Gran Tierra Energy, Inc. Gran Tierra Energy Inc. Provides Operations And Financial Update

 
TIDMGTE 
 
   Achieved First Quarter 2021 Average Production of 24,463 BOPD, Up 12% 
from Prior Quarter 
 
   Increased Current Average Production(1) to 28,930 BOPD, Highest Since 
February 2020 
 
   Increased Acordionero Field Current Average Production(1) to 16,400 BOPD, 
Highest Since September 2019 
 
   Reaffirms 2021 Full-Year Production Guidance of 28,000-30,000 BOPD 
 
   CALGARY, Alberta, April 12, 2021 (GLOBE NEWSWIRE) -- Gran Tierra Energy 
Inc. ("Gran Tierra" or the "Company") (NYSE American:GTE)(TSX:GTE) 
(LSE:GTE) today announced an operations and financial update. All dollar 
amounts are in United States dollars and all production volumes are on a 
working interest before royalties ("WI") basis and are expressed in 
barrels ("bbl") of oil per day ("bopd"), unless otherwise stated. 
 
   Key Highlights: 
 
 
   -- Production: Gran Tierra's average production for various time periods is 
      outlined in the table below: 
 
 
 
 
                                                                      Total 
   Average      Acordionero   Costayaco     Moqueta       Other      Company 
  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(1)       16,400        4,700        2,400        5,430      28,930 
--------------  -----------  -----------  -----------  -----------  ---------- 
 
 
   (1) Approximate average production over the period from March 28, 2021 
to April 10, 2021 
 
 
   -- 2021 Production Guidance: Based on the Company's significant progress in 
      increasing production during and subsequent to the first quarter of 2021, 
      Gran Tierra reaffirms its 2021 full-year production guidance of 
      28,000-30,000 bopd 
 
   -- Credit Facility and Cash Balances: As of March 31, 2021, the Company had 
      paid down its credit facility balance by $10 million to $180 million and 
      had increased its cash and cash equivalents balance to $20 million, 
      compared to a credit facility balance of $190 million and cash and cash 
      equivalents balance of $14 million as of December 31, 2020 
 
   -- 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 
 
          -- The combination of the workover and drilling programs has resulted 
             in Acordionero's current average production2 of 16,400 bopd, with 
             approximately 700 bopd of additional production to be added from 
             existing wells; Gran Tierra also plans to drill and complete an 
             additional 3 to 5 wells and bring them on production during the 
             second quarter of 2021 
 
          -- Acordionero's current average production2 is the highest level 
             achieved since September 2019; 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 more than 18 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 infill oil well was drilled during the first quarter 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 CYC-42 well was drilled in 12.1 days at a 
             cost of $1.9 million, a 30% decrease from the last 4 wells drilled 
             in Costayaco 
 
          -- Currently, the CYC-43 infill well is being drilled and is expected 
             be cased and cemented on or around April 12, 2021 
 
          -- The CYC-44 infill well is expected to spud on or around May 15, 
             2021 
 
          -- All 3 wells are expected to be on production by the end of the 
             second quarter of 2021 
 
          -- Workovers on 6 producing wells were completed during the first 
             quarter of 2021, with oil production restored and ramping back up 
 
   -- Moqueta Oil Field (100% WI) 
 
          -- During the second quarter of 2021, Gran Tierra plans a 5-well 
             workover program, which is expected to consist of 1 workover 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 expected to move to the Suroriente Block in 
             mid-April 2021, where it is expected to accelerate the running of 
             larger pumps in 2 oil wells and to restore production in 3 
             additional oil wells which are currently offline 
 
 
   Message to Shareholders 
 
   Gary Guidry, President and Chief Executive Officer of Gran Tierra, 
commented: "At the beginning of the fourth quarter of 2020, we decided 
to hedge 15,000 bopd of first half 2021 production and to resume 
development operations across all of our major assets. Throughout the 
first quarter of 2021, we have significantly and profitably restored 
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 bopd. 
 
   Our 2021 capital budget of $130-150 million remains a balanced, 
returns-focused program which prioritizes free cash flow generation and 
debt reduction. If Brent oil prices continue to be well above our 
original 2021 budget forecast of $49 per bbl, we plan to further 
accelerate debt reduction through the remainder of 2021. We also 
continue to advance exploration-related activities for our prioritized, 
high impact exploration program and we expect to increase activity in 
2022. 
 
   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. In addition, our 'Beyond 
Compliance Philosophy and Policy' continues. Where Gran Tierra 
identifies significant opportunities and benefits to the environment and 
communities, we voluntarily strive to go beyond what is legally required 
to protect the environment and provide social benefits, because it is 
the right thing to do." 
 
   (2) Approximate average production over the period from March 28, 2021 
to April 10, 2021 
 
   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 
 
   [phone] 
 
   [e-mail] 
 
   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 new 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 does not constitute a part of this 
press release. Investor inquiries may be directed to [e-mail] 
or [phone]. 
 
   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, 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 
"expect", "plan", "can," "will," "should," "guidance," "forecast," 
"signal," "measures taken to" and "believes", derivations thereof and 
similar terms identify forward-looking statements. In particular, but 
without limiting the foregoing, this press release contains 
forward-looking statements regarding: the Company's strategies related 
to drilling and operation activities, expectations regarding reservoir 
prospects and production amounts, future well results (including initial 
oil production rates and productive capacity based on past performance) 
and operating and general and administrative costs, production guidance 
for 2021, the impact of the Company's COVID-19 protocols, the Company's 
expectations as to debt repayment and its positioning for 2021. The 
forward-looking statements contained in this press release reflect 
several material factors and expectations and assumptions of Gran Tierra 
including, without limitation, that Gran Tierra will continue to conduct 
its operations in a manner consistent with its current expectations, 
pricing and cost estimates (including with respect to commodity pricing 
and exchange rates), and the general continuance of assumed operational, 
regulatory and industry conditions in Colombia and Ecuador, and the 
ability of Gran Tierra to execute its business and operational plans in 
the manner currently planned. 
 
   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: he 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 
and its other filings with the Securities and Exchange Commission. These 
filings are available on the Securities and Exchange Commission 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. 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 set forth in this press release 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. These projections may not be 
appropriate for other purposes. These projections contain 
forward-looking statements and are based on a number of material 
assumptions and factors set out above. Actual results may differ 
significantly from the projections presented herein. These projections 
may also be considered to contain future-oriented financial information 
or a financial outlook. The actual results of Gran Tierra's operations 
for any period will likely 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 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 operational and 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. 
 
   Presentation of Oil and Gas Information 
 
   BOEs have been converted on the basis of 6 thousand cubic feet ("Mcf") 
of natural gas to 1 bbl of oil. BOEs may be misleading, particularly if 
used in isolation. A BOE conversion ratio of 6 Mcf: 1 bbl is based on an 
energy equivalency conversion method primarily applicable at the burner 
tip and does not represent a value equivalency at the wellhead. In 
addition, given that the value ratio based on the current price of oil 
as compared with natural gas is significantly different from the energy 
equivalent of six to one, utilizing a BOE conversion ratio of 6 Mcf: 1 
bbl would be misleading as an indication of value. 
 
   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 no 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. 
 
 
 
 
 
 

(END) Dow Jones Newswires

April 12, 2021 06:00 ET (10:00 GMT)

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