Gran Tierra 2014 capex plan heavy on Colombia

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Wednesday, December 11, 2013

Canadian oil and gas firm Gran Tierra Energy (TSX, NYSE: GTE) expects to spend US$243mn of its US$467mn 2014 capex plan on Colombian exploration and development, the company said in a press release.

Gran Tierra will also fund exploration and development in Argentina, Brazil and Peru, with approximately 59% of next year's capex slated for field development and appraisal drilling, and 41% for exploration drilling.

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In Colombia the firm plans to spend US$118mn drilling four exploration wells and eight appraisal and development wells. "Oil exploration drilling program will target oil prospects in the Putumayo and Llanos basins, while development drilling will focus on the Moqueta and Costayaco oil fields," Gran Tierra said.

Another US$54mn is slated for facilities work primarily consisting of water injection and infrastructure work at Moqueta and Costayaco, central processing facility expansion at Jilguero, and compression and storage systems at the Ramiriqui oil field. Gran Tierra also plans to spend approximately US$71mn in Colombia on seismic shoots and geological work.

In Peru the firm plans to spend US$83mn drilling one appraisal well and one development well on block 95 in the Marañon basin, US$43mn on geological and geophysical work on block 107 in the Ucayali basin and US$22mn on facilities and other costs.

Next year's Argentina capex includes US$18mn to drill a development well in the Proa field on the Surubi block in the Noroeste basin and another in the Puesto Morales field on the Puesto Morales block in the Neuquén basin. Another US$20mn is earmarked for facilities costs and US$6mn for six workovers concentrated in the Puesto Morales field, Gran Tierra said.

In Brazil the firm plans to spend US$30mn on seismic, geological and facilities work for interests held on seven blocks in the Recôncavo basin.

Gran Tierra forecast 2014 oil and gas production at 23,500-24,500boe/d net after royalties, with Colombia's Costayaco and Moqueta fields contributing 12,000boe/d and 4,700boe/d each, respectively, the firm said.

With no debt and roughly US$353mn in cash and equivalents at 3Q13, Gran Tierra plans to primarily fund its 2014 capex plan with cash on hand.