Page 15 - LatAmOil Week 06 2021

LatAmOil NEWS IN BRIEF LatAmOil

FY 2020 Summary: Average daily produc- production levels to be optimised and down- for the measurement of the adherence between
tion up 7% to 3,226 bpd (FY 2019: 3,007 bpd). times to be minimised. Automation is also realisation prices and international prices did
Operating break-even down 23% to $20.5/bbl expected to improve margins and free cash flow not result in losses, having been achieved the
(FY 2019: $26.4/bbl). Cash balance up 46% to generation by reducing well intervention works objective of maintaining import prices parity, in
$20.2mn at 31 December 2020 (31 December (including workovers). the same way that occurred in 2019.
2019: $13.8mn). Net cash up 27% to $17.5mn Trinity Exploration, February 08 2021 Even in an extremely challenging period for
(FY 2019: $13.8mn). Total liquidity of $22.5mn the global oil industry, financial results for the
(net cash + CIBC working capital facility). first nine months of 2020 showed strong cash
FY 2021 Guidance Summary: Production FINANCE flow generation and debt reduction, contradict-
guidance of 2,900-3,100 bpd (before drilling ing claims of alleged losses from our commercial
of new wells). Capital expenditure guidance Petrobras: Alignment policy.
of $6.0-8.0mn (before drilling of new wells). In January 2021, Petrobras kept unchanged
Hedging in place for circa 50% of 2021 average with international oil the periodicity adopted from June 2020 onwards
production levels to protect against oil price for the measurement of the adherence of the
declines. Focus on maintaining production, prices has not changed alignment between realisation prices and inter-
preserving cash flow and investing to establish national prices, without any further changes.
an energy business of scale. Petrobras is clarifying a piece of news published The volatility of fuel prices and exchange
Building on Momentum: Trinity was able on Friday afternoon, February 5, 2021, based on rates, whether upward or downward, is a per-
to meet production guidance for 2020 despite distorted statements released by the press. manent phenomenon, which may increase or
drilling no new wells. Management has a strat- The maintenance of the periodicity for the decrease in the face of unanticipated specific
egy in place to underpin production levels in the measurement of the adherence between reali- events. The simple modification of the period
current year, with 2021 production guidance of sation prices and international prices, adopted for assessing the adherence between realisation
2,900-3,100 bpd being achieved by increasing since June 2020 and confirmed in January 2021, prices and international prices brought about
efficiencies from existing wells. At the same time, was mistakenly communicated by the press as a eight months ago does not constitute a rupture
we are accelerating the integration and interpre- change in the company’s commercial policy. of our unswerving commitment to align our
tation of the recently acquired 3D seismic data, As a practice previously adopted and main- prices in Brazil to international prices and the
which will enable the high grading of high angle tained since 2019, Petrobras follows the pricing consequent generation of value for shareholders.
and horizontal development drilling candidates. of fuels in line with international prices con- Petrobras reaffirms the statements made by
These studies will define the wider prospectivity verted into Brazilian reais by the real/US dollar CEO Roberto Castello Branco, at an event on
of the Licence areas with a view to building fur- exchange rate. This system has been widely and the morning of last Friday, February 5, 2021, in
ther low risk infrastructure-led exploration and repeatedly disclosed to the market over time. Brasília, of independence from external interfer-
appraisal drilling prospects. In June and August 2019, we publicly ences in determining its prices.
The quality of the Company’s portfolio of announced that price adjustments would no Petrobras remains strongly committed to
assets and the strength of its team underpins longer follow a pre-defined periodicity, and this value generation, reliability in the supply of qual-
management’s confidence in Trinity’s ability to remains unchanged. ity fuels for its customers, respect for people, the
explore and develop new projects that will build Although Petrobras is practically the only environment and the safety of its operations.
a business of scale and assist energy transition in petroleum products producer in Brazil, with Petrobras, February 07 2021
Trinidad. The Company aims to further enhance 98% of refining capacity, it faces competition
its asset base and unlock value from offshore from importers whose market shares varies from
opportunities via partnerships – notably, the 20 to 30% of the domestic market, depending on
Echo development on the East Coast and poten- the product.
tially the Jubilee Field bid process on the West Fuels are global commodities, such as soy-
Coast (which is currently in progress), as well beans and iron ore, whose prices are typically
as the onshore North West District bid process volatile, as well as exchange rates. In view of
(which is still at an early stage). The Company the significant increase in the volatility of these
will update the market when there is notable variables, the company decided in June 2020 to
progress on these initiatives. change from quarterly to annual the period for
Licence Extensions: The Company extended measuring the adherence between realisation
the term of its Lease Operatorship Agreements prices and international prices. Such change
(LOAs) with Heritage Petroleum Company for should not be mistaken, in any way, for a change
its WD-2, WD-5/6, WD-13 and WD-14 blocks in commercial policy, the setting of periodicity
to March 31, 2021. The LOAs were originally set for readjustments or in performance targets.
to expire on December 31, 2020, and have been Likewise, the continuous monitoring of the
extended under existing terms and conditions markets by our team remains unchanged, which
while Trinity and Heritage finalise negotiations includes, among other procedures, the daily
regarding longer term extensions and renewals computation and analysis of the behavior of our
for its LOA properties. prices in relation to international prices and the
Automation Roll-out: The Company is planning of actions to correct deviations.
on track to meet its target of having 31 wells This business routine, unlike strategic goals,
automated at its largest onshore field, WD5/6, policies and results, is not a subject that deserves
by H2-2021. This is expected to facilitate an public disclosure.
increase in revenues from the field by allowing As expected, the change in the periodicity

Week 06 11•February•2021 www. NEWSBASE .com P15