Frontera details US$385-455mn capital spending plan

South America-focused oil and gas company Frontera will invest US$385-455mn in 2022 as it turns its focus to lower-risk exploration activity in Colombia and Ecuador.

The forecast represents a reduction of around 10% from the mid-point of the company's 2022 guidance, which ranged from US$435mn to US$495mn.

Production is seen averaging 40-43,000boe/d compared to a 2022 guidance of 41,000-43,000boe/d. 

"The 2023 program ... supports our ongoing efforts to diversify our production mix and lays the foundation for the company's path to grow production to 50,000 boe/d," CEO Orlando Cabrales said in a statement. 

The targets were set using a predicted Brent price of US$80/b and a median exchange rate of 4,600 pesos per US dollar.  

"In 2023, we will advance [our] exciting development and lower-risk exploration portfolio in Colombia and Ecuador, invest in infrastructure and facilities at Quifa and CPE-6 to increase production, leverage our advantaged transportation and logistics structure to maximize realized prices, mature our self-sustaining and growing midstream business including Puerto Bahia and ODL," Cabrales said.

He added that the company also planned to execute its hedging program while drilling its second exploration well – Wei-1 – off the coast of Guyana. 

On the development front, the firm will allocate US$215-$255mn to upstream activities in Colombia and Ecuador, including US$110-130mn to drill 55 gross production wells, mainly in Quifa SW, CPE-6, Cajua and Copa fields.

It also aims to complete 24 gross well interventions and drill two injector wells while spending US$75-85mn on new infrastructure, primarily to increase oil and water handling capacity at CPE-6 and Quifa.