Buy
Sell
Share Name Share Symbol Market Type Share ISIN Share Description
Gran Tierra Energy Inc. LSE:GTE London Ordinary Share COM STK USD0.001 (CDI)
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 52.50 50.00 55.00 55.00 52.50 55.00 0.00 08:00:03
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Oil & Gas Producers - - - - 203

Gran Tierra Energy, Inc. Gran Tierra Energy Inc. Announces First Quarter 2021 Results

05/05/2021 2:49am

UK Regulatory (RNS & others)


 
TIDMGTE 
 
 
   -- Achieved First Quarter 2021 Average Production of 24,463 BOPD, Up 12% 
      from Prior Quarter 
 
   -- Increased Current Average Production to 28,200 BOPD 
 
   -- 2020 Sustainability Report Published 
 
   -- Reaffirms 2021 Full-Year Production Guidance of 28,000-30,000 BOPD and 
      Capital of $130-150 Million 
 
   -- Increases 2021 Full-Year Budget Guidance: Cash Flow2 of $205-225 Million, 
      Free Cash Flow2 of $75 Million, EBITDA1 of $255 - $275 Million 
 
 
   CALGARY, Alberta, May 04, 2021 (GLOBE NEWSWIRE) -- Gran Tierra Energy 
Inc. ("Gran Tierra" or the "Company") (NYSE 
American:GTE)(TSX:GTE)(LSE:GTE) today announced the Company's financial 
and operating results for the quarter ended March 31, 2021 ("the 
Quarter"). All dollar amounts are in United States dollars and 
production amounts are on an average working interest before royalties 
("WI") basis unless otherwise indicated. Per barrel ("bbl") amounts are 
based on WI sales before royalties. For per bbl amounts based on net 
after royalty ("NAR") production, see Gran Tierra's Quarterly Report on 
Form 10-Q filed May 4, 2021. 
 
   Message to Shareholders 
 
   Gary Guidry, President and Chief Executive Officer of Gran Tierra, 
commented: "During 2021, we have significantly increased Gran Tierra's 
total production. Our ability to ramp up Gran Tierra's production to the 
highest level in over a year clearly demonstrates our team's success at 
optimizing our core oil fields under waterflood, while preserving and 
maximizing the long-term value of all of our assets. 
 
   Based on our significant progress in increasing production during the 
first quarter of 2021, we reaffirm Gran Tierra's 2021 full-year 
production guidance of 28,000-30,000 bbl/day ('BOPD'). With the strong 
recovery in the Brent oil price, we are also significantly revising 
upwards our 2021 forecasts for cash flow(2) to $205-225 million, free 
cash flow(2) of $75 million and adjusted EBITDA(1) of $255-275 million. 
Our 2021 capital budget of $130-150 million remains a balanced, 
returns-focused program which prioritizes free cash flow(2) generation 
and debt reduction. The significant free cash flow(2) that we now 
forecast for 2021 is expected to allow us to further accelerate debt 
reduction through the remainder of 2021, with our projected bank credit 
facility balance decreasing to $70-90 million by December 31, 2021. We 
also continue to advance exploration-related activities for our 
prioritized, high impact exploration program and we expect to increase 
activity in 2022. 
 
   In the second half of 2021, funds flow from operations(1) and free cash 
flow(2) is expected to accelerate as production increases and our first 
half 2021 hedges roll off and are replaced with hedges with much higher 
prices. Our first half 2021 Brent hedges on 15,000 BOPD had an average 
floor of $45.13/bbl and ceiling of $51.38/bbl, whereas our second half 
2021 hedges on 10,000 BOPD have an average floor of $57.03/bbl and 
ceiling of $65.29/bbl. During the second half of 2021, we expect the 
Company to generate funds flow from operations(1) of $130-150 million 
and adjusted EBITDA(1) of $155-175 million. 
 
   Our teams in Colombia, Canada and Ecuador have done an excellent job by 
safely and effectively executing our development program during the many 
challenges faced by Gran Tierra and our industry in 2020 and 2021. The 
health and safety of our people and all of our stakeholders where we 
operate will continue to be a focus in 2021 through our industry-leading 
COVID-19 safety practices and protocols. 
 
   Gran Tierra has been moving at a rapid pace over the last five years, 
integrating multiple acquisitions into our organization, building a 
portfolio of high-quality assets and strengthening our team. Throughout 
2020 and into 2021, our sustainability guiding principle of going 
'Beyond Compliance' has been a top priority for our team which was 
focused on maximizing the Company's environmental and social 
contributions even during challenging times. We also continued to make 
progress on our signature programs and to focus not only on being an 
excellent partner to communities, but also on leaving a permanent legacy 
of environmental protection in the regions where we work. We are pleased 
to share with you Gran Tierra's many accomplishments from the past year 
in our 2020 Sustainability Report here: www.grantierra.com/ESG2020. We 
are excited to keep building for tomorrow by creating long-term value 
and delivering on our Environmental, Social and Governance commitments 
today." 
 
   Key Highlights: 
 
 
   -- Production: The Quarter's production averaged 24,463 BOPD, up 12% from 
      fourth quarter 2020 ("the Prior Quarter "); Gran Tierra's average 
      production for various time periods is outlined in the table below: 
 
 
 
 
                       Acordionero  Costayaco  Moqueta   Other   Total Company 
 Average Production       (BOPD)      (BOPD)    (BOPD)   (BOPD)      (BOPD) 
---------------------  -----------  ---------  -------  -------  ------------- 
Second Quarter 2020         10,744      6,021    2,468      932         20,165 
---------------------  -----------  ---------  -------  -------  ------------- 
Third Quarter 2020           9,696      4,949    2,051    2,248         18,944 
---------------------  -----------  ---------  -------  -------  ------------- 
Fourth Quarter 2020          9,732      4,363    2,530    5,282         21,907 
---------------------  -----------  ---------  -------  -------  ------------- 
First Quarter 2021          12,681      4,190    2,304    5,288         24,463 
---------------------  -----------  ---------  -------  -------  ------------- 
Current Average 
 Production(*)              16,000      4,700    2,400    5,100         28,200 
---------------------  -----------  ---------  -------  -------  ------------- 
 
 
   (*) Approximate average production over the 5-week period from March 30, 
2021 to May 3, 2021. 
 
 
   -- 2021 Production Guidance: Based on the Company's significant progress in 
      increasing production during and subsequent to the Quarter, Gran Tierra 
      reaffirms its 2021 full-year production guidance of 28,000-30,000 BOPD 
 
   -- 2020 Sustainability Report: 
 
          -- Gran Tierra is pleased to share its ESG accomplishments from the 
             past year, including a 60% reduction in the Company's greenhouse 
             gas emissions from 2019, in its "2020 Sustainability Report: 
             Creating long-term value and delivering on our Environmental, 
             Social and Governance commitments"; please read the report here: 
             www.grantierra.com/ESG2020 
 
          -- The public health crisis of 2020 created critical challenges 
             around the world and as soon as the extent of the COVID-19 
             pandemic became clear, Gran Tierra's foremost concerns were 
             protecting the health and safety of the Company's workers and the 
             communities near its operations 
 
          -- Gran Tierra implemented a comprehensive set of health and safety 
             protocols which allowed the Company to continue operations, as 
             well as make progress on its signature ESG programs in Colombia, 
             including strengthening the cacao sector, rainforest reforestation 
             and conservation, removing land mines and protecting vulnerable 
             children 
 
   -- Key Financial Metrics for the Quarter: 
 
          -- Significant Cost Reductions: Compared to the first quarter of 
             2020, the Company's operating expenses were down 19% to $13.65/bbl, 
             quality and transportation discount was down 30% to $8.98/bbl and 
             transportation expenses were down 24% to $1.15/bbl; the majority 
             of these cost reductions represent structural improvements in the 
             Company's operations, which are expected to be maintained as oil 
             prices recover further; general and administrative ("G&A") 
             expenses before stock-based compensation decreased by 21% compared 
             to the first quarter of 2020 as a result of continued cost savings 
             measures primarily relating to lower consulting, legal, general 
             office and travel expenses 
 
          -- Credit Facility Paid Down and Cash Balance Increased: At March 31, 
             2021, the Company had paid down its credit facility balance by $10 
             million to $180 million and increased its cash and cash 
             equivalents balance to $22 million, compared to a credit facility 
             balance of $190 million and cash and cash equivalents balance of 
             $14 million at the end of the Prior Quarter 
 
          -- Narrowed Net Loss and Increased EBITDA: Relative to the Prior 
             Quarter, Gran Tierra significantly narrowed its realized net loss 
             by 22% to $37 million; EBITDA1 also substantially improved to $16 
             million, up from $(14) million in the Prior Quarter 
 
          -- Increased Adjusted EBITDA and Funds Flow: Relative to the Prior 
             Quarter, the Company substantially improved both its Adjusted 
             EBITDA1, which was up 88% to $42 million, and its funds flow from 
             operations1, which was up 224% to $29 million 
 
          -- Substantial Increases in Oil Sales and Operating Netback: The 
             Brent oil price averaged $61.32/bbl and Gran Tierra generated oil 
             sales of $95 million, up 47% or $31 million from the Prior Quarter, 
             driven by a combination of the 12% increase in production and the 
             35% increase in the Brent oil price; the Company's operating 
             netback1 of $29.20/bbl was up 65%, an increase of $11.53/bbl 
             relative to the Prior Quarter; this improvement was achieved 
             despite an increase in royalties to $8.34/bbl, up from the Prior 
             Quarter's $3.92/bbl, as a result of higher oil prices 
 
          -- Capital Expenditures: The Quarter's expenditures of approximately 
             $37 million were down modestly from the Prior Quarter's level of 
             $40 million, as Gran Tierra pressed ahead with development 
             drilling operations at the Acordionero and Costayaco oil fields; 
             the Company expects approximately 65-75% of its 2021 capital 
             program of $130-150 million to be spent during the first half of 
             2021 
 
          -- Closing of Sale of PetroTal Shares: As previously announced, Gran 
             Tierra Resources Limited ("GTRL"), a wholly owned subsidiary of 
             Gran Tierra, sold an aggregate of 109,006,250 common shares of 
             PetroTal Corp. ("PetroTal") for an aggregate purchase price of 
             approximately $15 million; as of market close on May 3, 2021, the 
             remaining 137,093,750 shares of PetroTal owned by GTRL had a 
             market value of approximately $29 million. 
 
          -- Oil Price Hedges In Place Designed To Protect Cash Flows During 
             Second Half 2021: The Company has the following oil price hedges 
             in place, including hedges covering 10,000 BOPD in second half 
             2021 with a weighted average floor price of $57.03/bbl and a 
             weighted average ceiling price of $65.29/bbl (realized oil price 
             hedging losses totaled $13 million during the Quarter): 
 
 
 
 
Period and 
type of      Volume,                      Sold Put                 Purchased Put                 Sold Call                    Premium 
instrument     BOPD   Reference   ($/bbl, Weighted Average)   ($/bbl, Weighted Average)   ($/bbl, Weighted Average)   ($/bbl, Weighted Average) 
-----------  -------  ---------  --------------------------  --------------------------  --------------------------  -------------------------- 
Three-way 
 Collars: 
 April 1, 
 to June 
 30, 2021     14,000  ICE Brent                       36.43                       45.14                       51.45                        0.21 
-----------  -------  ---------  --------------------------  --------------------------  --------------------------  -------------------------- 
Collars: 
 April 1, 
 to June 
 30, 2021      1,000  ICE Brent                         n/a                       45.00                       50.40                         n/a 
-----------  -------  ---------  --------------------------  --------------------------  --------------------------  -------------------------- 
Three-way 
 Collars: 
 July 1, to 
 December 
 31, 2021      4,000  ICE Brent                       45.00                       55.00                       68.00                         n/a 
-----------  -------  ---------  --------------------------  --------------------------  --------------------------  -------------------------- 
Three-way 
 Collars: 
 July 1, to 
 December 
 31, 
 2021(#)       3,000  ICE Brent                       50.00                       60.00                       70.21                         n/a 
-----------  -------  ---------  --------------------------  --------------------------  --------------------------  -------------------------- 
Swaptions: 
 July 1, to 
 December 
 31, 2021      3,000  ICE Brent                         n/a                         n/a                       56.75                         n/a 
-----------  -------  ---------  --------------------------  --------------------------  --------------------------  -------------------------- 
 
 
   (#) Entered into subsequent to the end of the Quarter. 
 
   2021 Revised Guidance 
 
 
   -- Due to the strong rebound in the Brent oil price during 2021, Gran Tierra 
      is revising some of the Company's forecast ranges for its 2021 budget: 
 
 
 
 
                                                           Original 
                                                         Budget (Base      Revised 
2021 Guidance                                                Case)         Budget 
-------------------------------------------------------  -------------  ------------- 
Annual Average Brent Oil Price ($/bbl)                           49.00          61.00 
-------------------------------------------------------  -------------  ------------- 
Total Company Production (BOPD)                          28,000-30,000  28,000-30,000 
-------------------------------------------------------  -------------  ------------- 
Operating Netback(1) ($ million)                               220-240        310-330 
-------------------------------------------------------  -------------  ------------- 
EBITDA(1) ($ million)                                          200-220        255-275 
-------------------------------------------------------  -------------  ------------- 
Cash Flow(2) ($ million)                                       150-170        205-225 
-------------------------------------------------------  -------------  ------------- 
Total Capital ($ million)                                      130-150        130-150 
-------------------------------------------------------  -------------  ------------- 
Free Cash Flow(2) ($ million)                                      20^            75^ 
-------------------------------------------------------  -------------  ------------- 
Bank Credit Facility Balance @ December 31, 2021 ($ 
 million)                                                      125-145          70-90 
-------------------------------------------------------  -------------  ------------- 
2021 Year-End Net Debt(4) to Annualized Fourth Quarter 
 2021 EBITDA(1)                                                2.7-2.9        1.9-2.1 
-------------------------------------------------------  -------------  ------------- 
Number of Development Wells (gross)                              14-18          14-18 
-------------------------------------------------------  -------------  ------------- 
 
 
   (^) Calculated by subtracting midpoint of total capital from midpoint of 
cash flow. Free cash flow forecast for Original Budget (Base Case) was 
not previously disclosed. 
 
 
   -- 2021 Capital Program: Gran Tierra plans to direct approximately 60% of 
      the 2021 capital program toward continued development of the Acordionero 
      field in the Middle Magdalena Valley Basin, another 35% toward 
      development activities in the Putumayo Basin and the remaining 5% toward 
      exploration-related activities throughout the Company's portfolio, in 
      both Colombia and Ecuador 
 
   -- Fully Funded Capital Program: the 2021 capital budget of $130-150 million 
      is expected to be more than fully funded from the revised 2021 cash flow2 
      forecast of $205-225 million 
 
   -- Control of Capital Program: Gran Tierra has 100% working interest in and 
      operatorship of the Company's major assets in Colombia and Ecuador; this 
      full control gives the Company the flexibility to optimize its 
      development and exploration programs with changes, either up or down, in 
      oil prices 
 
   -- Debt Reduction: with 2021 expected free cash flow2 and changes in 
      non-cash working capital (primarily related to the ongoing collection of 
      tax receivables), Gran Tierra now expects its bank credit facility to be 
      paid down in the Revised Budget to a balance of $70-90 million by 
      December 31, 2021 
 
   -- Gran Tierra is also revising the Company's forecast 2021 ranges for 
      operating netback3 per bbl and some expenses: 
 
 
 
 
                                        Original Budget 
2021 Guidance                             (Base Case)    Revised Budget 
--------------------------------------  ---------------  -------------- 
Brent Oil Price ($/bbl)                           49.00           61.00 
--------------------------------------  ---------------  -------------- 
Expenses ($/bbl) 
--------------------------------------  ---------------  -------------- 
  Transportation and Quality Discount        8.00-10.00      8.00-10.00 
--------------------------------------  ---------------  -------------- 
  Royalties                                   5.00-6.00       8.00-9.00 
--------------------------------------  ---------------  -------------- 
Oil and Gas Sales Price ($/bbl)             34.00-36.00     42.00-44.00 
--------------------------------------  ---------------  -------------- 
  Operating Costs                           11.00-13.00     11.00-13.00 
--------------------------------------  ---------------  -------------- 
  Transportation (Pipeline)                   0.80-1.00       0.90-1.10 
--------------------------------------  ---------------  -------------- 
Operating Netback(3) ($/bbl)                21.00-23.00     29.00-31.00 
--------------------------------------  ---------------  -------------- 
  General and Administrative                  1.50-2.50       1.50-2.50 
--------------------------------------  ---------------  -------------- 
  Interest and Financing                      4.50-5.00       4.50-5.00 
--------------------------------------  ---------------  -------------- 
  Taxes                                            0.00            0.00 
--------------------------------------  ---------------  -------------- 
 
 
   Operations Update 
 
 
   -- Acordionero Oil Field (100% WI) 
 
          -- Utilizing 2 workover rigs, Gran Tierra continues to workover wells 
             that went offline in 2020, which the Company decided not to 
             workover at that time due to low oil prices; during the current 
             workover campaign, the average workover cost has decreased 28% 
             from 2019 
 
          -- The development drilling rig has also remained active since 
             starting on November 30, 2020, drilling both producers and 
             injectors; the average cost per well has decreased 36% since 2019; 
             the AC-75 well achieved a new record cycle time from spud to 
             on-production of 10.6 days, at a total cost of $1.9 million 
 
          -- From January 1 to May 3, 2021, Gran Tierra has drilled 11 new oil 
             wells and 2 new water injection wells 
 
          -- The combination of the workover and drilling programs has resulted 
             in Acordionero's approximate current average production5 of 16,000 
             BOPD 
 
          -- Acordionero's current average production is the highest level 
             achieved since June 20195; Gran Tierra believes its prudent 
             reservoir management of Acordionero's waterflood has allowed the 
             Company to restore this field's production to a level last 
             achieved 22 months ago, which strongly demonstrates the 
             effectiveness of the waterflood 
 
 
   -- Costayaco Oil Field (100% WI) 
 
          -- In March 2021, Gran Tierra commenced its infill development 
             drilling campaign to drill 3 oil producers; this drilling program 
             is the first in Costayaco since November 2019 
 
          -- The CYC-42 and CYC-43 infill oil wells were drilled during March 
             and April of 2021 with indications of high quality reservoir in 
             the U, T, and Caballos Sands based on well logs, with potential 
             prospectivity in the M2 Carbonate; the 2 wells were drilled in an 
             average of 12 days at a cost of $1.9 million per well, a 30% 
             decrease from the last 4 wells drilled in Costayaco 
 
          -- Drilling commenced on the CYC-44 infill well on April 26, 2021 
 
          -- All 3 wells are expected to be on production by the end of the 
             second quarter of 2021; currently none of the wells are on 
             production 
 
   -- Moqueta Oil Field (100% WI) 
 
          -- During the second quarter of 2021, Gran Tierra plans a 6-well 
             workover program, which is expected to consist of 2 workovers and 
             1 stimulation to restore production, and also 3 injector 
             conversions to further optimize the waterflood and increase 
             production in the second half of 2021 
 
   -- Suroriente Block (52% WI and Operator) 
 
          -- At the Cohembi oil field in the Suroriente Block, a facility 
             expansion program is progressing as planned, which is expected to 
             allow additional production to be brought online in the second 
             half of 2021 
 
          -- A workover rig is scheduled to arrive in the Suroriente Block 
             during May 2021, where it is expected to accelerate the running of 
             larger pumps in 2 oil wells and to restore production in 3 oil 
             wells which are currently offline 
 
 
   Financial and Operational Highlights (all amounts in $000s, except per 
share and bbl amounts) 
 
 
 
 
                                                                                            Three Months 
                                                                                           Ended December 
                                                            Three Months Ended March 31,        31, 
                                                                2021           2020             2020 
                                                            -------------  -------------  ---------------- 
 
Net Loss                                                    $(37,422)      $(251,626)     $(47,871) 
  Per Share - Basic and Diluted                             $  (0.10)      $   (0.69)     $  (0.13) 
 
Oil Sales                                                   $ 95,493       $  86,079      $ 64,793 
Operating Expenses                                           (29,625)        (44,588)      (27,215) 
Transportation Expenses                                       (2,506)         (4,037)       (1,994) 
                                                            --------       ---------      -------- ----- 
Operating Netback(1)(3)                                     $ 63,362       $  37,454      $ 35,584 
                                                             =======  ===   ========       =======  ====== 
 
G&A Expenses Before Stock-Based Compensation                $  5,898       $   7,440      $  5,323 
G&A Stock-Based Compensation Expense (Recovery)                3,671          (2,055)        1,923 
                                                            --------  ---  ---------      --------  ------ 
G&A Expenses, Including Stock Based Compensation            $  9,569       $   5,385      $  7,246 
                                                             =======  ===   ========       =======  ====== 
 
Adjusted EBITDA(1)                                          $ 41,904       $  34,491      $ 22,235 
 
Funds Flow from Operations(1)                               $ 28,973       $  22,227      $  8,956 
 
Capital Expenditures                                        $ 37,427       $  44,277      $ 39,903 
 
Average Daily Volumes (BOPD) 
---------------------------------------------------------- 
WI Production Before Royalties                                24,463          29,527        21,907 
Royalties                                                     (3,930)         (4,156)       (2,411) 
                                                            --------       ---------      -------- ----- 
Production NAR                                                20,533          25,371        19,496 
Decrease (Increase) in Inventory                                (262)           (521)           15 
                                                            --------       ---------      --------  ------ 
Sales                                                         20,271          24,850        19,511 
                                                            ========  ===  =========      ========  ====== 
Royalties, % of WI Production Before Royalties                    16%             14%           11% 
 
Per bbl 
---------------------------------------------------------- 
Brent                                                       $  61.32       $   50.82      $  45.26 
Quality and Transportation Discount                            (8.98)         (12.75)        (9.17) 
Royalties                                                      (8.34)          (5.61)        (3.92) 
                                                            --------       ---------      -------- ----- 
Average Realized Price                                         44.00           32.46         32.17 
Transportation Expenses                                        (1.15)          (1.52)        (0.99) 
                                                            --------       ---------      -------- ----- 
Average Realized Price Net of Transportation Expenses          42.85           30.94         31.18 
Operating Expenses                                            (13.65)         (16.81)       (13.51) 
Operating Netback(1)(3)                                        29.20           14.13         17.67 
COVID-19 costs                                                 (0.52)             --         (0.57) 
G&A Expenses Before Stock-Based Compensation                   (2.72)          (2.81)        (2.64) 
Severance Expenses                                             (0.42)          (0.50)        (0.08) 
Realized Foreign Exchange (Loss) Gain                          (0.04)           0.75         (0.57) 
Cash Settlements on Derivative Instruments                     (6.18)           1.31         (2.53) 
Interest Expense, Excluding Amortization of Debt Issuance 
 Costs                                                         (5.96)          (4.51)        (6.50) 
Interest Income                                                   --            0.13            -- 
Other Loss                                                        --              --         (0.20) 
Net Lease Payments                                             (0.01)          (0.01)        (0.03) 
Current Income Tax Expense                                        --           (0.11)        (0.10) 
                                                            --------  ---  ---------      -------- ----- 
Cash Netback(1)                                             $  13.35       $    8.38      $   4.45 
                                                             =======  ===   ========       =======  ====== 
 
Share Information (000s) 
---------------------------------------------------------- 
Common Stock Outstanding, End of Period                        366,982        366,982         366,982 
Weighted Average Number of Common and Exchangeable 
 Shares Outstanding - Basic and Diluted                        366,982        366,982         366,982 
                                                            -------------  -------------  ---------------- 
 
   (1) Funds flow from operations, operating netback, cash netback, 
earnings before interest, taxes and depletion, depreciation and 
accretion ("DD&A") ("EBITDA") and EBITDA adjusted for goodwill 
impairment, asset impairment, non-cash lease expense, lease payments, 
unrealized foreign exchange gains or losses, stock based compensation 
expense, unrealized derivative instruments gains or losses and other 
financial instruments gains or losses ("Adjusted EBITDA") are non-GAAP 
measures and do not have standardized meanings under generally accepted 
accounting principles in the United States of America ("GAAP"). Refer to 
"Non-GAAP Measures" in this press release for descriptions of these 
non-GAAP measures and reconciliations to the most directly comparable 
measures calculated and presented in accordance with GAAP. 
 
   (2) Cash flow refers to the GAAP line item "net cash provided by 
operating activities". Free cash flow is a non-GAAP measure and does not 
have a standardized meaning under GAAP and is defined as the midpoint of 
projected 2021 cash flow less the midpoint of projected 2021 capital 
spending. Refer to "Non-GAAP Measures" in this press release. 
 
   (3) Operating netback as presented is defined as oil sales less 
operating and transportation expenses. See the table titled Financial 
and Operational Highlights above for the components of consolidated 
operating netback and corresponding reconciliation. 
 
   (4) Net Debt as presented in the context of 2021 guidance is defined as 
projected working capital at December 31, 2021, less $600 million in 
senior notes and borrowings under the credit facility. Management 
believes that net debt is a useful supplemental measure for management 
and investors to in order to evaluate the financial sustainability of 
the Company's business and leverage. The most directly comparable GAAP 
measure is total debt. Gran Tierra is unable to provide a quantitative 
reconciliation of forward-looking net debt to its most directly 
comparable forward-looking GAAP measure because management cannot 
reliably predict certain of the necessary components of such 
forward-looking GAAP measure. 
 
   (5) Approximate average production over the 5-week period from March 30 
to May 3, 2021, which is the highest 5-week average rate for Acordionero 
since June 2019. 
 
   Virtual Annual Meeting of Stockholders: 
 
   Gran Tierra's 2021 Annual Meeting of Stockholders will be held virtually 
on Wednesday, May 5, 2021 at 1:30 p.m. (Mountain Time). In light of the 
COVID-19 pandemic and to mitigate the risks to the health and safety of 
our community, stockholders and employees, Gran Tierra will be holding 
its annual meeting in a virtual-only format by way of webcast and no 
physical or in-person meeting will be held. 
 
   How to Participate in the Virtual Annual Meeting 
 
   To access the virtual meeting, please go to 
www.meetingcenter.io/296994452. We recommend that you log in 15 minutes 
before the Annual Meeting starts. To log into the Annual Meeting you 
will have the option to join as a "Guest" or join as a "Shareholder". If 
you join as a "Shareholder", you will be able to vote your shares and 
ask questions during the Annual Meeting. In order to join as a 
"Shareholder," you are required to have the password and your control 
number. The password for the meeting is GTRE2021 and the control number 
can be found on the form of proxy or notice. Guests and non-registered 
(beneficial) shareholders who have not duly appointed themselves as 
proxyholder will be able to attend the Annual Meeting at the link above 
by providing the guest login information but will not be able to vote or 
ask questions at the meeting. 
 
   Full details on how to vote, change or revoke a vote, appoint a 
proxyholder, attend the virtual Annual Meeting, ask questions and other 
general proxy matters are available in the proxy statement dated March 
25, 2021 available on the Company's website or the sec.gov website. 
 
   Whether or not you plan to attend the Annual Meeting, we urge you to 
vote and submit your proxy in advance of the Annual Meeting by one of 
the methods described in the proxy materials for the Annual Meeting. 
 
   Please note that since the Gran Tierra's Annual Meeting is scheduled for 
the day after the Company releases its 2021 first quarter financial and 
operating results, Gran Tierra will not have a quarterly conference call 
since the same material will be discussed at the Annual Meeting. 
 
   Corporate Presentation: 
 
   Gran Tierra's Corporate Presentation has been updated and is available 
on the Company website at www.grantierra.com. 
 
   Contact Information 
 
   For investor and media inquiries please contact: 
 
   Gary Guidry 
 
   President & Chief Executive Officer 
 
   Ryan Ellson 
 
   Executive Vice President & Chief Financial Officer 
 
   Rodger Trimble 
 
   Vice President, Investor Relations 
 
   +1-403-265-3221 
 
   info@grantierra.com 
 
   About Gran Tierra Energy Inc. 
 
   Gran Tierra Energy Inc. together with its subsidiaries is an independent 
international energy company currently focused on oil and natural gas 
exploration and production in Colombia and Ecuador. The Company is 
currently developing its existing portfolio of assets in Colombia and 
Ecuador and will continue to pursue additional growth opportunities that 
would further strengthen the Company's portfolio. The Company's common 
stock trades on the NYSE American, the Toronto Stock Exchange and the 
London Stock Exchange under the ticker symbol GTE. Additional 
information concerning Gran Tierra is available at www.grantierra.com. 
Information on the Company's website (including the Sustainability 
Report) does not constitute a part of this press release. Investor 
inquiries may be directed to info@grantierra.com or (403) 265-3221. 
 
   Gran Tierra's Securities and Exchange Commission filings are available 
on the SEC website at http://www.sec.gov and on SEDAR at 
http://www.sedar.com and UK regulatory filings are available on the 
National Storage Mechanism website at 
https://data.fca.org.uk/#/nsm/nationalstoragemechanism. 
 
   Forward-Looking Statements and Legal Advisories: 
 
   This press release contains opinions, forecasts, projections, 
expectations and other statements about future events or results that 
constitute forward-looking statements within the meaning of the United 
States Private Securities Litigation Reform Act of 1995, Section 27A of 
the Securities Act of 1933, as amended, and Section 21E of the 
Securities Exchange Act of 1934, as amended, and financial outlook and 
forward-looking information within the meaning of applicable Canadian 
securities laws (collectively, "forward-looking statements"). The use of 
the words "believe", "expect", "anticipate", "intend", "estimate", 
"project" "forecast", "guidance", "target", "goal", "plan", "budget" 
"objective", "could", "should", and other terms identify forward-looking 
statements. In particular, but without limiting the foregoing, this 
press release contains forward-looking statements regarding: the 
Company's 2021 outlook and guidance, including estimates of future 
production, EBITDA, net cash provided by operating activities (described 
in this press release as "cash flow"), free cash flow, operating netback, 
net debt, total capital and certain associated metrics; expectations 
regarding its capital program, liquidity, including the ability to pay 
down the credit facility, and access to capital; strategies related to 
drilling and operational activities and expectations regarding well 
performance, production and workover activities; the benefits of reduced 
capital spending and G&A expenses; the benefits of derivative 
transactions and expectations regarding future oil prices; ESG-related 
efforts and impacts; the Company's operations including planned 
operations, the use and the availability of certain tax refunds and 
credits, and the impact of the COVID-19 pandemic, disruptions to 
operations and the decline in industry conditions. 
 
   Among the important factors that could cause actual results to differ 
materially from those indicated by the forward-looking statements in 
this press release are: the unprecedented impact of the COVID-19 
pandemic and the actions of OPEC and non-OPEC countries and the 
procedures imposed by governments in response thereto; disruptions to 
local operations; the decline and volatility in oil and gas industry 
conditions and commodity prices; the severe imbalance in supply and 
demand for oil and natural gas; prices and markets for oil and natural 
gas are unpredictable and volatile; the accuracy of productive capacity 
of any particular field; the timing and impact of any resumption of 
operations; Gran Tierra's operations are located in South America and 
unexpected problems can arise due to guerilla activity or local 
blockades or protests; technical difficulties and operational 
difficulties may arise which impact the production, transport or sale of 
our products; geographic, political and weather conditions can impact 
the production, transport or sale of our products; the ability of Gran 
Tierra to execute its business plan and realize expected benefits from 
current initiatives (including a reduction of the capital program); the 
risk that unexpected delays and difficulties in developing currently 
owned properties may occur; the ability to replace reserves and 
production and develop and manage reserves on an economically viable 
basis; the accuracy of testing and production results and seismic data, 
pricing and cost estimates (including with respect to commodity pricing 
and exchange rates); the risk profile of planned exploration activities; 
the effects of drilling down-dip; the effects of waterflood and 
multi-stage fracture stimulation operations; the extent and effect of 
delivery disruptions, equipment performance and costs; actions by third 
parties; the timely receipt of regulatory or other required approvals 
for our operating activities; the failure of exploratory drilling to 
result in commercial wells; unexpected delays due to the limited 
availability of drilling equipment and personnel; the risk that current 
global economic and credit market conditions may impact oil prices and 
oil consumption more than Gran Tierra currently predicts, which could 
cause Gran Tierra to further modify its strategy and capital spending 
program; volatility or declines in the trading price of our common stock 
or bonds; the risk that Gran Tierra does not receive the anticipated 
benefits of government programs, including government tax refunds; Gran 
Tierra's ability to comply with financial covenants in its credit 
agreement and indentures and make borrowings under its credit agreement; 
and the risk factors detailed from time to time in Gran Tierra's 
periodic reports filed with the Securities and Exchange Commission, 
including, without limitation, under the caption "Risk Factors" in Gran 
Tierra's Annual Report on Form 10-K for the year ended December 31, 
2020, many of which are beyond the Company's control. These filings are 
available on the SEC website at http://www.sec.gov and on SEDAR at 
www.sedar.com. 
 
   The forward-looking statements contained in this press release are based 
on certain assumptions made by Gran Tierra based on management's 
experience and other factors believed to be appropriate. Gran Tierra 
believes these assumptions to be reasonable at this time, but the 
forward-looking statements are subject to risk and uncertainties, many 
of which are beyond Gran Tierra's control, which may cause actual 
results to differ materially from those implied or expressed by the 
forward looking statements. The risk that the assumptions on which the 
2021 outlook and guidance are based prove incorrect may increase the 
later the period to which the outlook relates. In particular, the 
unprecedented nature of the current economic downturn, pandemic and 
industry decline may make it particularly difficult to identify risks or 
predict the degree to which identified risks will impact Gran Tierra's 
business and financial condition. All forward-looking statements are 
made as of the date of this press release and the fact that this press 
release remains available does not constitute a representation by Gran 
Tierra that Gran Tierra believes these forward-looking statements 
continue to be true as of any subsequent date. Actual results may vary 
materially from the expected results expressed in forward-looking 
statements. Gran Tierra disclaims any intention or obligation to update 
or revise any forward-looking statements, whether as a result of new 
information, future events or otherwise, except as expressly required by 
applicable law. 
 
   The estimates of future production, EBITDA, net cash provided by 
operating activities (described in this press release as "cash flow"), 
free cash flow, operating netback, net debt, total capital and certain 
expenses or costs may be considered to be future-oriented financial 
information or a financial outlook for the purposes of applicable 
Canadian securities laws. Financial outlook and future-oriented 
financial information contained in this press release about prospective 
financial performance, financial position or cash flows are provided to 
give the reader a better understanding of the potential future 
performance of the Company in certain areas and are based on assumptions 
about future events, including economic conditions and proposed courses 
of action, based on management's assessment of the relevant information 
currently available, and to become available in the future. 
 
   In particular, this press release contains projected operational and 
financial information for 2021. These projections contain 
forward-looking statements and are based on a number of material 
assumptions and factors, including those set out above. Actual results 
may differ significantly from the projections presented herein. The 
actual results of Gran Tierra's operations for any period could vary 
from the amounts set forth in these projections, and such variations may 
be material. See above for a discussion of the risks that could cause 
actual results to vary. 
 
   The future-oriented financial information and financial outlooks 
contained in this press release have been approved by management as of 
the date of this press release. Readers are cautioned that any such 
financial outlook and future-oriented financial and operational 
information contained herein should not be used for purposes other than 
those for which it is disclosed herein. The Company and its management 
believe that the prospective financial information has been prepared on 
a reasonable basis, reflecting management's best estimates and judgments, 
and represent, to the best of management's knowledge and opinion, the 
Company's expected course of action. However, because this information 
is highly subjective, it should not be relied on as necessarily 
indicative of future results. 
 
   Non-GAAP Measures 
 
   This press release includes non-GAAP financial measures as further 
described herein. These non-GAAP measures do not have a standardized 
meaning under GAAP. Investors are cautioned that these measures should 
not be construed as alternatives to net income or loss or other measures 
of financial performance as determined in accordance with GAAP. Gran 
Tierra's method of calculating these measures may differ from other 
companies and, accordingly, they may not be comparable to similar 
measures used by other companies. Each non-GAAP financial measure is 
presented along with the corresponding GAAP measure so as to not imply 
that more emphasis should be placed on the non-GAAP measure. 
 
   Operating netback as presented is defined as oil sales less operating 
and transportation expenses. See the table entitled Financial and 
Operational Highlights above for the components of consolidated 
operating netback and corresponding reconciliation. 
 
   Cash netback as presented is defined as net loss adjusted for depletion, 
depreciation and accretion ("DD&A") expenses, goodwill impairment, asset 
impairment, deferred tax expense or recovery, stock-based compensation 
expense or recovery, amortization of debt issuance costs, non-cash lease 
expense, lease payments, unrealized foreign exchange gains or losses, 
derivative instruments gains or losses, cash settlements on derivative 
instruments and other financial instruments gains or losses. Management 
believes that operating netback and cash netback are useful supplemental 
measures for investors to analyze financial performance and provide an 
indication of the results generated by Gran Tierra's principal business 
activities prior to the consideration of other income and expenses. A 
reconciliation from net loss to cash netback is as follows: 
 
 
 
 
                                                     Three Months Ended 
                    Three Months Ended March 31,        December 31, 
                  --------------------------------  -------------------- 
Cash Netback - 
(Non-GAAP) 
Measure ($000s)          2021             2020              2020 
                  ------------------  ------------  -------------------- 
Net loss           $     (37,422)     $  (251,626)     $    (47,871) 
Adjustments to 
reconcile net 
loss to cash 
netback 
   DD&A expenses          31,318           57,294            33,115 
   Goodwill 
   impairment                 --          102,581                -- 
   Asset 
    impairment                --            3,904            57,402 
   Deferred tax 
    expense 
    (recovery)             8,651           34,606           (13,352) 
   Stock-based 
    compensation 
    expense 
    (recovery)             3,671           (2,055)            1,923 
   Amortization 
    of debt 
    issuance 
    costs                    881              844               851 
   Non-cash 
    lease 
    expense                  444              490               457 
   Lease 
    payments                (462)            (515)             (522) 
   Unrealized 
    foreign 
    exchange 
    loss (gain)           13,003           20,799           (17,064) 
   Derivative 
    instruments 
    loss (gain)           23,698          (12,867)           12,354 
   Cash 
    settlements 
    on 
    derivative 
    instruments          (13,404)           3,487            (5,096) 
   Other 
    financial 
    instruments 
    (gain) loss           (1,405)          65,285           (13,241) 
Cash netback       $      28,973      $    22,227      $      8,956 
                      ==========       ==========   ====  =========  === 
 
 
   EBITDA, as presented, is defined as net loss adjusted for DD&A expenses, 
interest expense and income tax expense or recovery. Adjusted EBITDA, as 
presented, is defined as EBITDA adjusted for goodwill impairment, asset 
impairment, non-cash lease expense, lease payments, unrealized foreign 
exchange gains or losses, stock based compensation expense or recovery, 
unrealized derivative instruments gains or losses and other financial 
instruments gains or losses. Management uses this supplemental measure 
to analyze performance and income generated by our principal business 
activities prior to the consideration of how non-cash items affect that 
income, and believes that this financial measure is useful supplemental 
information for investors to analyze our performance and our financial 
results. A reconciliation from net income or loss to EBITDA and adjusted 
EBITDA is as follows: 
 
 
 
 
                                                                                     Three Months 
                                                           Three Months Ended March      Ended 
                                                                     31,             December 31, 
                                                           ------------------------  ------------- 
EBITDA - (Non-GAAP) Measure ($000s)                            2021         2020         2020 
                                                           ------------  ----------  ------------- 
Net loss                                                   $(37,422)     $(251,626)  $(47,871) 
Adjustments to reconcile net loss to EBITDA and Adjusted 
 EBITDA 
   DD&A expenses                                             31,318         57,294     33,115 
   Interest expense                                          13,812         12,810     13,936 
   Income tax expense (recovery)                              8,651         34,904    (13,158) 
                                                           --------      ---------   -------- 
EBITDA                                                     $ 16,359      $(146,618)  $(13,978) 
                                                            -------       --------    ------- 
   Goodwill impairment                                           --        102,581         -- 
   Asset impairment                                              --          3,904     57,402 
   Non-cash lease expense                                       444            490        457 
   Lease payments                                              (462)          (515)      (522) 
   Unrealized foreign exchange loss (gain)                   13,003         20,799    (17,064) 
   Stock-based compensation expense (recovery)                3,671         (2,055)     1,923 
   Unrealized derivative instruments loss (gain)             10,294         (9,380)     7,258 
   Other financial instruments (gain) loss                 $ (1,405)     $  65,285   $(13,241) 
                                                            -------       --------    ------- 
Adjusted EBITDA                                            $ 41,904      $  34,491   $ 22,235 
                                                            =======       ========    =======  === 
 
 
   Funds flow from operations, as presented, is defined as net loss 
adjusted for DD&A expenses, goodwill impairment, asset impairment, 
deferred tax expense or recovery, stock-based compensation expense or 
recovery, amortization of debt issuance costs, non-cash lease expense, 
lease payments, unrealized foreign exchange gains or losses, derivative 
instruments gains or losses, cash settlements on derivative instruments 
and other financial instruments gains or losses. Management uses this 
financial measure to analyze performance and income or loss generated by 
our principal business activities prior to the consideration of how 
non-cash items affect that income or loss, and believes that this 
financial measure is also useful supplemental information for investors 
to analyze performance and our financial results. A reconciliation from 
net income or loss to funds flow from operations is as follows: 
 
 
 
 
                                                                                 Three Months 
                                                       Three Months Ended March      Ended 
                                                                 31,             December 31, 
                                                       ------------------------  ------------- 
Funds Flow From Operations - 
 (Non-GAAP) Measure ($000s)                                2021         2020         2020 
                                                       ------------  ----------  ------------- 
Net loss                                               $(37,422)     $(251,626)  $(47,871) 
Adjustments to reconcile net loss to funds flow from 
 operations 
   DD&A expenses                                         31,318         57,294     33,115 
   Goodwill impairment                                       --        102,581         -- 
   Asset impairment                                          --          3,904     57,402 
   Deferred tax expense (recovery)                        8,651         34,606    (13,352) 
   Stock-based compensation expense (recovery)            3,671         (2,055)     1,923 
   Amortization of debt issuance costs                      881            844        851 
   Non-cash lease expense                                   444            490        457 
   Lease payments                                          (462)          (515)      (522) 
   Unrealized foreign exchange loss (gain)               13,003         20,799    (17,064) 
   Derivative instruments loss (gain)                    23,698        (12,867)    12,354 
   Cash settlements on derivative instruments           (13,404)         3,487     (5,096) 
   Other financial instruments (gain) loss               (1,405)        65,285    (13,241) 
Funds flow from operations                             $ 28,973      $  22,227   $  8,956 
                                                        =======       ========    =======  === 
 
 
   Gran Tierra is unable to provide forward-looking net income and oil and 
gas sales, the GAAP measures most directly comparable to the non-GAAP 
measures EBITDA and operating netback, respectively, due to the 
impracticality of quantifying certain components required by GAAP as a 
result of the inherent volatility in the value of certain financial 
instruments held by the Company and the inability to quantify the 
effectiveness of commodity price derivatives used to manage the 
variability in cash flows associated with the forecasted sale of its oil 
production and changes in commodity prices. 
 
   Operating netback as presented is defined as projected 2021 oil and gas 
sales less projected 2021 operating and transportation expenses. 
Operating netback per bbl as presented is defined as projected oil and 
gas sales price less 2021 forecasts of transportation and quality 
discount, royalties, operating costs and pipeline transportation from 
the 2021 budget Brent oil price forecast as outlined in the table above. 
The most directly comparable GAAP measures are oil and gas sales and oil 
and gas sales price, respectively. Gran Tierra is unable to provide a 
quantitative reconciliation of either forward-looking operating netback 
or operating netback per bbl to its most directly comparable 
forward-looking GAAP measure because management cannot reliably predict 
certain of the necessary components of such forward-looking GAAP 
measures. 
 
   EBITDA as presented is defined as projected 2021 net income adjusted for 
DD&A expenses, interest expense and income tax expense or recovery. The 
most directly comparable GAAP measure is net income. Gran Tierra is 
unable to provide a quantitative reconciliation of forward-looking 
EBITDA to its most directly comparable forward-looking GAAP measure 
because management cannot reliably predict certain of the necessary 
components of such forward-looking GAAP measure. 
 
   Free cash flow as presented is defined as the midpoint of GAAP projected 
2021 "net cash provided by operating activities" less the midpoint of 
projected 2021 capital spending. The most directly comparable GAAP 
measure is net cash provided by operating activities. Management 
believes that free cash flow is a useful supplemental measure for 
management and investors to in order to evaluate the financial 
sustainability of the Company's business. Gran Tierra is unable to 
provide a quantitative reconciliation of forward-looking free cash flow 
to its most directly comparable forward-looking GAAP measure because 
management cannot reliably predict certain of the necessary components 
of such forward-looking GAAP measure. 
 
   Presentation of Oil and Gas Information 
 
   References to a formation where evidence of hydrocarbons has been 
encountered is not necessarily an indicator that hydrocarbons will be 
recoverable in commercial quantities or in any estimated volume. Gran 
Tierra's reported production is a mix of light crude oil and medium and 
heavy crude oil for which there is not a precise breakdown since the 
Company's oil sales volumes typically represent blends of more than one 
type of crude oil. Well test results should be considered as preliminary 
and not necessarily indicative of long-term performance or of ultimate 
recovery. Well log interpretations indicating oil and gas accumulations 
are not necessarily indicative of future production or ultimate 
recovery. If it is indicated that a pressure transient analysis or 
well-test interpretation has not been carried out, any data disclosed in 
that respect should be considered preliminary until such analysis has 
been completed. References to thickness of "oil pay" or of a formation 
where evidence of hydrocarbons has been encountered is not necessarily 
an indicator that hydrocarbons will be recoverable in commercial 
quantities or in any estimated volume. 
 
   This press release contains certain oil and gas metrics, including 
operating netback and cash netback, which do not have standardized 
meanings or standard methods of calculation and therefore such measures 
may not be comparable to similar measures used by other companies and 
should not be used to make comparisons. These metrics are calculated as 
described in this press release and management believes that they are 
useful supplemental measures for the reasons described in this press 
release. 
 
   Such metrics have been included herein to provide readers with 
additional measures to evaluate the Company's performance; however, such 
measures are not reliable indicators of the future performance of the 
Company and future performance may not compare to the performance in 
previous periods. 
 
 
 
 

(END) Dow Jones Newswires

May 04, 2021 21:49 ET (01:49 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.

1 Year Gran Tierra Energy Chart

1 Year Gran Tierra Energy Chart

1 Month Gran Tierra Energy Chart

1 Month Gran Tierra Energy Chart
ADVFN Advertorial
Your Recent History
LSE
GTE
Gran Tierr..
Register now to watch these stocks streaming on the ADVFN Monitor.

Monitor lets you view up to 110 of your favourite stocks at once and is completely free to use.

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V:gb D:20210516 00:50:18