either rain or be dry on the andes which feed the amazon river We don't know yet. we don't know yet It's too early. it's too early Right now the river levels are quite high, so we should be okay, I believe. right now the river levels are quite high so we should be okay i believe

Speaker 3: Okay. Thank you. onto the rig. Can you give us any general information on the jurisdiction the rig is in and the timeline for its export? Are the risk provisions of the contract in terms of getting a rig to our camp and commencing drilling typical for the oil and gas industry? Are there any provisions investors should be aware of? Okay. okay Thank you. onto the rig. thank you onto the rig Can you give us any general information on the jurisdiction the rig is in and the timeline for its export? can you give us any general information on the jurisdiction the rig is in and the timeline for its export Are the risk provisions of the contract in terms of getting a rig to our camp and commencing drilling typical for the oil and gas industry? are the risk provisions of the contract in terms of getting a rig to our camp and commencing drilling typical for the oil and gas industry Are there any provisions investors should be aware of? are there any provisions investors should be aware of

Speaker 1: Thank you. No, all provisions are typical. The rig is currently about to finish activities in Colombia, in the south of Colombia, in an area called Putumayo, which borders with Ecuador. When it's rigged down and prepared for transportation or logistics, it will go first by road across the border from Colombia to Ecuador to a port in Ecuador, and it will navigate through the Napo River all the way to, you know, to the Peruvian border and then to our field. This is about a 1,000 km journey and it's all on time to continue with our program of drilling in October. Thank you. thank you No, all provisions are typical. no all provisions are typical The rig is currently about to finish activities in Colombia, in the south of Colombia, in an area called Putumayo, which borders with Ecuador. the rig is currently about to finish activities in colombia in the south of colombia in an area called putumayo which borders with ecuador When it's rigged down and prepared for transportation or logistics, it will go first by road across the border from Colombia to Ecuador to a port in Ecuador, and it will navigate through the Napo River all the way to, you know, to the Peruvian border and then to our field. when it's rigged down and prepared for transportation or logistics it will go first by road across the border from colombia to ecuador to a port in ecuador and it will navigate through the napo river all the way to you know to the peruvian border and then to our field This is about a 1,000 km journey and it's all on time to continue with our program of drilling in October. this is about a 1,000 km journey and it's all on time to continue with our program of drilling in october

Speaker 2: Just to add in, Most of our production equipment we purchase from Ecuador, and we use exactly the same route, so we're very familiar with that. Just to add in, Most of our production equipment we purchase from Ecuador, and we use exactly the same route, so we're very familiar with that. just to add in most of our production equipment we purchase from ecuador and we use exactly the same route so we're very familiar with that

Speaker 3: Okay. Thank you both. If the oil pricing continues and EBITDA is as indicated for the year as per the presentation, will you issue a special dividend? Okay. okay Thank you both. thank you both If the oil pricing continues and EBITDA is as indicated for the year as per the presentation, will you issue a special dividend? if the oil pricing continues and ebitda is as indicated for the year as per the presentation will you issue a special dividend

Speaker 1: At this time, the company is not considering a special dividend. Let me remind everybody kind of our capital allocation framework. You know, first, obviously, we want to execute our capital program. Our focus is on resume drilling and continue to optimize our water fluid handling capacity. Second, we would first reduce debt. Third, we could evaluate some return of capital options. This is something we will not consider until we have stabilized our production at the levels that we want and that we are expecting to be in during 2027. At this time, the company is not considering a special dividend. at this time the company is not considering a special dividend Let me remind everybody kind of our capital allocation framework. let me remind everybody kind of our capital allocation framework You know, first, obviously, we want to execute our capital program. you know first obviously we want to execute our capital program Our focus is on resume drilling and continue to optimize our water fluid handling capacity. our focus is on resume drilling and continue to optimize our water fluid handling capacity Second, we would first reduce debt. second we would first reduce debt Third, we could evaluate some return of capital options. third we could evaluate some return of capital options This is something we will not consider until we have stabilized our production at the levels that we want and that we are expecting to be in during 2027. this is something we will not consider until we have stabilized our production at the levels that we want and that we are expecting to be in during 2027

Speaker 3: Thank you, Camilo. Can you please identify the source of cost savings of circa $2.5 million versus Q1 2025 and $9 million versus Q4 2025, and how sustainable these savings are? Thank you, Camilo. thank you camilo Can you please identify the source of cost savings of circa $2.5 m illion versus Q1 2025 and $9 million versus Q4 2025, and how sustainable these savings are? can you please identify the source of cost savings of circa $2.5 m illion versus q1 2025 and $9 million versus q4 2025 and how sustainable these savings are

Speaker 1: There are two sources of savings. There are savings in G&A, and there are savings from our operating costs. The bigger variance that you just described against the fourth quarter of 2025 has to do with the pulling jobs and the workovers that we performed at the end of last year. We did not perform any of those during the first quarter. That is the main variance. There are two sources of savings. there are two sources of savings There are savings in G&A, and there are savings from our operating costs. there are savings in g&a and there are savings from our operating costs The bigger variance that you just described against the fourth quarter of 2025 has to do with the pulling jobs and the workovers that we performed at the end of last year. the bigger variance that you just described against the fourth quarter of 2025 has to do with the pulling jobs and the workovers that we performed at the end of last year We did not perform any of those during the first quarter. we did not perform any of those during the first quarter That is the main variance. that is the main variance

Speaker 3: Okay. Thank you. At this stage, there are no further questions. Let's just give it a second, see whether any others come through. No. Okay. Can I hand it back, Manolo Zúñiga and Camilo McAllister, for any closing remarks? Okay. okay Thank you. thank you At this stage, there are no further questions. at this stage there are no further questions Let's just give it a second, see whether any others come through. let's just give it a second see whether any others come through No. no Okay. okay Can I hand it back, Manolo Zúñiga and Camilo McAllister, for any closing remarks? can i hand it back manolo zúñiga and camilo mcallister for any closing remarks

Speaker 2: Yes. Thank you so much, Mark, and I would like to thank all of our investors for their support. We're very excited about having a drilling rig back in Bretaña drilling and increasing production once again as we had it last year. Thank you so much. Yes. yes Thank you so much, Mark, and I would like to thank all of our investors for their support. thank you so much mark and i would like to thank all of our investors for their support We're very excited about having a drilling rig back in Bretaña drilling and increasing production once again as we had it last year. we're very excited about having a drilling rig back in bretaña drilling and increasing production once again as we had it last year Thank you so much. thank you so much