Gran Tierra Energy Announces 2009 Year-End Reserves

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Gran Tierra Energy Inc	AMEX:GTE	AMEX	Common Stock

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Gran Tierra Energy (AMEX:GTE)
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Another Record Year for Proved Oil and Gas Reserves CALGARY, Feb. 22 /PRNewswire-FirstCall/ -- Gran Tierra Energy Inc. (NYSE Amex: GTE; TSX: GTE), a company focused on oil exploration and production in South America, today announced the results of an independent reserve evaluation of the company's reserves by GLJ Petroleum Consultants Ltd. effective December 31, 2009. Year-end 2009 Highlights (net after royalties): - Approximately 5.7 million barrels of working interest oil was produced in 2009; - Proved oil reserves increased 14.6 % to approximately 22.1 million barrels (SEC compliant); - Proved plus probable (2P) oil reserves are approximately 27.9 million barrels (no SEC equivalent in 2008); - Proved plus probable plus possible (3P) oil reserves are approximately 39.4 million barrels (no SEC equivalent in 2008); - Approximately 0.1 billion cubic feet of working interest gas was produced in 2009; - Proved gas reserves increased 61.0 % to approximately 1.9 billion cubic feet (SEC compliant); - Proved plus probable (2P) gas reserves are approximately 3.6 billion cubic feet (no SEC equivalent in 2008); - Proved plus probable plus possible (3P) gas reserves are approximately 38.1 billion cubic feet (no SEC equivalent in 2008). All reserves values contained in the 2009 Highlights, provided above, have been calculated using United States Securities Exchange Commission rules. For reserves values calculated in compliance with Canadian National Instrument 51-101 and the Canadian Oil and Gas Evaluation Handbook, see "Reserves Reported in Accordance with Canadian Reporting Requirements" below in this press release. "2009 was another excellent year for the growth of Gran Tierra Energy's reserve base, fueled in large part by development drilling in the Costayaco Field in Colombia and testing operations in the Valle Morado Field in Argentina," said Dana Coffield, President and CEO. "The focus for 2010 is to grow reserves through an active exploration drilling campaign, with seven exploration wells budgeted in Colombia and four exploration wells budgeted in Peru. In addition, drilling and seismic operations are budgeted to further define the gas potential of our lands in Argentina. We expect this to be funded out of available cash and cashflow from operations, allowing the company to remain debt free." Reserves Reported in Accordance with United States Reporting Requirements ------------------------------------------------------------------------- The following reserves are reported consistent with United States Securities and Exchange Commission rules. The following table summarizes Gran Tierra Energy's year-end 2009 working interest reserves and net after royalty reserves (with start of month average 2009 oil price). Also shown in the following table are Gran Tierra Energy's net after royalty reserves for year-end 2008 (with constant December 31, 2008 oil price and cost). Total Company ------------------------------------------------------------------------- Total Company 2009 Year-End 2009 Year-End 2008 Year-End Light and Medium Oil Gran Tierra Gran Tierra Gran Tierra Energy Energy Energy Working Interest NAR* NAR (SEC Compliant) Reserves Reserves Reserves ------------------------------------------------------------------------- Reserves Category MBO** MBO MBO ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 26,606 20,375 8,966 ------------------------------------------------------------------------- Developed Nonproducing 1,032 899 1,300 ------------------------------------------------------------------------- Undeveloped 1,037 808 8,972 ------------------------------------------------------------------------- Total Proved 28,675 22,082 19,238 ------------------------------------------------------------------------- Total Probable 7,543 5,821 N/A ------------------------------------------------------------------------- Total Proved plus Probable 36,218 27,902 N/A ------------------------------------------------------------------------- Total Possible 15,093 11,538 N/A ------------------------------------------------------------------------- Total PPP 51,130 39,440 N/A ------------------------------------------------------------------------- * NAR (net after royalty). ** MBO (thousand barrels of oil). - The increases in proved oil reserves is mainly associated with development drilling in the Costayaco Field in Colombia. ------------------------------------------------------------------------- Total Company 2009 Year-End 2009 Year-End 2008 Year-End Gas Gran Tierra Gran Tierra Gran Tierra Energy Energy Energy Working Interest NAR NAR (SEC Compliant) Reserves Reserves Reserves ------------------------------------------------------------------------- Reserves Category MMSCF*** MMSCF MMSCF ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 1,391 1,113 1,161 ------------------------------------------------------------------------- Developed Nonproducing 877 756 0 ------------------------------------------------------------------------- Undeveloped 0 0 0 ------------------------------------------------------------------------- Total Proved 2,268 1,869 1,161 ------------------------------------------------------------------------- Total Probable 2,076 1,739 N/A ------------------------------------------------------------------------- Total Proved plus Probable 4,344 3,608 N/A ------------------------------------------------------------------------- Total Possible 40,171 34,520 N/A ------------------------------------------------------------------------- Total PPP 44,515 38,128 N/A ------------------------------------------------------------------------- *** MMSCF (million standard cubic feet). - The increase in proved gas reserves is due to workover activity on VM.x-1001 in the Valle Morado Field in Argentina. Colombia Gran Tierra Energy's Colombia year-end 2009 working interest and net after royalty reserves are shown in the following table (with start of month average 2009 oil price). Also shown in the following table is Gran Tierra Energy's Colombian net after royalty reserves for year-end 2008 (with constant December 31, 2008 oil price and cost). ------------------------------------------------------------------------- Colombia 2009 Year-End 2009 Year-End 2008 Year-End Light and Medium Oil Gran Tierra Gran Tierra Gran Tierra Energy Energy Energy Working Interest NAR NAR (SEC Compliant) Reserves Reserves Reserves ------------------------------------------------------------------------- Reserves Category MBO MBO MBO ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 25,427 19,350 7,832 ------------------------------------------------------------------------- Developed Nonproducing 968 844 1,061 ------------------------------------------------------------------------- Undeveloped 794 597 8,788 ------------------------------------------------------------------------- Total Proved 27,189 20,791 17,681 ------------------------------------------------------------------------- Total Probable 6,564 4,972 N/A ------------------------------------------------------------------------- Total Proved plus Probable 33,754 25,762 N/A ------------------------------------------------------------------------- Total Possible 12,496 9,430 N/A ------------------------------------------------------------------------- Total PPP 46,250 35,192 N/A ------------------------------------------------------------------------- - The increase in proved reserves in Colombia is mainly associated with development drilling in the Costayaco Field. ------------------------------------------------------------------------- Colombia 2009 Year-End 2009 Year-End 2008 Year-End Gas Gran Tierra Gran Tierra Gran Tierra Energy Energy Energy Working Interest NAR NAR (SEC Compliant) Reserves Reserves Reserves ------------------------------------------------------------------------- Reserves Category MMSCF MMSCF MMSCF ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 1,391 1,113 1,161 ------------------------------------------------------------------------- Developed Nonproducing 0 0 0 ------------------------------------------------------------------------- Undeveloped 0 0 0 ------------------------------------------------------------------------- Total Proved 1,391 1,113 1,161 ------------------------------------------------------------------------- Total Probable 815 652 N/A ------------------------------------------------------------------------- Total Proved plus Probable 2,206 1,765 N/A ------------------------------------------------------------------------- Total Possible 1,735 1,388 N/A ------------------------------------------------------------------------- Total PPP 3,941 3,153 N/A ------------------------------------------------------------------------- The Costayaco Field 2009 year-end net after royalty reserves are shown in the following table (with start of month average 2009 oil price). Also shown in the following table is a comparison of the Costayaco Field 2009 year-end gross lease reserves (with start of the month average 2009 oil price) to the gross lease reserves estimated in July 31, 2009 (with constant July 31, 2009 oil price and cost). ------------------------------------------------------------------------- Costayaco 2009 Year-End 2009 Year-End July 31, 2009 Light and Medium Oil Costayaco Costayaco Costayaco Gran Tierra Gross Gross Energy Lease Lease NAR Reserves Reserves (SEC Compliant) Reserves ------------------------------------------------------------------------- Reserves Category MBO MBO MBO ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 18,151 24,016 9,546 ------------------------------------------------------------------------- Total Proved 18,748 24,810 19,657 ------------------------------------------------------------------------- Total Probable 4,592 6,133 N/A ------------------------------------------------------------------------- Total Proved plus Probable 23,340 30,943 N/A ------------------------------------------------------------------------- Total Possible 8,745 11,718 N/A ------------------------------------------------------------------------- Total PPP 32,085 42,661 N/A ------------------------------------------------------------------------- Argentina Gran Tierra Energy's Argentina working interest and net after royalty reserves are shown in the following table (with start of month average 2009 oil price). Also shown in the following table is Gran Tierra Energy's Argentina net after royalty reserves for year-end 2008 (with constant December 31, 2008 oil price and cost). ------------------------------------------------------------------------- Argentina 2009 Year-End 2009 Year-End 2008 Year-End Light and Medium Oil Gran Tierra Gran Tierra Gran Tierra Energy Energy Energy Working Interest NAR NAR (SEC Compliant) Reserves Reserves Reserves ------------------------------------------------------------------------- Reserves Category MBO MBO MBO ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 1,179 1,025 1,134 ------------------------------------------------------------------------- Developed Nonproducing 64 55 239 ------------------------------------------------------------------------- Undeveloped 243 211 184 ------------------------------------------------------------------------- Total Proved 1,486 1,291 1,557 ------------------------------------------------------------------------- Total Probable 978 850 N/A ------------------------------------------------------------------------- Total Proved plus Probable 2,464 2,140 N/A ------------------------------------------------------------------------- Total Possible 2,416 2,109 N/A ------------------------------------------------------------------------- Total PPP 4,879 4,248 N/A ------------------------------------------------------------------------- - The decrease in proved oil reserves is due to production. ------------------------------------------------------------------------- Argentina 2009 Year-End 2009 Year-End 2008 Year-End Gas Gran Tierra Gran Tierra Gran Tierra Energy Energy Energy Working Interest NAR NAR (SEC Compliant) Reserves Reserves Reserves ------------------------------------------------------------------------- Reserves Category MMSCF MMSCF MMSCF ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 0 0 0 ------------------------------------------------------------------------- Developed Nonproducing 877 756 0 ------------------------------------------------------------------------- Undeveloped 0 0 0 ------------------------------------------------------------------------- Total Proved 877 756 0 ------------------------------------------------------------------------- Total Probable 1,261 1,087 N/A ------------------------------------------------------------------------- Total Proved plus Probable 2,138 1,843 N/A ------------------------------------------------------------------------- Total Possible 38,436 33,132 N/A ------------------------------------------------------------------------- Total PPP 40,574 34,975 N/A ------------------------------------------------------------------------- - The increase in proved gas reserves is due to workover activity on VM.x-1001 in the Valle Morado Field in Argentina. Reserves Reported in Accordance with Canadian Reporting Requirements -------------------------------------------------------------------- The following reserves are compliant with Canadian National Instrument 51-101 (NI 51-101) and the Canadian Oil and Gas Evaluation Handbook (COGEH) (with forecasted oil price and costs): Total Company ------------------------------------------------------------------------- Total Company 2009 Year-End 2009 Year-End 2008 Year-End Light and Medium Oil Gran Tierra Gran Tierra Gran Tierra Energy Energy Energy Working Interest NAR NAR (NI 51-101 compliant) Reserves Reserves Reserves ------------------------------------------------------------------------- Reserves Category MBO MBO MBO ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 26,942 19,705 9,194 ------------------------------------------------------------------------- Developed Nonproducing 1,032 898 1,329 ------------------------------------------------------------------------- Undeveloped 1,051 784 8,289 ------------------------------------------------------------------------- Total Proved 29,025 21,386 18,811 ------------------------------------------------------------------------- Total Probable 7,304 5,410 8,676 ------------------------------------------------------------------------- Total Proved plus Probable 36,329 26,795 27,487 ------------------------------------------------------------------------- Total Possible 14,915 11,085 18,599 ------------------------------------------------------------------------- Total PPP 51,243 37,880 46,086 ------------------------------------------------------------------------- Gran Tierra Energy's year-end 2009 NAR reserves compared to year-end 2008 NAR reserves (compliant with NI 51-101 and COGEH) are as follows: - Proved light and medium oil reserves increased 13.5% due to development drilling in the Costayaco Field in Colombia. - In addition, Gran Tierra Energy also has year-end 2009 NAR proved gas reserves of approximately 1.9 billion cubic feet (BCF), an increase of 61.0 % from 1.2 BCF NAR proved gas reserves at year-end 2008 due to testing results in the Valle Morado Field in Argentina. - Probable light and medium oil reserves decreased 38% due to changes in reserve category allocation. - In addition, Gran Tierra Energy also has year-end 2009 NAR probable gas reserves of approximately 1.7 BCF, a decrease of 5.6% from 1.8 BCF NAR at year-end 2008. - Possible light and medium oil reserves decreased 41.5% due to negative test results of Costayaco-7. - In addition, Gran Tierra Energy also has year-end 2009 NAR possible gas reserves of approximately 34.5 BCF, an increase of 108% from 16.6 BCF NAR at year-end 2008 due to testing results in the Valle Morado Field in Argentina. Colombia Gran Tierra Energy's year-end 2009 Colombia working interest and net after royalty reserves are shown in the following table (NI 51-101 compliant with forecast oil price and cost). Also shown in the following table are Gran Tierra Energy's Colombian net after royalty reserves for year-end 2008 (NI 51-101 compliant with forecast oil price and cost). ------------------------------------------------------------------------- Colombia 2009 Year-End 2009 Year-End 2008 Year-End Light and Medium Oil Gran Tierra Gran Tierra Gran Tierra Energy Energy Energy Working Interest NAR NAR (NI 51-101 compliant) Reserves Reserves Reserves ------------------------------------------------------------------------- Reserves Category MBO MBO MBO ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 25,725 18,647 8,050 ------------------------------------------------------------------------- Developed Nonproducing 968 843 1,080 ------------------------------------------------------------------------- Undeveloped 822 585 8,108 ------------------------------------------------------------------------- Total Proved 27,515 20,075 17,237 ------------------------------------------------------------------------- Total Probable 6,322 4,557 7,706 ------------------------------------------------------------------------- Total Proved plus Probable 33,837 24,632 24,943 ------------------------------------------------------------------------- Total Possible 12,503 8,980 15,806 ------------------------------------------------------------------------- Total PPP 46,340 33,611 40,749 ------------------------------------------------------------------------- - The increases in proved reserves in Colombia is mainly associated with development drilling in the Costayaco Field. The decrease in possible reserves is due primarily to the negative test results from Costayaco-7. - In addition to the above proved light and medium oil reserves, Gran Tierra Energy also has year-end 2009 NAR proved gas reserves of approximately 1.1 BCF in Colombia. Gran Tierra Energy had 1.2 BCF proved gas reserves at year-end 2008 in Colombia. - In addition to the above probable light and medium oil reserves, Gran Tierra Energy also has year-end 2009 NAR probable gas reserves of approximately 0.7 BCF in Colombia. Gran Tierra Energy had 0.7 BCF NAR probable gas reserves at year-end 2008 in Colombia. - In addition to the above possible light and medium oil reserves, Gran Tierra Energy also has year-end 2009 NAR possible gas reserves of approximately 1.4 BCF in Colombia. Gran Tierra Energy had 1.9 BCF NAR possible gas reserves at year-end 2008 in Colombia. The Costayaco Field 2009 year-end net after royalty reserves are shown in the following table (with forecast oil price and cost). Also shown in the following table is a comparison of the Costayaco Field 2009 year-end gross lease reserves (with forecast oil price and cost) to the gross lease reserves estimated in July 31, 2009 (with forecast oil price and cost). ------------------------------------------------------------------------- Costayaco 2009 Year-End 2009 Year-End July 31, 2009 Light and Medium Oil Costayaco Costayaco Costayaco Gran Tierra Gross Gross Energy Lease Lease NAR Reserves Reserves (NI 51-101 compliant) Reserves ------------------------------------------------------------------------- Reserves Category MBO MBO MBO ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 17,398 24,257 9,800 ------------------------------------------------------------------------- Total Proved 17,983 25,079 19,657 ------------------------------------------------------------------------- Total Probable 4,153 5,864 10,635 ------------------------------------------------------------------------- Total Proved plus Probable 22,136 30,943 30,292 ------------------------------------------------------------------------- Total Possible 8,290 11,718 13,217 ------------------------------------------------------------------------- Total PPP 30,426 42,661 43,509 ------------------------------------------------------------------------- Approximately 2.64 million barrels of oil (MMBO) was produced from August 1, 2009 to December 31, 2009. Taking the production volume into account, there is an increase in proved and probable reserves associated with the successful drilling and testing of Costayaco-8, Costayaco-9 and Costayaco-10. The reductions in possible reserves are mainly associated with the failure to test oil in Costayaco-7. Argentina Gran Tierra Energy's Argentina year-end 2009 working interest and net after royalty reserves are shown in the following table (NI 51-101 compliant with forecast oil price and cost). Also shown in the following table is Gran Tierra Energy's Argentina net after royalty reserves for year-end 2008 (NI 51-101 compliant with forecast oil price and cost). ------------------------------------------------------------------------- Argentina 2009 Year-End 2009 Year-End 2008 Year-End Light and Medium Oil Gran Tierra Gran Tierra Gran Tierra Energy Energy Energy Working Interest NAR NAR (NI 51-101 compliant) Reserves Reserves Reserves ------------------------------------------------------------------------- Reserves Category MBO MBO MBO ------------------------------------------------------------------------- Proved ------------------------------------------------------------------------- Developed Producing 1,217 1,058 1,144 ------------------------------------------------------------------------- Developed Nonproducing 64 55 249 ------------------------------------------------------------------------- Undeveloped 229 199 181 ------------------------------------------------------------------------- Total Proved 1,510 1,311 1,574 ------------------------------------------------------------------------- Total Probable 982 853 970 ------------------------------------------------------------------------- Total Proved plus Probable 2,492 2,164 2,544 ------------------------------------------------------------------------- Total Possible 2,412 2,105 2,793 ------------------------------------------------------------------------- Total PPP 4,903 4,269 5,337 ------------------------------------------------------------------------- - Gran Tierra Energy had no proved gas reserves in Argentina at year-end 2008; - In addition to the above probable light and medium oil reserves, Gran Tierra Energy also has year-end 2009 NAR probable gas reserves of approximately 1.1 BCF in Argentina. Gran Tierra Energy had year-end 2008 NAR probable gas reserves of approximately 1.2 BCF; - In addition to the above possible light and medium oil reserves, Gran Tierra Energy also has year-end 2009 NAR possible gas reserves of approximately 33.1 BCF in Argentina. Gran Tierra Energy had year-end 2008 NAR possible gas reserves of approximately 14.7 BCF. Current Production Gran Tierra Energy is currently producing approximately 14,800 barrels of oil per day (BOPD) NAR. About 14,000 BOPD NAR production is from Colombia and approximately 800 BOPD NAR production is from Argentina. With the production capacity available from existing wells, Gran Tierra Energy plans to maintain its net after royalty production in Colombia between 13,000 BOPD and 15,000 BOPD independent of any exploration success in 2010. Gran Tierra Energy's net after royalty production rate for Argentina is expected to remain constant at approximately 1,000 barrels of oil equivalent per day (BOEPD) throughout 2010. About Gran Tierra Energy Inc. Gran Tierra Energy Inc. is an international oil and gas exploration and production company, headquartered in Calgary, Canada, incorporated in the United States, trading on the NYSE Amex Exchange (GTE) and the Toronto Stock Exchange (GTE), and operating in South America. Gran Tierra Energy holds interests in producing and prospective properties in Argentina, Colombia and Peru, and has opened a business development office in Rio de Janeiro, Brazil. Gran Tierra Energy has a strategy that focuses on establishing a portfolio of producing properties, plus production enhancement and exploration opportunities to provide a base for future growth. Additional information concerning Gran Tierra Energy is available at http://www.grantierra.com/, on SEDAR (http://www.sedar.com/) and with the Securities and Exchange Commission (http://www.sec.gov/). Cautionary Statements: Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible reserves. The estimate of reserves for individual properties may not reflect the same confidence level as estimates of reserves for all properties, due to the effects of aggregation. A Barrel of oil equivalent (BOE) is calculated using the conversion factor of 6,000 cubic feet ("6Mcf") of natural gas being equivalent to one barrel of oil. BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf per barrel of oil is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Forward-Looking Statements The statements in this press release regarding Gran Tierra Energy's expectations, plans, projections and actions including Gran Tierra Energy's expectations regarding its 2010 exploration drilling campaign and expected funding of the campaign, and expected 2010 NAR production in Colombia and Argentina are "forward-looking statements" within the meaning of the U.S. federal and Canadian securities laws, including Canadian Securities Administrators' National Instrument 51-102 Continuous Disclosure Obligations and the U.S. Private Securities Litigation Reform Act of 1995. Statements containing the words "estimates", "expects", "will", "scheduled", "may", and variations of these words are forward-looking statements. These forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results or outcomes to differ materially from those contemplated by the forward-looking statements. Although Gran Tierra Energy believes that the assumptions underlying, and expectations reflected in, these forward-looking statements are reasonable, it can give no assurance that these assumptions and expectations will prove to be correct. Factors that could cause results to differ materially from those described in the forward-looking statements include: Gran Tierra Energy's operations are located in South America, and unexpected problems can arise due to guerilla activity, technical difficulties and operational difficulties which impact the production, transportation or sale of oil and gas; changing prices for crude oil may cause some scheduled projects or actions to become uneconomical, or may change Gran Tierra Energy's focus to other projects or actions which could be of more benefit to Gran Tierra Energy, which could cause projects or actions currently contemplated to be postponed or cancelled; unexpected problems due to technical difficulties, operational difficulties, and weather conditions; and those other risks found in the periodic reports filed by Gran Tierra Energy with the United States Securities and Exchange Commission, including in the section entitled "Risk Factors" in its Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 5, 2009, and available at the Securities and Exchange Commission's internet site http://www.sec.gov/ and on SEDAR at http://www.sedar.com/. All forward-looking statements in this press release are expressly qualified by information contained in Gran Tierra Energy's filings with regulatory authorities and, subject to its obligations under applicable securities laws, Gran Tierra Energy does not undertake to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. DATASOURCE: Gran Tierra Energy Inc. CONTACT: For media and investor inquiries please contact Jason Crumley, Director, Investor Relations, (403) 265-3221 or

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