Ecuador and Colombia
Press Release

Gran Tierra Energy Inc. Provides Operational and Financial Updates

Bnamericas Published: Tuesday, October 11, 2022

By Gran Tierra Energy

CALGARY, Alberta, Oct. 11, 2022 (GLOBE NEWSWIRE) -- Gran Tierra Energy Inc. ("Gran Tierra" or the "Company") (NYSE American:GTE)(TSX:GTE)(LSE:GTE) today announced an operational and financial update. 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") and bbl per day ("BOPD") amounts are based on WI sales before royalties.

Message to Shareholders

Gary Guidry, President and Chief Executive Officer of Gran Tierra, commented: "We are pleased to announce that we started returning value to shareholders via share buybacks during the third quarter of 2022 ("the Quarter"). In addition to the share buybacks, we are equally as excited to have started buying back some of our bonds in the open market to strengthen our balance sheet.

During the Quarter, we commenced our enhanced oil recovery ("EOR") polymer injection project in the Acordionero field. This pilot injection test is a milestone after several years of laboratory and modeling indicated the suitability of Acordionero for EOR. We continue to see strong performance from our all of our waterfloods and development drilling programs.

On the exploration front, we progressed on several prospects during the Quarter. Our Gaitas-1 well in the Middle Magdalena Valley is currently on production and a second, deeper exploration well in the field is being planned for the fourth quarter of 2022. In Ecuador, the Bocachico-1 exploration well was cased and has commenced a 3-reservoir testing program. In the Putumayo Basin of Colombia, our Rose-1 well showed encouraging results while drilling and is currently being cased for testing."

Operations Update: 

  • Production 
    • Gran Tierra's total average production was approximately 30,391 BOPD during the Quarter, which was 5% higher compared to the third quarter of 2021 and approximately flat with the second quarter of 2022.
    • The Company's fourth quarter-to-date 2022 total average production(1) has been approximately 32,000 BOPD.
  • Suroriente 
    • During the Quarter, Suroriente experienced occasional disruptions due to temporary localized blockades. The impact of these blockades lowered the Company's total average production for the Quarter by approximately 920 BOPD.
  • Ecuador Exploration:  
    • Oriente Basin: In the Chanangue Block, Gran Tierra has finished drilling the Bocachico-1 exploration well and run production casing to a total depth of 10,815 feet ("ft") measured depth. The Company plans to test three potential oil zones in the Basal Tena, U Sand, and T Sand, over the next several weeks, as identified by petrophysical log analysis. The T Sand was perforated over 23.5 ft of reservoir and placed on jet pump. The well is still cleaning up and over the last 24 hour flow period (October 9-10, 2022), it has produced at stabilized rates of 345 BOPD of 34 degree API gravity oil, 141 bbl of water per day ("BWPD") and 133 thousand standard cubic feet of gas per day ("MCFD"). The Company plans to complete a pressure build up test to assess if there is any reservoir damage in the T Sand and to then test the U Sand and Basal Tena immediately after the pressure build up. After testing the U Sand and Basal Tena, the Company plans on returning to the T Sand for further production testing.
    • Oriente Basin: In the Charapa Block, the Company spud its second 2022 exploration well in Ecuador, the Charapa Norte-1 exploration well, on October 5, 2022. This well is expected to reach its planned total depth in approximately 28 days.
  • Colombia Exploration: 
    • Middle Magdalena Valley Basin: 
      • Gran Tierra drilled and completed the Gaitas-1 exploration well in July-August 2022, and the well has been on production test from the Lisama Formation, which is the same producing formation at the Acordionero oil field. Gaitas-1 is located approximately 7 kilometers south of Acordionero's Southwest Pad. During the last week, Gaitas-1 has produced at stabilized average rates of 171 BOPD (17 degree API gravity oil), 652 BWPD and 2 MCFD.
      • Based on the encouraging results of Gaitas-1, Gran Tierra plans to spud the Gaitas-2 exploration well with a projected spud date later in the fourth quarter 2022. The Company expects Gaitas-2 to target multiple reservoir zones in a structurally higher location than the Gaitas-1 well, in a planned effort to test the deeper Umir Sands further away from possible oil-water contacts.
    • Putumayo Basin: In the ALEA-1848A Block, Gran Tierra has finished drilling the Rose-1 exploration well and is currently running production casing in order to test the well.

 Financial Update:

  • Share Buybacks: 
    • NCIB: On August 29, 2022, Gran Tierra announced via press release that the Toronto Stock Exchange ("TSX") had approved its notice of intention to make a normal course issuer bid (the "NCIB") for its shares of common stock (the "shares"). Pursuant to the NCIB, the Company will be able to purchase up to 36,033,969 shares for cancellation, representing 10% of Gran Tierra's public float, for a one-year period commencing on September 1, 2022, and ending on August 31, 2023. The aggregate purchase price under the NCIB shall not exceed $37.5 million without further consideration of and approval by Gran Tierra's board of directors.
    • Share Buybacks: Pursuant to the NCIB, as of September 30, 2022, Gran Tierra had purchased approximately 10.8 million shares, representing about 2.9% of shares outstanding, for a total purchase price of $14.4 million at an average price of approximately $1.34 per share.
  • Bond Buybacks: 
    • As part of Gran Tierra's ongoing commitment to reduce its net debt(2), during September 2022, the Company bought back approximately $20.1 million in face value of Gran Tierra's 6.25% senior notes due February 2025 (the "2025 bonds"), representing approximately 6.7% of the outstanding 2025 bonds.
    • The cost of the 2025 bonds' buyback was approximately $17.3 million, representing a discount of about 14% to the face value of the 2025 bonds.
    • Gran Tierra intends to hold the 2025 bonds which it has bought back on the Company's balance sheet.
    • Purchasing the bonds reflects a savings of $3.0 million in interest expense that would have been paid over the remaining term to the maturity of the 2025 bonds.
  • Cash and Net Debt(2): 
    • As of September 30, 2022, Gran Tierra had approximately $118 million in cash on its balance sheet and net debt(2) of approximately $462 million (net of the buyback of 2025 bonds described above).
    • Gran Tierra's new credit facility with Trafigura of up to $150 million remains undrawn. 

(1) Gran Tierra's fourth quarter-to-date 2022 total Company average production is for the 9-day period of October 1-9, 2022.
(2) Net debt is a non-GAAP measure and does 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, where applicable, reconciliations to the most directly comparable measures calculated and presented in accordance with GAAP.

Corporate Presentation:

Gran Tierra's Corporate Presentation has been updated and is available on the Company website at

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