Gran Tierra Energy Inc. Provides Operations Update

Bay Street

10 months ago

2024 Year-to-Date Total Company Average Production¹of Approximately 33,100 BOPD, 6% Percent Increase from Fourth Quarter 2023
Total Current²Company Average Production of Approximately of 35,200 BOPD

CALGARY, Alberta, March 11, 2024 (GLOBE NEWSWIRE) — Gran Tierra Energy Inc. (“Gran Tierra” or the “Company”) (NYSE American:GTE)(TSX:GTE)(LSE:GTE) today announced an operational 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 of oil 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 thrilled by the outcome to the start of our development drilling program so far in 2024. In particular, the performance of the Costayaco development wells serve as clear evidence of the field’s ongoing development potential, and confirming our geologic and reservoir modeling continues to be a predictive tool identifying development drilling opportunities that enhances oil recovery in a high-quality mature oil field. The current production in the Costayaco field is the highest achieved since May 2019. This positions the Company favorably as we enter 2024, as we eagerly initiate our near-field, high-impact exploration program in Ecuador, scheduled to commence in April.”

Operations Update:

Production:
- Gran Tierra’s average production year to date is approximately 33,100 BOPD as a result of successful drilling campaigns in both Acordionero and Costayaco, representing a 6% percent increase from Q4.
- Total company average production of approximately:
  - January 2024: 31,300 BOPD
  - February 2024: 34,200 BOPD
  - March² 2024: 35,200 BOPD
- Based on the 2024 budget, previously released on January 23, 2024, and these encouraging results, Gran Tierra is well positioned to achieve its 2024 production guidance of 32,000 to 35,000 BOPD.
Colombia Development:
- Costayaco Development Campaign (Putumayo Basin):
  - Since December 2023, Gran Tierra has drilled 5 wells of which 4 are oil producers and 1 is a water injector:
    - The first well, CYC-56, has been on production with jet pump since early January 2024. During the period of January 6 to March 6, 2024, CYC-56 produced on jet pump at a stable average rate of 1,821 BOPD (30-degree API gravity) with a water-cut of 1% and a gas-oil ratio of 151 standard cubic feet (“scf”) per stock tank barrel.
    - The second well, CYC-57, was spud on January 6, 2024, and reached final total depth on January 13, 2024. It was completed in the Villeta and Caballos formations and started production testing on January 22, 2024. During the period of January 22 – March 6, 2024, CYC-57 produced on jet pump at a stable average rate of 1,086 BOPD (29-degree API gravity) with a water-cut of 7% and a gas-oil ratio of 119 scf per bbl (“scf/bbl”).
    - The third well, CYC-58, was spud on January 23, 2024, and reached final total depth on January 29, 2024. It was completed in the Villeta and Caballos formations and started production testing on February 8, 2024. During the period of February 8 – March 6, 2024, CYC-58 produced on jet pump at a stable average rate of 1,892 BOPD (29-degree API gravity) with a water-cut of 6% and a gas-oil ratio of 188 scf/bbl.
    - The fourth well, CYC-59 was spud on February 8, 2024, and reached final total depth on February 19, 2024. It was completed in the Villeta and Caballos formations and started production testing on February 25, 2024. During the period of February 25 – March 6, 2024, CYC-59 produced on jet pump at a stable average rate of 694 BOPD (29-degree API gravity) with a water-cut of 42% and a gas-oil ratio of 289 scf/bbl.
    - The fifth well, CYC-60, an injector, was spud on February 26, 2024, and reached final total depth on March 3, 2024. It will be completed in the Villeta and Caballos formations in Q2-2024 as a water injector.
    - All 5 wells were drilled 13% below budget, on average for approximately $2.3 million, in approximately 11.5 days from spudding the well to final rig release. Notably, CYC-58 set a new field record for cost and time of approximately $1.9 million and in 8.7 days respectively.
    - All wells are currently produced on a jet pump and in the third quarter the Company plans on replacing the jet pumps with electronic submersible pumps to increase drawn down and production.
  - As a follow-up to the successful development program in the north of Costayaco, Gran Tierra will drill two additional development wells in the southern region based on the same concepts applied in the north which targeted un-swept/unrecovered oil. Drilling is expected to commence the second quarter of 2024.
- Acordionero Development Campaign (Middle Magdalena Valley Basin):
  - An 11-well development drilling program was started in December 2023. All 11 wells have been drilled to date including 9 producers and 2 water injection wells. All wells are on production and the final injection well completion is underway.
    - All 11 wells were drilled 17% below budget, on average for approximately $1.3 million, in approximately 6.1 days on average from spudding the well to final rig release. Notably, AC-122 was pacesetter and drilled for $1 million and in 4.2 days. The drill costs have decreased by approximately 51 percent since 2016.
    - Production results were as expected and in line with our 2024 budget.
  - With the successful implementation of the waterflood and encouraging results from the polymer project, Acordionero is expected to generate material free cash flow for years to come and will fund high growth assets such as Suroriente and the high impact, near field exploration program.
Exploration Update:
- Following the completion of the Acordionero drilling program, Gran Tierra is now in the process of moving the drilling rig to Ecuador to commence its 2024 near-field high impact exploration program. Drilling is expected to commence in April in the Chanangue Block.
- The acquisition of a 238 square kilometers 3D seismic program on the Charapa block began in January. To date, working with communities, GTE’s third-party contractor continues to progress land permitting and surveying. The program is planned to be finished in late Q2 to early in Q3. The 3D seismic will assist in the full field development of Charapa and in identifying additional prospects on the block.
Operational Safety:
- Gran Tierra continues to be the top performer in both lost time incident frequency³ (0.00) and total recordable incident frequency⁴ (0.04) safety metrics as per an internal study conducted by the Colombian Health, Safety and Environmental National Committee for 2023 on Colombian producers.
- During 2023 Gran Tierra received an “A” rating from MSCI⁵ as a result of its Beyond Compliance philosophy and ESG performance.

Corporate Presentation:

Gran Tierra’s Corporate Presentation has been updated and is available at www.grantierra.com.

¹_{Gran Tierra’s total 2024 year-to-date average production is for the period of January 1, 2024, to March 10, 2024}
²_{Gran Tierra’s March total average production is for the period of March 1, 2024, to March 10, 2024}
³_{Lost Time Incident Frequency. LTIF = ((Fatalities Cases + Lost Time Incident Cases) / Person Hours “PH”) x 200000 PH)}
⁴_{Total Recordable Incident Frequency. TRIF = ((Fatalities Cases + Lost Time Incident Cases + Restricted Work Cases + Medical Treatment Cases) / Person Hours) x 200000 PH)}
⁵_{MSCI is a leading provider of critical decision support tools and services for the global investment community}

Contact Information

For investor and media inquiries please contact:

Gary Guidry
President & Chief Executive Officer

Ryan Ellson
Executive Vice President & Chief Financial Officer

+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 Corporate Presentation referenced above) 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. The Company’s Canadian securities regulatory filings are available 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, which can be identified by such terms as “expect”, “plan”, “can,” “will,” “should,” “guidance,” “forecast,” “signal,” “measures taken to” and “believes”, derivations thereof and similar terms identify forward-looking statements. Such forward-looking statements include, but are not limited to, 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); expected future free cash flow; anticipated capital expenditures, including the location and impact of capital expenditures; operating and general and administrative costs; and production guidance for 2024. 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 current or, where applicable, assumed operational, regulatory and industry conditions in Colombia and Ecuador and areas of potential expansion, and the ability of Gran Tierra to execute its business and operational plans in the manner currently planned. Gran Tierra believes the material factors, expectations and assumptions reflected in the forward-looking statements are reasonable at this time but no assurance can be given that these factors, expectations and assumptions will prove to be correct.

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: Gran Tierra’s operations are located in South America and unexpected problems can arise due to guerilla activity, strikes, local blockades or protests; technical difficulties and operational difficulties may arise which impact the production, transport or sale of Gran Tierra’s products; other disruptions to local operations; global health events; global and regional changes in the demand, supply, prices, differentials or other market conditions affecting oil and gas, including inflation and changes resulting from a global health crisis, geopolitical events, including the ongoing conflicts in Ukraine and the Gaza region, or from the imposition or lifting of crude oil production quotas or other actions that might be imposed by OPEC, and other producing countries and resulting company or third-party actions in response to such changes; changes in commodity prices, including volatility or a prolonged decline in these prices relative to historical or future expected levels; the risk that current global economic and credit 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; prices and markets for oil and natural gas are unpredictable and volatile; the effect of hedges; the accuracy of productive capacity of any particular field; geographic, political and weather conditions can impact the production, transport or sale of Gran Tierra’s products; the ability of Gran Tierra to execute its business plan and realize expected benefits from current initiatives; 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 Gran Tierra’s operating activities; the failure of exploratory drilling to result in commercial wells; unexpected delays due to the limited availability of drilling equipment and personnel; volatility or declines in the trading price of Gran Tierra’s 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 indentures; 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, 2023 filed February 20, 2024 and its other filings with the SEC. These filings are available on the SEC website at http://www.sec.gov and on SEDAR+ at www.sedarplus.com. Guidance is uncertain, particularly when given over extended periods of time, and results may be materially different. Although the current capital spending program and long term strategy of Gran Tierra is based upon the current expectations of the management of Gran Tierra, should any one of a number of issues arise, Gran Tierra may find it necessary to alter its business strategy and/or capital spending program and there can be no assurance as at the date of this press release as to how those funds may be reallocated or strategy changed and how that would impact Gran Tierra’s results of operations and financing position. In particular, the unprecedented nature of the current economic downturn, 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. Gran Tierra’s forward-looking statements are expressly qualified in their entirety by this cautionary statement.

The estimates of future production 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 2024. 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. 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 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.

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 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.

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