Gran Tierra Vitality Inc. stated Tuesday it has entered an settlement with Colombia’s Ecopetrol S.A. retaining the Canadian firm’s operatorship of the Suroriente block for 20 extra years with $123 million in preliminary funding.
Gran Tierra in 2019 acquired privately-operated Suroriente, which has since raised Gran Tierra’s gross oil manufacturing by 32 % by this 12 months, in response to the multinational.
“The extra time period of the contract permits long-term funding in infrastructure and work packages to boost oil restoration effectivity in present fields, and appraisal drilling to probably delay the lifetime of the fields”, it stated in a press launch.
The preliminary capital funding within the deal is to be spent over three years from the extension’s effectivity date, to be decided after authorities approval of the contract, Gran Tierra stated. The Calgary city-headquartered firm expects to cowl the funding from its inner money stream.
“Since changing into the operator, Gran Tierra has been capable of improve 100% gross oil manufacturing from a mean of 6,203 barrels of oil per day (bopd) in February 2019 to a mean of 8,167 bopd throughout first quarter 2023, a rise of 32 %”, the discharge stated.
Gran Tierra holds a 52-percent working curiosity within the Suroriente undertaking and nationwide oil firm Ecopetrol owns the remaining 48 %. Gran Tierra had a 15.83-percent curiosity earlier than the 2019 acquisition.
Gran Tierra, whose frequent shares commerce in Toronto, London and New York, stated its Suroriente curiosity lined proved plus possible reserves of 6.1 million barrels of oil as of 2018.
It stated the contract extension “additional strengthens and consolidates Gran Tierra’s place as a premier operator and the highest contracted space holder within the Putumayo Basin and supplies continuity to the Firm’s long-term enterprise relationship with Ecopetrol”.
“The settlement represents a novel and vital alternative in Colombia when it comes to scale and upside potential whereas sustaining our long-term partnership with Ecopetrol within the prolific Putumayo Basin”, Gran Tierra president and chief government Gary Guidry commented in Tuesday’s announcement.
Gran Tierra acquired the operatorship of Suroriente from Vetra Exploración y Producción Colombia S.A.S. (Vetra E&P). In addition to Suroriente, the 2019 Colombian transaction initially valued at $104.2 million concerned the sale to Gran Tierra of Vetra E&P’s 100-percent curiosity in Llanos-5 block, Vetra E&P’s 50-percent curiosity in Putumayo-8 block and Vetra Energía S.L.’s total shares in its wholly-owned subsidiary Vetra Southeast S.L.U., in response to a submitting with the U.S. Securities and Trade Fee.
Gran Tierra produced 31,700 barrels of oil per day on common within the first quarter of 2023.
“Manufacturing within the Suroriente Block averaged roughly 8,167 bopd gross (4,247 bopd WI) in the course of the quarter, its second highest quarterly manufacturing common since second quarter 2015, regardless of no growth wells being drilled since first quarter 2018”, it stated in an operational replace April 4.
Gran Tierra recorded its highest web revenue on document in 2022 at $139 million. Its output final 12 months averaged 30,746 bopd, a 16-percent year-on-year improve pushed by drillings in Colombia’s Acordionero and Costayaco fields. Gran Tierra collected $711.4 million from oil gross sales, up 50 % from 2021, in response to its outcomes revealed February 21.
“Constructing on the profitable growth and exploration drilling in 2022, as beforehand forecast, Gran Tierra expects 2023 manufacturing of 32,000-34,000 bopd, a 4-11 % improve from 2022”, it stated within the full-year earnings report.
Gran Tierra traded 1.626 % decrease on the Toronto Inventory Trade, 1.11 % decrease on the New York Inventory Trade and flat on the London Inventory Trade in closing costs Tuesday.
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