GTE - Earnings call transcript Q4 2024 | Gran Tierra Energy Inc.

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Operator

Good morning, ladies and gentlemen, and welcome to Gran Tierra Energy's Conference Call for the Fourth Quarter and Year ended 2024 Results. My name is Shannon, and I will be your coordinator for today. [Operator Instructions]. I would like to remind everyone that this conference call is being webcast and recorded today, Monday, February 24, 2025, at 11:00 a.m. Eastern Time.

certain measures. oil include and gas may financial non-GAAP discussion forward-looking and information, information Today's to earnings disclaimers refer non-GAAP yesterday this Please the and measures for we press information call. important issued discussed release on advisories of and reconciliations with today's to and regard any operational update

property call consent expressly Energy, forbidden the Gran written Inc. this Any Finally, this of of is earnings copying Gran call Energy. Tierra of is the Tierra or rebroadcasting without

Gary Guidry, the of turn conference to Executive Guidry, call now and will Officer President over Gran please I Chief go Mr. Tierra. ahead.

Gary Guidry

and Thank Operating Ryan you, Gary operator. to Ellson, Officer. President and our Executive Chief Officer, Officer; Fourth Good conference Chief name and morning, Quarter results year-end Executive Sebastian is Vice call. and President My Morin, Financial our welcome XXXX Chief with are Tierra's today and Tierra's Gran Guidry, Gran me

and fourth issued results. This about information morning, release our detailed we that year-end XXXX included a quarter press

report on Gran on Ryan will addition, In brief has make line our we open for a and comments, and the available EDGAR been questions. website. Sebastian will few Tierra on XX-K Form then is and XXXX Energy's annual filed

the some to to over our financial of results. I'll Ryan turn now call discuss

Ryan Ellson

We XXXX in everyone. highest ever for record QX, foundation all highs quarterly setting across categories morning, Good closed growth. future production and with reserve delivered our a solid

guidance that particular, XXXX. successfully full in of pleased to its the holds investing Gran confirm focus XXXX in BOE XXX which and execution, for capture, production oil-weighted met million We're dedicated XP resource was XXXX While Tierra also average of unlocking over our portfolio, to target we on reserves. potential extensive beyond,

our our dedication Tierra X.X% commitment confidence value our our long-term prospects by Compared way our shareholder to efficient Gran issuer creation. showing future bid of repurchases company's reinforcing per in creation. capital to shareholders to a to return to value XXXX, the shares net its current share, $XX.XX course XP normal through strategic while our value repurchasing program, of asset demonstrated remain outstanding and In long-term

average working in XXXX from representing average In of and our to production results exploration blockades X a production, operations, XX,XXX Gran Tierra per terms to which months was the Acordionero in from of field -- day, positive X% Ecuador during increase acquired XXXX. BOE production by by achieved Due and related recently in production Suroriente lower of deferred offset Canadian caused from interest production partially quarter. downtime workovers the

successful our as Ecuador in expect expected in wells of Canada. projected drilling X to well X wells our increase and XX,XXX company's Suroriente, result the assets, gross BOE to on to drilling to gross appraisal from we per X in as X XX,XXX XXXX program production XXXX wells day. X of development XXXX development is integrating Building development acquired This Canadian in recently production XXXX

exploration contracts. we'll commitments for roughly Turning to the Ecuador, the of being our to of which in program when the but that end not did Recall, the committed is of year, rather of entered the commitment drilling At end exploration pay development the year. fulfilled we wells. Ecuador, to XX we to and the phase land, XXXX. move wells before X wells exploration. We plan fully capital we X to meet allocated our to to total XX% exploration exploration, allocate Ecuador those expect to With X of equates to

higher is of in decrease increased million During decrease the year, number $XXX adjusted during realized XXXX. $X.X provided drilled or slightly million to XXXX XXXX. a or cash XXXX to Brent $XXX share million, or $X.X wells of $X.XX XXXX, to of of fully compared net per EBITDA by to by XXXX $XXX XXXX. were $XXX net million. of Gran Tierra's compared by $X company capital activities a per Tierra million million million share expenditures with million realized were which the share The million loss operations in $X.XX income in funds due X% prices. Gran compared per net funded from from the of to $XXX company's X% Both of in operating commensurate decreases the $XXX a these

The company a million an in had $XXX as of XXXX. the of cash compared and XX, $XX equivalents cash December increase at to balance end million XXXX, at cash

XXXX by available to Tierra in net pay targeting end Gran the amortization credit recently $XXX remaining of on and bonds We the XXXX the the XXXX, EBITDA facilities. -- and through by of is of gross less debt target outstanding million forward, million hand Looking Xx. debt than cash debt paid XXXX to end resulting $XXX plan net and

The increase in managed the to result a of Gran Gran subsidies compared of Despite were gas million, were sales X% million XXXX, electricity Tierra decrease showing cost pressures, $XXX inflationary $XXX in higher Total workovers, the for costs oil operating a and million $XX.XX, Tierra's net natural removal costs to diesel BOE compared XXXX. increase, and expenses XXXX. primarily of higher activities. in X% were was higher XXXX per to and while XXXX. expenses when an X% in year compared slight operating effectively XXXX maintenance resilience operating representing higher XXXX, $XXX as in control Colombia in

of Sebastien to discuss I'll of current Morin our some over the highlights call now the operations. turn to

Sebastien Morin

on briefly reserves. off release from a Thanks, Ryan. discuss note. off morning, few highlights to a as highlights cover a successful the Good we as are year-end in from strong press XXXX well operational building everyone. year our Operationally, start the I XXXX will XXXX

As and has production mind. The capture and program while paying on focused capital beyond and growth resource been its Ryan off focused was XXXX that with allocation be debt. in on will formulated mentioned, XXXX

XXXX. drilling of In to quarter the Colombia of by with We are February the Ecuador, Production the are program XX. pad X-well our Suroriente North we excited drilling Cohembi spudding exploration X- the to with block, first the well is Iguana have commenced has being first at well Energy, first in currently the of of commenced on venture SUR-BX the be on end expected first In expected our Canada, drilled well, and horizontal of to the wells at end on the on wells plan February which new with are Both Simonette. partner, the XXXX. by the half first stream with exploration stimulated Logan spud X. development being currently joint X

which In wells Clearwater in XXXX, confirmed East new acreage Dawson quality drilled QX play. our and at of X the the we has in of the Clearwater Walrus,

stream wells the of are now cleaning All and on up.

expected in the of the currently which and injector, XXXX. X-lead a first be in we're a pilot drilling participating spud addition, to at online of half Hills February multilateral XX with is Marten In waterflood on

McDaniel. Canada. replacement and in and for results exploration we X,XXX% managing the achieved and equivalent Moving to barrel were underpinned also saw Colombian report our our release equivalent our results January XP, reserves XP assets pleased continued On our XXXX year-end our X,XXX% XP, multiple on barrel reserves. discoveries of XX, year-end reserve oil evaluated success we for by oil year-end as by in These that XP represented are XXX This into of reserves in for XXX XXX% million Ecuador, reserve company's sixth XP. XP, highest barrel the XXX we country million year of growth. XP XXXX entry excellent oil history. million XXXX, and new low-decline to of equivalent achieved consecutive

XP attributed highly reserves development to to inorganic addition in now compared Canada, XX% with plays Tierra's and runway infrastructure. growth portfolio reserves XX% its organic Tierra XP XX% creates cycles reserves a natural XP Furthermore, future economic opportunities reserves. of proven long-term production, with of Gran well now Canada XP and of positioned with The for of XX% approximately Gran access the is of represents total to XX% and gas. commodity

year-end $XX.XX and before XXXX and XP before of of share NAV Xp. a tax per tax and $XX.XX tax achieved also after-tax $XX.X after $XX.XX We

a Tierra's NAV of the Looking trades, returns. are share to per and at focused pillar when buybacks share Gran key share is adding where the discount as all [indiscernible] significant it to price portfolio. a of we shareholder current comes company's why across barrels categories, on this

Gran that our deliver a all out and stakeholders. I XP on To emerging to XXX well to XXX diverse capitalize locations, robust and is to and close, portfolio with XP identified Tierra undeveloped assets, of like would value with opportunities point poised

to operational the our continue operate, remain recognizing essential their goals, in deeply of committed and financial advance we well-being to we and role where success. we As our profitably communities our employees the

are to forward XXXX sets success Tierra We come. for up looking and Gran to for how it years

will call will operator, now be happy and Ryan I to ahead. please questions. I and take go to Operator, the turn Gary, back the

Operator

first with Anne of line America. comes of [Operator Our Instructions] from Bank the question Milne

Anne Milne

I very have different questions. three

will I us going go Maybe first an in the with your higher cost forward, Ecuador XXXX guess, has you sales down think and if also as that one That's could incorporating, do previous first you to in the of question. well. and idea give levels The to back XXXX. Canadian cost the of

Second is bit you a have you Obviously, just time? you if 'XX reserve these see are where forward, a you were to development program. really strong, including do assets point forward think in look 'XX, at for and production your more. and that looking little question might But levels do

think goes? think of third all the maybe say about question that, I've of but more impact just me. is your I of potentially sale Ecuador Same obviously, regions, this domestic remind X you is, in Canada, and maybe it before, but it on could then of having of domestic the could I asked from question which And you production is but The tariff? from Colombia, where higher you mind my back not most

Ryan Ellson

higher got do of of the a of increase those to XXXX. subsidies with Colombia, in respect in generate but thanks with down Anne, of also things a the number to just to trend costs Yes, we're of gas the buyer and We we XXXX. power. in the was natural questions. it in removal for gas natural Part XXXX, diesel hit the expect

just country. were general, there costs in and And the higher across electricity so just --

So impacted. we XX% our that of also fixed. are -- And about costs have

cost in to actually operating far down -- especially the ton we and to costs. don't But gas move to to well, lead satellite would as right as as permanent the units we Ecuador now. as come and Ecuador. lower up fields generate of we power drilled a wells we're in facilities as We expect come to production, these unit Ecuador those in more probably pack Ecuador, in really are starting down all So ramp have

into as well. So expect XXXX to that in do XXXX we decrease and

in production growth. that have right having you XX,XXX Looking but base. reserves. XXX we out try for this on have balance course, barrels. out, BOE of to X% year asset allocation, also to to comfortable get that the lot we depends But this with between to A guidance portfolio quite that we reinvestment the of of XX% portfolio We're as capital we grow longevity, XX,XXX XXXX, million and XP pointed can

think great in I and So natural in natural profile being potential a obviously in the and to gas of depend XX% And that's the XXXX expect with resource company. growth the that proxy on we which a again, will lot increase beyond. prices, gas, production company for

with tariff talk, talk obviously, of we sell And sell happened, well In we well we're Canada, think I production look as And what's Canada, there's respect our insulated. tariff production. Colombia to the if our you in domestically. as most in quite where at

in or talks. you in Canada about what is you light is happened it which oil of they lot tariff -- the spreads oil oil to heavy domestically. to consumed If if with happened light A $X oil look look our widened And by what diluent. of Canada, all is

look you now. South by are America, $X gone Vasconia differentials what's $X $X. to in If from tightened right happening has

amount in we and Canada. produce XXx -- so than more South production America And in

us, we'd of the So help actually that come they benefiter the to and a does tariffs do diversification net extent in. be

Anne Milne

Okay.

tariff higher, say, offset differentials would would of the -- the than potential because more increase? price So lower be let's the

Ryan Ellson

we think it Exactly. And come if be bit, that, which we we tariffs would Canada, in but at little were $X.XX widen expect it impacted on negatively already costs in in, Canadian now, you've and -- the seen also will get and here offset dollar, to dollars right also increase, our be should a paid of WTI Exactly. dollar Canadian in some Canadian will dollars. the which in quite

Anne Milne

the Canada, in sell you do where And gas? natural Okay.

Ryan Ellson

sell Natural we and it to we sell gas, domestically, BP.

Anne Milne

Okay.

impact expect So implemented. if from take -- it you together, all to tariffs you to were minimal if your be they were

Ryan Ellson

for honest, Gran be to the the positive we a positive country for To net good Not Correct. but company. think Tierra.

Operator

Our of with next the line Stifel. comes from question Lock Harrison

Harrison Lock

a couple from Just me.

Has if gone of for with the there with in been asset it's around any And integration have forward changes time I'm different Firstly, the you see interested with appreciate we asset capital And that, but you how a has the expect here can this? realizing corporate I stuff, guys? please? can structure. there? base, looking Secondly, for over this iX do ahead color scope any the package? any year, surprises synergies some we

Ryan Ellson

take Gary will current our the look at I'll look million question. have if the question, take you you in XXXX, when first we capital second Yes, $XXX structure, maturing.

to hand value maybe facilities some available equity required. So and fund our constant, the through But holders. we credit cash enterprise we see expect if over should that move value to on that keeping of

having think and as reducing So -- targeting we our debt total what well. would net that's we're

flow organically great So that, have through we we on make cash focused free business a cash free and flow. are think changes those we in to

Gary Guidry

taking asset We essentially company. of that that, not of and to see Ecuador Canadian the to benefit is Canadian is are team Ecuador in Canada iX. completely all very we a that bring that then happening Colombia, training. operating our integrated iX, the to really throughout large that benefit are to came technology And being from transfer, integration things on able integrate, that very some pleased a across of Western team, for vice just in the The Colombia versa, basin team and with we're

we company, gone benefit for and forward huge as and step a And so a the the has quite integration see well. it

Operator

the JPMorgan. Andrade next line of comes Our question Alejandra from with

Alejandra Andrade Carrillo

just X questions. I had

an little the bit Colombia know were I just see in could wanted of I kind Colombia you a the line. wanted we then you've to separate committed negotiating also, additional possibility were business the additional where discounts if to discussed I just you in past talk of versus And in of First, process lines. kind about ask, if that to the specifically. others, of

Ryan Ellson

discount $X. Castilla Columbia, last from the And Vasconia narrowed was to to has $X. $X around It's Thanks questions. gone $X to for $X the Yes, with $X. year to

tightening drop in to tariff talks from significant tariff a but seen those result of talks as not discounts. And Mexico a we've well. and of Canada So -- just talk of on production also Mexico

you've So up seen tighten crudes in of some the really Colombia. heavier

know, of get tidewater. As barrels there's to to your you lots ways

globally up to on a natural heavies. it's the for make So of the counterparty some seen shortfalls

as then lines, And as still we're working on that. far yes,

cost. our And Colombia, closed bit We expect really choice quite our a bit -- higher. for that's -- then an facility have looking $XX The And have we potential is on undrawn quite quarter capped expect next. a are a to obviously borrowing that high still we just million. in base minimize adding we is Canada in or standby borrowing at and working this early line base to for

Operator

comes Capital question with of line the Mann next RBC Our Rob from Markets.

Robert Mann

me Just X for here. quick ones

your your is that is year? could this LNG of me. touched secondly, for of being, Phase online I portfolio, you coming Iguana for at curious information you portion this X Ryan, any you natural first The there That's share the expectations just there, can all us additional exploration Canada know time? well give it on on bit And gas relatively but if although small a impact the a

Gary Guidry

got Rob. into Iguana. one Great, I'll first and on we're the well completion program just the take now. cased We've

the next testing coming be next. in will So coming weeks,

Ryan Ellson

on And natural be still it view was choppy. long-term think with year, to we gas. respect fairly When we taking gas, a natural natural yes, to purchased iX, this gas

CAD hedge So X.XX budget we have that using year fairly for of I And a we're do this think the position. pricing. is AECO large

that hedged we're So level. over

to choppy. we're we longer on Short be bullish expect term, term, little gas. a So XXXX very natural

of about markets. to have the you impact, obviously domestic the production Shell huge a out, pointed As XX% export LNG taking will

Operator

with of Josef Schachter question SER. comes next from line Our the

Josef Schachter

the kind between more is Ryan. of X. of debt the debt $XXX narrow what the above you the down goal on question cheapness or the more improve, the of debt or debt that, for you flow faster discount balance First goal, If on cash Do NCIB guidance million knock see at net the given for NAV. free a end -- Thank to 'XX. prices there's the if or

Ryan Ellson

plan XX% Yes. XX% a share flow reduction our X, put the -- cash debt balance free question. flow to of and We Yes, free additional yes. to to between Great cash repurchases.

Josef Schachter

in there. election politics Gary. building between issues an it the is business and for and gather I Ecuador there's coming One a oil Okay. at there right Or the that we up. terms looking impacting worked in which patch? central government for along left Are continue the you well same way, of will out has

Gary Guidry

Yes.

I just did to think round, him expect to in vote. and round round, going the of election fully win the first forward. expected couple achieved ago. President first higher better occurred going It's we of a the a the percentage than the second weeks Noboa

And approach, approach conservative the in so continue the business-friendly with country.

Josef Schachter

A supporting Good. break just the the Colombia, country. annual million program Okay. the material down to year. the technical number -- there, you Ecuador under increases $XX this be stabilize report, for say, declines we reserves XXXX, production at in in by that $XX you is the In million modeling for question should revisions, able well end of there Sebastian. for the of Is And Or at but Canada? have in the year I'll end that?

Sebastien Morin

should be reserve whole I the for because replacement got No, plan able you essentially we've outlined model and year. our maintain to that think

So I quite feel comfortable maintaining with that.

Josef Schachter

noncore you thoughts on today below again, this one's Any to for sell be is Gary. one, that support? more get things now. of $X.XX Okay. to not assets? market $X, and the shareholder what being was can there do Last stock market reaction The can down The stock. Any very there nice done, thoughts

Gary Guidry

Yes.

in our stock, noncore going assets I back up significant to shore I going Canada. to but We the the the always trading question toolbox Colombia balance sheet, shore -- But think doing PDP to continue the also answer in one, some Ecuador, is the we're number to with that forward. consolidate and We're up to one going in only shares. at think and the quite your tool mentioned, -- our areas Western continue bits to other in at here well back primary drill forward. Ryan buy discount we'll buying look continue a is just

Operator

further there questions Please continue. time. are no Gentlemen, this at

Gary Guidry

all work us commitment their I you also forward like our opportunity thank this and for Gran speaking quarter on the process. look thanking for once our the I'd for Thank of again hard continued We support. would take to shareholders team and joining like and everyone to thank next to to Tierra today. during you. in update you XXXX, their ongoing with

Operator

This for your participation. concludes call. today's conference Thank you

You may disconnect. now

Gran Tierra Energy (GTE) 24 Feb 252024 Q4 Earnings call transcript