CALGARY,
AB, Feb. 10, 2025 /CNW/ - Petro-Victory
Energy Corp. ("Petro-Victory" or the "Company") (TSXV: VRY),
pursuant to the press release dated December
17th, 2024, is pleased to announce the signing of
a sale purchase agreement ("SPA"), in a 50/50 partnership with
Azevedo & Travassos Petroleo ("ATP"), for the acquisition of 13
oil fields denominated as Polo Porto Carão and Polo Barrinha from
3R RNCE S.A. and 3R Potiguar S.A., subsidiaries of Brava
Energia S.A. ("Brava", BVMF:BRAV3)
Key Highlights of the Acquisition
- Oil Fields: 13 oil fields with fully operational
production facilities comprising 38,301 acres
- Location: Onshore Brazil, Potiguar Basin, strategically located
adjacent to Petro-Victory's existing assets (See Figure
1)
- Production: Current production of 250 barrels of
oil per day with a high-impact work program to significantly
increase oil production.
- Reported Statistics: National Agency of Petroleum
has reported volume of oil in place 125 million barrels,
recovery factor 13.3%
- Total Acquisition Value: USD$15 million (net USD $7.5 million for Petro-Victory)
- Payment Structure: The payment will be made in four
tranches plus a gross overriding royalty, of which Petro-Victory's
contribution will be pro-rated at its 50% working interest.
- USD$600 thousand paid at
signing
- USD$2.9 million to be paid at
closing
- USD$3.5 million to be paid one
year after closing
- USD$4.5 million to be paid two
years after closing
- USD$3.5 million to be paid with a
7% gross overriding royalty
- Participation: Petro-Victory 50% working interest
and ATP 50% working interest.
- Seller: Brava Energia S.A. ("Brava",
BVMF:BRAV3)
Richard F. Gonzalez, CEO, commented:
"This
acquisition marks a transformative milestone for Petro-Victory,
significantly enhancing our oil production capacity and increasing
our proven reserves. We expect the updated reserve report will
increase our proven reserves by 50%. It also maximizes the
substantial investments made by our Subsurface, Engineering, and
Operations teams over the past five years in the Potiguar Basin.
Through disciplined strategy and technical expertise, we have built
a strong position and deep understanding of this oil prolific
basin. We are pleased to further strengthen our partnership with
ATP through this acquisition, reinforcing our commitment to
unlocking the full potential of the Potiguar Basin."
Strategic Rationale
The acquisition aligns with
Petro-Victory's strategy to generate accretive shareholder value
through disciplined investments in high-impact, low-risk assets in
Latin America.
The 13 oil fields acquired in the Potiguar Basin are adjacent to
Petro-Victory´s existing assets (see Figure 1). The Potiguar
Basin is the most oil prolific basin onshore Brazil, and the newly acquired fields increase
Petro-Victory´s production and reserves.
Petro-Victory currently has 3 oil producing fields and 34
exploration blocks in the Potiguar basin. Over the past 5 years,
Petro-Victory has reprocessed and merged 12 volumes of 3D seismic
data covering more than 1,500 km2 in the Potiguar basin
including volumes which cover the acquired fields. Petro-Victory
has also performed an extensive hydrocarbon basin analysis, as well
as an in-depth Geological, Geophysical and Petrophysical
interpretation.
Brava originally purchased the 13 oil fields from Petrobras
between the years 2020 and 2022. The fields were discovered in 1976
by Petrobras and have produced 16.5 million barrels of oil to date
with a 13.3% recovery factor.
Brava has a certified reserve report from DeGolyer and
MacNaughton which we are commissioning to complete a National
Instrument 51-101 compliant reserve report. This information will
be published when available.
Financial and Operational Impact for Petro-Victory
- Increased Production: The acquisition immediately adds 125
barrels of oil per day, net to Petro-Victory's production, with a
high-impact workover program in place to significantly enhance
production. The transaction includes the transfer of cash
generation related to the production and sale of oil as of the
signing date which will be credited to the Company at the time of
closing.
- Acquired infrastructure and equipment:
- 13 production stations
- Tanks: A total of 40 tanks (30, 40, and 60m³)
- Pumps: 11 transfer pumps and 6 injection pumps
- Infrastructure: Flow lines, power lines, SPDA (Lightning
Protection System), and fire-protection system
- Automation: Pintassilgo, Serraria, Porto Carão, and Lagoa
Aroeira are fully automated and have installed infrastructure for
injection capability
- Artificial Lift Wells: Equipped with Pump Jacks, Progressive
Cavity Pumps, and Electric Submersible Pumps
- Cost Synergies: The proximity of the new oil fields to our
existing assets enables us to streamline logistics and share
services such as maintenance, transportation, administrative
support, and resource allocation for personnel, equipment, and
technologies. This shared infrastructure significantly reduces
overall operational costs. Additionally, the economies of scale
lead to a lower per-barrel cost and improved profitability.
Furthermore, our larger combined production capacity enhances our
bargaining power with suppliers and service providers, resulting in
more favorable terms and reduced costs.
Work Program
The work program focuses on
maximizing production, improving recovery rates, and optimizing
operating costs through the following key initiatives:
- Well Reopening & Production Enhancement: Reactivate
currently shut-in wells to increase gross production and maximize
oil recovery.
- Advanced Cased-Hole Technologies: Utilize state-of-the-art
wellbore diagnostics to identify and target bypassed pay zones,
enhancing production efficiency.
- Secondary Recovery Implementation: Increase reservoir
pressure and improve recovery factors through secondary recovery
methods, such as water injection.
- Hydraulic Stimulation: Apply proven hydraulic stimulation
techniques to improve production.
Closing Timeline
The transaction is expected to close
in the second half of 2025 subject to customary closing conditions
and regulatory approvals with the National Agency of Petroleum in
Brazil.
About Petro Victory Energy Corp.
Petro Victory
Energy Corp. is engaged in the acquisition, development, and
production of crude oil and natural gas resources in Brazil. The Company holds 100% operating and
working interests in thirty-eight (38) licenses totaling 257,604
acres in two (2) different producing basins in Brazil. Petro-Victory generates accretive
shareholder value through disciplined investments in high-impact,
low-risk assets. The Company's Common Shares trade on the TSXV
under the ticker symbol VRY.
Cautionary Note
Neither the
TSXV nor its Regulation Services Provider (as that term is defined
in the policies of the TSXV) accepts responsibility for the
adequacy or accuracy of this release.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of
these securities, in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction. The
securities have not been and will not be registered under the
United States Securities Act of 1933, as amended (the "U.S.
Securities Act"), or any state securities laws and may not be
offered or sold within the United
States unless an exemption from such registration is
available.
Advisory Regarding Forward-Looking Statements
In
the interest of providing Petro
Victory's shareholders and potential investors with
information regarding Petro
Victory's future plans and operations, certain statements in
this press release are "forward-looking statements" within the
meaning of the United States Private Securities Litigation Reform
Act of 1995 and "forward-looking information" within the meaning of
applicable Canadian securities legislation (collectively,
"forward-looking statements"). In some cases, forward-looking
statements can be identified by terminology such as "anticipate,"
"believe," "continue," "could," "estimate," "expect," "forecast,"
"intend," "may," "objective," "ongoing," "outlook," "potential,"
"project," "plan," "should," "target," "would," "will" or similar
words suggesting future outcomes, events or performance. The
forward-looking statements contained in this press release speak
only as of the date thereof and are expressly qualified by this
cautionary statement.
Specifically, this press release
contains forward-looking statements relating to,
but not limited to, our business strategies, oil and natural gas
production levels, the filing of an updated reserve report, plans
and objectives, and drilling, testing, and
exploration expectations. These forward-looking statements are
based on certain key assumptions regarding, among other
things, our ability to add production and reserves through our
exploration activities; the receipt of the DeGolyer and MacNaughton
reserve report; the receipt, in a timely manner, of regulatory
and other required approvals for our operating activities;
the availability and cost of labor and other industry
services; the continuance of existing and, in
certain circumstances, proposed tax and royalty regimes;
and current industry conditions, laws and regulations
continuing in effect (or, where changes
are proposed, such changes being adopted
as anticipated). The receipt of a reserves report with greater
than 50% of reserves may not happen or may be different from
expectations. Readers are cautioned that
such assumptions, although considered reasonable by
Petro Victory at
the time of preparation, may prove
to be incorrect.
Actual results achieved will vary from the information provided
herein as a result of numerous known and unknown risks and
uncertainties and other factors.
The above summary of assumptions and risks related to
forward-looking statements in this press release has been provided
in order to provide shareholders and potential investors with a
more complete perspective on Petro Victory's current and
future operations, and such information may not be appropriate for
other purposes. There is no representation by Petro Victory that actual results achieved will
be the same in whole or in part as those referenced in the
forward-looking statements, and Petro
Victory does not undertake any obligation to update publicly
or to revise any of the included forward-looking statements,
whether as a result of new information, future events or otherwise,
except as may be required by applicable securities law.
BOE Disclosure
The term BARRELS OF OIL
EQUIVALENT ("boe") may be misleading, particularly if used in
isolation. A boe conversion ratio of six thousand cubic feet per
barrel (6 Mcf/bbl.) of natural gas to barrels of oil equivalence is
based on an energy equivalency conversion method primarily
applicable at the burner tip and does not represent a value
equivalency at the wellhead. All boe conversions in this news
release are derived from converting gas to oil in the ratio mix of
six thousand cubic feet of gas to one barrel of oil.
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SOURCE Petro-Victory Energy Corp.
