Gran Tierra Energy Increases 2013 Production Guidance, Expands Moqueta Field
Appraisal Drilling Program in Colombia
Three appraisal wells added to 2013 Moqueta drilling program after Moqueta-11
tests almost 1,600 BOPD
CALGARY, Oct. 16, 2013 /CNW/ - Gran Tierra Energy Inc. ("Gran Tierra Energy")
(NYSE MKT: GTE, TSX: GTE), a company focused on oil exploration and production
in South America, today provided a production and operations update for its
2013 work program.
"Gran Tierra Energy continues its operational momentum with strong corporate
wide production in the third quarter, the successful testing of Moqueta-11 and
the addition of three appraisal wells to this year's program to further define
new reserve potential in the Moqueta field in the Putumayo Basin, Colombia,"
said Dana Coffield, President and Chief Executive Officer of Gran Tierra
Energy. "The Moqueta-11 well tested two zones separately at a combined rate of
almost 1,600 barrels of oil per day which should contribute to the growing
production profile at the Moqueta field expected in 2014. Continued strong
production and transportation performance throughout our portfolio has now led
to another increase to Gran Tierra Energy's full-year production
expectations," concluded Coffield.
Production for the third quarter of 2013 averaged approximately 22,500 barrels
of oil equivalent per day ("BOEPD") net after royalties ("NAR") before
adjustment for inventory changes or 22,000 BOEPD NAR adjusted for inventory
changes (97% oil). Production for the third quarter of 2013 consisted of
18,900 barrels of oil per day ("BOPD") NAR in Colombia, 2,800 BOEPD NAR in
Argentina (82% oil) and 800 BOPD NAR in Brazil, all before inventory changes.
Production for the third quarter of 2013 was above expectations due to the
continued strong reservoir performance from the Costayaco field and successful
execution of transportation strategies. As a result, Gran Tierra Energy
anticipates 2013 average production to range between 21,500 and 22,500 BOEPD
NAR before adjustment for inventory changes, an increase from the company's
prior projections of 21,000 to 22,000 BOEPD NAR before adjustment for
inventory changes. Approximately 96% of this production is expected to consist
of light oil, with the balance consisting of natural gas.
Chaza Block, Putumayo Basin (100% working interest and operator)
The Moqueta-11 appraisal well was drilled to the southern flank of the Moqueta
structure and encountered oil in the T-Sandstone and Caballos formations.
The T-Sandstone formation consisted of 81 feet true vertical depth ("TVD")
gross reservoir or 65 feet TVD of net reservoir thickness. It was perforated
and tested from 6,812 feet to 6,912 feet measured depth ("MD") for 46 hours at
an average rate of 802 BOPD of 27.2° API oil with a 0.3% water cut. The
underlying Caballos formation consisted of 237 feet TVD gross reservoir or 144
feet TVD net reservoir thickness. It was perforated and tested from 7,043 feet
to 7,333 feet MD for 65 hours at an average rate of 756 BOPD of 27.4° API oil
with a 0.3% water cut. The well was tested with a hydraulic jet pump. The
top of the Villeta T-Sandstone is approximately 290 feet lower in the
Moqueta-11 well compared to the lowest known oil encountered in the field at
Moqueta-7 well, suggesting the oil column is 290 feet thicker than previously
defined. The gross oil column in the Villeta T-Sandstone has now grown to 765
feet and the gross oil column in the underlying Caballos reservoir has now
grown to 960 feet.
Results to date indicate additional oil potentially exists further down the
flank of the Moqueta structure. As a result, three new appraisal wells have
been added to the 2013 Moqueta work program. The Moqueta-12 appraisal well
began drilling on September 23, 2013, and is targeting a reservoir that is
further south in a previously untested block approximately 270 feet down dip
of the lowest known oil encountered at Moqueta-11.
Gran Tierra Energy intends to drill two additional wells adjacent to the
Moqueta field before year-end. The Corunta-1 well is expected to spud in
November and be drilled in a northeast direction from the Costayaco-17 well
pad targeting what is believed to be a downthrown fault block extension west
of the Moqueta field. The Zapotero-1 well is expected to spud in December
and target the southeastern portion of the Moqueta structure.
Guayuyaco Block, Putumayo Basin (70% Working Interest and operator, Ecopetrol
30% Working Interest)
The Miraflor West-1 exploration well on the Guayuyaco Block, targeting the
same Cretaceous sandstone reservoirs encountered at the Costayaco and Moqueta
oil fields, is expected to spud in November 2013.
Llanos-22 Block, Llanos Basin (Gran Tierra Energy 45% Working Interest, CEPSA
55% Working Interest and operator)
The Mayalito-1 exploration well is drilling ahead and is expected to reach
total depth ("TD") in October. This well will explore a shallow prospect and
test additional deeper hydrocarbon bearing zones encountered but not tested by
the successful Ramiriqui-1 oil discovery well.
Gran Tierra Energy is preparing to re-enter and isolate the final two fracture
stages at the 1-GTE-6HP-BA well, on Block REC-T-129, prior to re-testing the
Gomo shale interval. The micro-seismic data acquired during the fracture
stimulation at 1-GTE-6HP-BA suggested that the final two fracture stages had
greater fracture heights than expected and inadvertently fracked into a lower
saline water bearing zone.
1-GTE-7HPC-BA is a sidetrack from the 1-GTE-7HP-BA wellbore on Block REC-T-155
and is also targeting the Gomo shale oil interval. The intent was to drill a
1,640 foot horizontal section; however, due to wellbore stability issues the
well reached TD with a 440 feet horizontal section. The wellbore is currently
suspended awaiting fracture stimulation which is planned for early December.
The 1-GTE-8-BA exploration well is a deviated well targeting the Gomo shale
oil interval on Block REC-T-155. Gran Tierra Energy met its primary objective
which was to cut and retrieve core from the target interval; 144 feet of core
was successfully retrieved for detailed special core analysis studies to gain
critical information regarding the oil shale play. The wellbore is currently
suspended awaiting fracture stimulation which is planned for mid-November.
Gran Tierra Energy received a payment of approximately $54 million (before
income taxes) in connection with termination of a farm-in agreement in the
Recôncavo Basin relating to blocks REC-T-129, -142, -155 and -224. The
payment will be recorded in Gran Tierra Energy's third quarter 2013 results as
a credit to its capital pool and an associated income tax expense. Gran
Tierra Energy retains 100% working interest in these blocks.
About Gran Tierra Energy Inc.
Gran Tierra Energy is an international oil and gas exploration and production
company, headquartered in Calgary, Canada, incorporated in the United States,
trading on the NYSE MKT (GTE) and the Toronto Stock Exchange (GTE), and
operating in South America. Gran Tierra Energy holds interests in producing
and prospective properties in Colombia, Argentina, Peru, and Brazil. Gran
Tierra Energy has a strategy that focuses on establishing a portfolio of
producing properties, plus production enhancement and exploration
opportunities to provide a base for future growth.
Gran Tierra Energy's Securities and Exchange Commission filings are available
on a web site maintained by the Securities and Exchange Commission at
http://www.sec.gov and on SEDAR at http://www.sedar.com.
Forward Looking Statements and Advisories
Readers are cautioned that the well-flow test results disclosed in this press
release are not necessarily indicative of long term performance or of ultimate
This news release contains certain forward-looking information and
forward-looking statements (collectively, "forward-lookingstatements") under
the meaning of applicable securities laws, including Canadian Securities
Administrators' National Instrument 51-102 - Continuous Disclosure Obligations
and the United States Private Securities Litigation Reform Act of 1995. The
use of the words "should", "anticipate", "will", "intends", "planned",
"expected" and "potentially" and derivations thereof and similar terms
identify forward-looking statements. In particular, but without limiting the
foregoing, this news release contains forward-looking statements regarding
Gran Tierra Energy's 2013 average production rates and the product mix of such
production, its anticipated production, exploration and development
activities, expected benefits from testing, and expected timing of activities
The forward-looking statements contained in this news release reflect several
material factors and expectations and assumptions of Gran Tierra Energy
including, without limitation: assumptions relating to log evaluations; that
Gran Tierra Energy will continue to conduct its operations in a manner
consistent with past operations; the accuracy of testing and production
results and seismic data; the effects of certain drilling techniques; cost and
price estimates; and the general continuance of current or, where applicable,
assumed operational, regulatory and industry conditions. Gran Tierra Energy
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
The forward-looking statements contained in this news release are subject to
risks, uncertainties and other factors that could cause actual results or
outcomes to differ materially from those contemplated by the forward-looking
statements, including, among others: test results provide only an indication
of resource amounts and are not conclusive as to actual resource amounts,
which may be substantially different than indicated by the test results;
unexpected technical difficulties and operational difficulties may occur,
which could impact or delay the completion or continuation of drilling;
geographic, political and weather conditions can interrupt drilling, which
could impact or delay the commencement or continuation of drilling; and the
risk that current global economic and credit market conditions may impact oil
prices and oil consumption more than Gran Tierra Energy currently predicts,
which could cause Gran Tierra Energy to change its current drilling,
production and testing plans; and production data should be considered
preliminary until a full well test interpretation has been done. Further
information on potential factors that could affect Gran Tierra Energy are
included in risks detailed from time to time in Gran Tierra Energy's
Securities and Exchange Commission filings, including, without limitation,
under the caption "Risk Factors" in Gran Tierra Energy's Quarterly Report on
Form 10-Q filed August 6, 2013. These filings are available on a Web site
maintained by the Securities and Exchange Commission at http://www.sec.gov and
on SEDAR at www.sedar.com.The forward-looking statements contained herein
are expressly qualified in their entirety by this cautionary statement. The
forward-looking statements included in this press release are made as of the
date of this press release and Gran Tierra Energy 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 securities legislation.
A barrel of oil equivalent ("BOE") is calculated using the conversion factor
of six thousand cubic feet ("Mcf") of natural gas being equivalent to one
barrel of oil. BOEs may be misleading, particularly if used in isolation. A
BOE conversion ratio of 6 Mcf : 1 barrel of oil 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 to natural gas is
significantly different from the energy equivalent of six to one, utilizing a
BOE conversion ratio of 6 Mcf: 1 barrel of oil would be misleading as an
indication of value.
SOURCE Gran Tierra Energy Inc.
For investor and media inquiries please contact: Jason Crumley Director,
Investor Relations 403-265-3221 email@example.com www.grantierra.com
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CO: Gran Tierra Energy Inc.
NI: OIL FIELD
-0- Oct/16/2013 12:00 GMT
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