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: “Gran Tierra is thrilled to announce the test results from the Arawana-J1 well (100% WI, Operator), marking a significant milestone for our operations in Ecuador. These results not only highlight the potential of the Arawana field area but continues to demonstrate the success of our exploration program in our core southern Colombia (Rose discovery) and northern Ecuador (Bocachico and Charapa Norte discoveries). We are very excited that the closest analogue to the Arawana field area, in terms of closure, thickness, rock and fluid properties, is our Cohembi field located in Colombia's South Putumayo Basin, which we operate and is located just 20 km to the north. As disclosed with our latest annual Company reserves disclosure as of December 31, 2023, the ultimate gross Proved plus Probable (“2P”) original recoverable reserves from Cohembi as estimated by McDaniel & Associates Consultants Ltd., the Company’s independent qualified reserves evaluator is 82 million bbls. A major advantage of operating in both Ecuador and Colombia is the ability to quickly monetize production from new discoveries. With nearby infrastructure and regulatory approvals already in place, we are well-positioned to quickly appraise and develop the Arawana field. We will utilize Gran Tierra's strong cash flow, solid balance sheet, and new production from this discovery to fund the development.
In addition, to our progress testing Arawana-J1, we are pleased to provide an update on our drilling operations. The rig that drilled Arawana-J1 was moved to the Bocachico Norte-J1 well cellar, where the Bocachico Norte-J1 well (100% WI, Operator) was spud on May 24th, marking the start of the second exploration well in our 2024 exploration plan. As of May 27th, the well is drilling ahead at approximately 6,670 feet to an expected total depth of approximately 10,800 feet. Following the drilling and completion of the Bocachico Norte-J1 well, the rig will move to the Charapa Block (100% WI, Operator) to commence drilling three exploration wells. Once this phase is complete, the rig will return to the Chanangue block to drill two additional exploration wells from the K pad, Zabaleta-K1 and Zabaleta Oeste-K1 (100% WI, Operator). We are particularly excited about the Zabaleta wells, as they are positioned up dip from Arawana-J1 and on the structural high, promising further potential for significant discoveries in the vertically stacked intervals of the Basal Tena, U-Sand, T-Sand and Hollin high permeability sandstones. Gran Tierra is currently working closely with the Ministry of Energy and Mines of Ecuador to fast track the exploration and development of all of Gran Tierra’s Ecuadorian blocks.
The Arawana-J1 discovery, which was the highest-risk well in our 2024 exploration program, has set the stage for Gran Tierra to deliver strong reserve results and has opened another development horizon in Ecuador that we expect to fully fund from internally generated cash flow. This success also validates our refined geological model, which has proven effective with the last four exploration wells yielding four oil discoveries. We are confident that our future development and exploration programs will continue to drive our growth and success in the region.”
Arawana-J1 Oil Discovery:
- Gran Tierra has run production casing, cemented and perforated the Basal Tena oil zone and has begun production testing.
- The Basal Tena was perforated over 23.5 ft of reservoir. A jet pump was run and the well has produced at stabilized rates over 48 hours at 1,174 barrels oil per day (“bopd”), 20-degree API gravity oil, less than 1% water cut, and a gas-oil ratio (“GOR”) of 258 standard cubic feet per stock tank barrel (“scf/stb”).
- The well continues to clean-up and over the past 12 hours the well has produced at stabilized rates of 1,358 BOPD of 20-degree API gravity oil, less than 1% water cut, and a GOR of 239 scf/stb.
The analogue for the Arawana field area is the Cohembi field 20 km north, where Gran Tierra is in the process of expanding the waterflood to optimize recovery from the field. Cohembi produces from the N-sands, the geologic equivalent of the Basal Tena at the Arawana field area. The closure, thickness, rock and fluid properties are very similar to that of the Arawana field area. One notable difference of the Arawana field area is a higher gas-oil ratio providing a lower oil viscosity which is excellent for enhanced oil recovery by waterflooding while providing natural gas for power generation.
TBD – To be determined
Exploration Update:
- Bocachico Norte-J1 (100% WI, Operator):
- Upon completion of drilling the Arawana-J1 well, the drilling rig was moved on the same well pad and commenced drilling the Bocachico Norte-J1 exploration well. The Bocachico Norte-J1 exploration well is a follow-up to the successful Bocachico-J1 (100% WI, Operator) exploration well to test both the deeper T-Sandstone and Basal Tena prospectivity.
- The Bocachico-J1 well had initial 90-day production rates in the Basal Tena (N-Sand geologic equivalent to Cohembi) of greater than 1,100 BOPD, continues to produce at approximately 850 BOPD, 20-degree API oil, and has less than 1% water cut.
- Charapa Seismic Program:
- The 20km Charapa-block 2D seismic commitment was successfully completed and the data is now being processed. The 238km2 3D program is 13% complete and will be finished shooting in mid-June. The processed 3D dataset is expected to be delivered by the third quarter of 2024 and will be used to high-grade multiple compelling structural leads identified on vintage 2D seismic lines, which are expected to be drilled in 2025.
- Remainder of the 2024 Ecuador Exploration Program:
- Upon completion of the Bocachico Norte-J1 exploration well, the rig will be moved to the Charapa Block to drill three exploration wells and finally back to the Chanangue Block to target two Zabaleta exploration wells to test the Basal Tena up dip from Arawana-J1, and test additional deeper U- and T-Sandstone units on the structural high.
Corporate Presentation:
Gran Tierra’s Corporate Presentation has been updated and is available at www.grantierra.com.
