Q4 2023 Alvopetro Energy Ltd Earnings Call

Good morning everyone. Just a few administrative items before we start. We are recording today's earnings call and there will be a replay on our website later on today.

All participants are in listen-in-only mode. We will be having a Q&A session at the end of our presentation. If you're logged in,

online and watching on Zoom. You can use the Q&A button at any time to log your questions and we will get to those at the end of our presentation. If you are dialing in, you can send us an email at socialmedia.alvopetro.com and we will answer the questions that we get by email. And then lastly, you know, as per usual, we do go through various non-GAP measures and forward-looking statements, so please...

We encourage you to review all of the cautionary statements and other advisories that you'll find in our corporate presentation at the end of that corporate presentation that's on our website. With that, I'll hand it back over to Corey.

All right, thank you, Alison.

Okay, so just to show this chart that we often show, it shows all of our production history since starting our production from our cabaret field back in July of 2020. You can see in 2023 we did have a decrease due to some demand disruptions in the state of Bahia with our uptake of Bahia gas, particularly in the second and third quarters. We also saw some higher nominations from our partner at the cabaret unit, which did impact the amount of production available to El Popetro.

So...

The net result, as you can see, we actually had an increase in the fourth quarter of 2023 up to 2,143 barrels of oil equivalent per day. That was a 26% increase over the third quarter. And our 2023 average production averaged almost the exact same number at 2,142 barrels of oil equivalent per day.

We did see lower demand for Bahia gas at the start of 2024. You can see that in the January and February production that we've already announced.

We did have that production increase up again in March. We announced yesterday that our gas production for March to date is a little over 11 million cubic feet a day, which is up from just over 8 million cubic feet a day in that February number that you see there, so about a 35% increase.

In the last month, we updated our Reserves Contingent and Prospective Resource Report with GLTA as the evaluators, and this was previously announced on February 26th of this year.

Just some highlights of this report. We had 0.8 million barrels of oil production produced in 2023, but we only saw our 2P reserve decrease by about 0.3 million BOE.

The primary reason for that is we had additional volumes associated with the Terrasseau zone within our Rurikututu field that we're pursuing, and we'll talk more about that in a few later slides.

And this increased more than offset some of our technical revisions of production results from other wells in the field.

Yalvo Petro continues to focus on de-risking and unlocking the contingent resource reports and values we have associated with these fields at Numerca 2.2.

And note on the cabaret asset, these reserves are based on the 49.1% working interest as of December 31st, and that redetermination of this is currently underway.

The chart below shows the build-up and the relative magnitude of the 1P2P reserves, as well as the contingent prospective resource report value. We also plotted the enterprise value of Alopecho, and it's just under half of the total 2P value of the reserve report.

Big chunk of that is focused on our Merck Merck or two to work coming up.

Okay, and then we have a few questions around that Redetermination at the unit, which includes our cap <unk> APL.

Can you speak any more to your expectation.

Is that potentially lower QP reserves and is that part of the reason for cutting the dividend.

Okay.

Okay. So thats two to a couple of parts. So first of all we're right in the middle of this so it's hard for us to comment on it we do expect a final result here.

Near the end of March or in the early part of April.

And depending on that result, yes, it does have the ability or the potential to impact our reserves positively or negatively.

I would say it did not at all impact our decision on our Q1 dividend, but the Q1 dividend was.

Really a function of what this was our production and cash flow that we're estimating.

This is the proportion that we have said gets allocated to stakeholders and that's the proportion that were paid.

And do you have any update on the timing of when you will find out.

And the final decision on this arbitration agreement with a partner.

Yes, sorry that was like I.

You said at the end of it will be we're expecting it to be late March or early April.

Okay and are you looking to find other land for growth. If America Q2 does not meet your production cost.

Yes, so certainly that's part of our <unk>.

Workflow Theyre always looking for new opportunities be it new blocks or or or or acquisition opportunities those types of things. So.

We'll continue to look at those but given our strategic infrastructure and the location of our <unk> asset and we've got all the pipelines and infrastructure in place. That's obviously a high priority for us.

And then the last question I have here is do you think Alba Petro can be acquired or what are the prospects of that getting acquired in the future like petromin rallied back in 2013.

Yes.

This has happened at least a couple of times that management team with the calendar back in Ecuador, and detriment or always in Colombia. So these things are always possible we would.

I don't think Thats.

Personally.

Solid business plan, our business plan is to focus on all the things that we talked about today in and focused on growing and diversifying our production base now that being said if someone comes along and makes a compelling offer to our shareholders. That's something we would put forward to the shareholders.

Everyone listening on this call would have have a say in that in a boat and they get to decide for themselves whether thats something they think makes sense to accept.

Okay, and I do not have any further questions.