GPRK - Earnings call transcript Q1 2024

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Operator

Good morning, and welcome to the GeoPark Limited Conference Call following the results announcement for the first quarter ended March 31, 2024. [Operator Instructions] If you do not have a copy of the press release, it is available at the Invest with Us section on the company's corporate website at www.geopark.com. A replay of today's call may be accessed through this webcast in the Invest with Us section of the GeoPark corporate website.

Before we continue, please note that certain statements contained in the results press release and on this conference call are forward-looking statements rather than historical facts and are subject to risks and uncertainties that could cause actual results to differ materially from those described. With respect to such forward-looking statements, the company seeks protections afforded by the Private Securities Litigation Reform Act of 1995. These risks include a variety of factors, including competitive development and risk factors listed from time to time in the company's SEC reports and public releases. not to to principal described business. All differ forward-looking stated but intended cause that in U.S. financial are a in with statements results represent IFRS and actual materially are in figures risks included identify of were factors certain could the complete here Those list to prepared company's accordance intended from are those and otherwise noted. unless dollars Reserves figures standards. correspond to PRMS

Dalle begin. Fiore, Officer; like Shareholder Officer; to Jaime Portfolio Ocampo, Augusto from today Mr. and would is Value call the Ocampo, Caballero, Stacy GeoPark Mr. Martin over Chief to Officer; Chief Deckelman, Financial New Steimel, Chief Development and On Officer; the turn Andrés call Terrado, Zubillaga, I Chief Andrés may Director. And Officer; Rodrigo Technical you James now Ocampo. Executive Operational Chief Director; please, Operational

Andrés Ocampo

of joining the Good with a performance share from gross important and first had base project to XX,XXX day horizontal is significant our blocks. repurchases, quarter flooding morning, metrics. The conference XX combination highest a in and acquisition on core progress well barrels to In business, our and water a the program attractive to and decarbonization our April, increased months. our XX took a the positive continuing our results in level business and transformational you results. the both range deliver all the underlying of thank XX,XXX in We asset, CPO-X sustainability Today, report production impressive and results strong very very the Llanos production last Llanos new early coming proud of first elements quarter XX, and business and base to for improved we're big call. solid key strategy,

CPO-X With over production reached barrels of a Indico-X the April, block the development XX,XXX the a new in day, record. well addition

generating XX%. were results financial quarter in of margin strong, EBITDA with over a million first $XXX Our adjusted

closed access $XXX to financing. In cash And our our of more our Dutch maintain our balance sheet declared in in by reducing commitment GeoPark market dividend to last approximately continuing during invested million cap, XX the dollar remained we $XXX be Board return our tender highest business immediate last well of remained over long-term million than gives strong to we million. our flow, around and in The competitive $X.X Xx our we just target million generated X as just and as repurchased for and $XX offer, shares with and to debt dividends further sheet XX%. yielded on X%. prepayment Net ended a our to EBITDA. added stock GeoPark XX.X to of X.Xx. We buybacks quarter, was $XXX almost to an invested in During value June $X.XX month, quarter leverage last while shareholders. This commercial to the million return years, in months Vitol and million, distributed position well the at the improves as every and has in cash creditors the XX. employed capital almost with of shareholders the X.Xx to the up The facility, X our years, the X which successfully was terms capital outstanding below discipline, paid net prepayment free facility providing us repayment, access strong balance adjusted that offtake a oil base to on flexible recently proof a

oil among equivalent XX.X XX% the we report intensity we're peers. of that Sustainability We emissions kilos published our to have also have recently COX upstream per gas for lowest which by from American Latin our highlights XXXX, Report that reduced extremely greenhouse SPEED carbon barrel, we XXXX. At proud intensity our

Mora barrels put XX% XX,XXX in the be pad about X our a play. of Vaca ninth which Our pads years now, X X of in a exploration unconventional before wells The with in per expansion, of expected base XX,XXX new transformational plateau exploration of kilos cash of further equivalent end been nearly of to the to Argentina, December this and June. This imminent XX% being high-quality X significant closing XXX significant our built daily locations. execution currently and within fastest-growing first and growth Approximately $XXX respect per years, close to to XP a first and production, expected interest barrels the reserves completed day assets XX significant even with Llanos next to this production. more to annual production production to at $XXX with price is part over producing the to about of purchase well is million is of certification, XXXX, the working COX of Monday of as asset part wells GeoPark beyond X% add this of a an net year net after-tax X.Xx contingent XX% or acquisition includes production on upside to ago versus $XX the and could prices. a transaction, strategic Mora day the announced which than drilled Mata nearly production. EBITDA exploration than in grow production locations, working Norte Mata at spudded between is from $XXX a which by XX A was drilling total net interest, XC-certified X XXX CAGR transaction equivalent existing has of provide fast-growing Brent and portfolio Norte XX supplies was to over day our Mora plateau exploration production, flow already million resources a additional drilling world's gross quarter combination XX% in oil could the reserve barrel. With increase in X.Xx Muerta to remaining current remarkably Upon the first expect more Mata upside. The Xx million oil expected of and block, and intensity X,XXX low asset tangible X,XXX barrels Colombia's of $XX full Norte. An include barrels of million to Block multiple million to which month. to oil XX during of the million we at which had XX% we at on nearly of NPVXX X barrels also grow estimated

in ventures, entire and being strategic Phoenix impressive at have a delivering competitive new the world's of with Vaca earlier experience achieved We're The this on their every operating in the more decade completion, costs state, bringing in current play job Phoenix with have days. new these well. This and partnering happy of prior has be teams gas done also Muerta of partner, We improvements and assets Phoenix highly have drilling, very Group, incorporated leading leadership new and Mercuria one than in of part at also with and team, Phoenix Muerta Resources, taken production an and oil initiative. the further growth Vaca both the to derisking Mercuria at the proud of trading is companies. and technical part a which significant Global to energy

hydrocarbons new high-impact busy assets. We guarantee companies our Vaca base as activity both in our and existing changing energy underway energy We with We you. our a forward upcoming well to an with in catalysts, our American consolidating drilling rapidly have reporting the as in exciting world. that very Muerta and XXXX Latin core asset have activity started committed to sustainable year drilling producing leading some look among closing reliability, to and progress affordability security, and remain position this beyond

have. you We questions will you. now to any Thank be happy take that may

Operator

comes first question our from from And Demichelis Instructions] Alejandro [Operator Jefferies.

Alejandro Anibal Demichelis

I Vaca we That having was first first CapEx now Maybe extra Three the Andrés, of one, of may. about if returns and years? next the between shareholders should balance that is CapEx, Muerta, cash questions, free the couple to question. flow, so more kind over going think cash the to you're how

program an the do conducting at Second question of risk oil please side in third doing getting much is that the that the on acreage us on heavier new see is, you're delineation the the on And what been where of could have CPO-X? basin, you question the and Vaca provide update then the you appraisal on exploration, you Muerta please?

Jaime Caballero Uribe

production And and plateau that $X.X production right? It's we first shareholder an around goal Muerta returns? of a you you going CapEx announced if barrels base to In to around previously. When So bit already the the we reach imply escalate. We we gradually it's detail little about is Alejandro, question, it's retain I'm CapEx first expect X and you to there be the going years, it Jaime. into this its that XX and profile Mata kind does get incremental and Muerta to how years angles address which affect see bit get of of next to billion order look tackles will, about to entry a case talk to over going is it, a Vaca more going the your see what CapEx X $XXX XX,XXX year, to Vaca to going our profile XXXX. I capital understand there, this I'm as at million. give in Mora and of possibly profile for time. particular, exposure is X, little around

a to of about $XXX year, peak Next getting million million, around million, $XXX XXXX. $XXX

take So that's to going it's in order what get there. to

clearly an to that of the per is obviously $XX. there a EBITDA that seeing getting at million in going $XXX contribution incremental value-accretive million annum to significant for have to we Now is need where the $XXX deal we're company. company context, to between This EBITDA put a

So off and this we shareholder is return is to context, the going cash generated, seeing to it's sustain deal allow paying that with our in strategy. itself over us what time, are by cash its own flexibility that

million per our we're over the near deck, -- we Last At $XX are you that in example. the to distributions we annum. is existing million current $X.X our performed we time. any million of price had as significantly auction in to to $XX at for in first above maintaining which year. we take time, specifically, policy million, total the So $XX what million expecting just Q. the dividend earlier term, we returns noted, Dutch issue That's $XX associated about also And last April. maintain going same seeing announced what see year the We year, had don't is this in to shareholder the

I company. $X.X billion a probably going provides, is there asset the net in $X.X it capacity asset to the valuation XP be we're we what that asset $X.X returns that value said, deal that's is intrinsic associated. that's this about asset valuation it shareholders. And were goes about net all look interesting valuation covered you billion, improvement. We, seeing our our expands returns, XX% our when as XP angle billion, deal, this I When billion. all, $X.X affect these see the There returns guess to And actually given a a this deal, at XX% goes talking to before $X.X the of of a angle, But component. from net asset needs yield So of to deal this doesn't the the cash be lastly, the ability maintain XP with time. with With our to course, billion increase. provide other is over that that's to about about intensity of you're a valuation to an capital reserves that net talking to and XP another the shareholder

but all, cash So direct be on our like in intrinsic benefiting going yield angle, Martin, sides, from are to shareholders growth CPO-X? to take would the will, over we also both that if hand, time. On one Martin? CPO-X, all you believe from from you

Rodolfo Terrado

around asking, X,XXX CPO-X XX,XXX have we're for breaking question. Amerisur, you've we rig that you production we look keep Perico. not part it's and [indiscernible], formation. barrels initial very thanks remarks, put challenges, were continue low delineation I remember it's that of as completion acquired producing when records. drilling block Halcon was mentioned with XXX well, X of good really We we well, Halcon and day per performance. cut. happy Barco is at got the Andrés in November mentioned, kind with Barco water XXXX, in Andrés that now. well. And [indiscernible] drilled Alejandro, that we on like Absolutely. are They his when the we're and 'XX, We barrels your that had of Cisne. no like the doing. the ] well so we're This the water. The [ day, delineating drilling in rates, as delineating wells continues Perico delivering producing like per you oil Indico-X, with were remember, more than at X,XXX oil to got of we delineation, is

be to the called and rig exploration And that, another that well expect May. We after well by go late completing Lark. will drill

on kind that's where So of delineation. we are

have expect We that to work rig year. the full in

Rodrigo Dalle Fiore

going Rodrigo. the continuity I'm Confluencia. Technically, what there continuation to this is -- east tackle to is question Alejandro, your we a Mora of Mata part. the see about

know where example, they ] are Pan because from, during are results Of there here period, things in in how trends same confidential. regional are very oil. we course, affect wells that trends evaluation mention and example, it's good in [ like gravity always Vista for are producing good there saw the really heavy, can that where going we [indiscernible], good the we the certain API we to of the and the But for America the

view, wells. that's, with And they we deal there, the and what But barrels we DeGolyer drilling robust doing block. say see now, we also, point we course. that be And than to we have of to So X we more are have from report technical resources area. MacNaughton in of are XXX honest, a what million as from have the the where

in with that [ in We of expect this productivity rates expect the just kilometers Mora. finished had see square to this same we result And are we seismic area year. information. range optimistic this we of Mata before we and the But a complement XXX end of in line ] the also,

Alejandro Anibal Demichelis

you could the Mata rates then? confirm that see you Mora in please And Norte

Rodrigo Dalle Fiore

Mata go Norte. Yes, Mora we to can

clear per the the During XXX,XXX the by DeGolyer see and Mata They from And MacNaughton. analog outperforming. ran leading and only is a partner in in we see operator not the our evaluation neighborhoods most barrels as used million have report range very, fields. we we period, learning most producing we day, the between recent we now reserve day see these are good. at the a we of are and what range, of wells also, we a X very that wells. But the because curve, wells [indiscernible] have And XX also Mora, end a

as well You was is a see another can can than X,XXX the more you February, Mora, basin. a X,XXX day the And barrels best take Mata productivity. that example in per producer in good example, the

but and rate day. we operator adequate why that's So is the are things better we believe seeing that the is partner that moment, at doing our the also every

maybe So with seeing. that's last why this -- are expectation the we results is increasing in that

Operator

from comes question from Guardiola next BTG. Our Daniel

Daniel Guardiola

of most years. questions I know, assets. for could like upcoming plan my just don't share what the total details percentage I would the if know with Jaime, additional cover? the you share us development locations and of in Argentina. It with about first Mata if Jaime the think agreed my wells of or forecasting to CapEx Mora drilling to with total is maybe I'd I That know the for plan could acquired you size great of be are would But Phoenix question. expected this the development the on Norte I talked be us mean, identified

will second Mata details Mora already drilled be The additional the one wells. Norte on

surpass EURs the of So see be seen curve the the it average IRRs that seeing could prices flowing It'd the is net great selling very you on I still so that well. is now Mata transaction, that would oil the at its is us of which last the from X.Xx Mora my EBITDA, be with going to has and you're mean, per great to company future this to net if far type question basically Phoenix Norte. And the level. opportunities. closing which debt and share leverage after very question healthy growth realized is your low, the is out third understanding

main be will doing at would all. another features similar be acquisition? will I your what this like So on about looking the you're to That thoughts will when if acquisitions it, additional thinking be And you know to one.

Jaime Caballero Uribe

I'm to Mora made, is it's little try to us a it a I'm Rodrigo bit of give Daniel, over Jaime to questions then around going you to date. Norte and here. the going to color number Mata going that who cover and more pass

development joint question, a to where notion, our the are partner So and essentially of And explore Mora first is your this commercialization. seeing to take a let's barrels that was clear pace plan start which asset. And and why first XX,XXX And to alignment hopefully Phoenix is Mata I with scale with to that around frankly, there add start here the we blocks we philosophy. have us, that. of X decided vision to one we partner which Confluencia we day. parallel, want where decided to and over with around going with to and economies fully we're of massive take is development why a would that to Phoenix time the wanted key is In want what development even reasons

them do, And we've can So that's program release barrels to aiming extract between what us years. The right? that budget we're work that takes anywhere within day X XX,XXX barrels reflects with a our vision essentially that. to agreed to you from that XX,XXX

how quoted to identified you Confluencia maturity locations, Obviously, success and its you for that with So drilling associated committed quite sustaining actually firm to it's this thing underpins program rig. that's to derisking Essentially, a we've Confluencia we've pursue to essentially, in seen, There's actual one X-rig a if firm -- And it's actually over the them. XXX Mata how about that Same translate we component those what the seeing with that case. we're further numbers see the what time. what so will, you've want that. But Currently, are remaining of committed us That's and together that's terms is Phoenix, Jointly, we've in numbers Mora, numbers. develop. does Phoenix. activity? in applies quoting. we research with it's there's behind, not what

hopefully, the rig with XXX later -- numbers seeing we arise. it. The that, in we're come Daniel, next will hopper That's a essentially part other and thinking how The through CapEx this about wells as after going the in consistent program as second we're are go quoted, options that question I of X-rig of to essentially year. indefinitely more And previous is options that. drilling sustained indefinitely,

the well cost, wells, to If you it's XXX take given essentially to going place. of the numbers you that do

prices. me realized ratios the what angles Let Daniel, production Those is we're -- change and here. There there's sold that to say cover that average are markets, and going now Essentially, is we over goes to international what X is production domestically. seeing there's time. I expecting, would are

look If that's been you the history, the case. at

is So we're about we least thumb, sustain it. But cannot we be that XX% seeing. too of to markets. what international a as what can sales I suggest are domestic and rule go would at XX% of about That's deterministic can

change the of evolves. and But seeing. and are growing think going as that's course, that going evolves that change very is time well. direction quickly, to that over conditions is market we're speaking, basin that's as This I as around generally it a matures the the infrastructure to commercial

to Argentina that the a barrels well of met, in refining I XX% sector we're the we that we this seeing going modeling surplus, are differentials Brent. the whereby in flexibility $XX that that think that the the as That's what allows are needs that very we at forward are sort are seeing of for exported, $XX can development. be underpins look so that range is to and of are we of discount now The volumes. seeing export sort of assumption, versus

X.X, you the net not already In of Daniel, reported, that we're seeing, that the terms to over term. near exceed number leverage, of that's kind

capital scenarios, no, if a it capital -- at a Confluencia, there's we that. We think or intensity that increase I scenarios. even that and right, with our production, success high we right reach modeled could in actually possibly, increase, -- a those those that the in associated reserves, but will scenarios, X.X, X.X don't price will level. is what we to in that very the X substantial And that. change could change reasons angles even possibly are even I Leverage, case have for our in EBITDA in think those

approvals all going be partner that is time. end, in So discussing. about have has. our efficiently that that us need the of that are What opportunities. The need deliver that that ultimately get attractive That clearly, our is This a is firepower kind term, a inorganic plan, we portfolio. this deals. to to the on and to means to next up I to in securing to making idea our way going to the progress processes this assets gives setting the up going is development to focus performance with how our work do this it's We're we this transaction quality our going going set and it big is delivering brand evolving within development that provincial high-quality with will the engage allow sense, that near of the been around you like we now to an we're management the we've with we get with clearly Phoenix And effectively GeoPark. over promise that is we of can a remaining as We're frame value and with it incorporation profile existing placing organic in the get market deal. months. We're the this investment to few right in a for team closed plan be into and And we're priority. right. And how that Phoenix second have that conversations to is collaborate

that, options, we to sense will the And be -- us. strategic stop aspirations our So that said clearly growth not options at priority. Having looking continue do for we that's here. make

very prior eloquent Andrés the in about Andrés, think, Daniel, this, our aspiration. I when was about call, you pan-regional asked

and is Argentina not in that the as It's would Brazil, at unchanged need be petroleum And is I shows we continue that sense that this with and But that, will in, we us. to that. to world-class end. transaction we the say have that's of it's for end. transaction. Actually, the and strong what options We believers basins evident demonstrates quality of Colombia, that this make -- not look are

that So covered. answer I know that I was a long

of covered questions. Over X I Rodrigo. think I your to X

Rodrigo Dalle Fiore

Thank in you, this Daniel, an Jaime. this and Hello, between We time Norte that wells Mata see area. put frame, let Rodrigo. Most is of seeing. a poor is range we frame as first what a wells because in But we than a the average clear million learning X recent the area that curve looks set me in the here. Mora the are barrels XXX,XXX in

in have what that So the CX, job operator also the wells productivity. not call the the order least better we improve landing definition, we very other it, great doing landing in [indiscernible] or drill only are they is from the but aspect where they switch at that but is because that to we operational way see means area to a wells they in zones started a new

of So that learning part that's we curve seeing. are the

a see So this, that as and X the initial at to that's that if the area between well summary X,XXX day in least X,XXX estimation peak I can a why the we a produce had is for months. first barrels

X,XXX wells per the wells more seeing are we than -- day. most barrels Now producing X,XXX of

producing are that news field. months, It's activity we this the trend we of most carry So that's the for in but a that for we last reason X wells the us. see out about are definitely, the in great because talking

So deal, a great that's for and news a us of course. for

optimistic $XX reduce at than the the Another of more thing we cost. with eyes the is the They cost that able million see to well beginning. well were

before to finish well. expect -- per year Now they drilling and million, $XX.X million are $XX we the to close between

that's So intention what That's too. we operator of of and, our intention, expect. course, the the

seeing plan. terms costs. So are productivity, you course, the asked of And in of well about that's what we

them. mentioned, wells Jaime to that plan we a expect And that's the develop minimum have as we the with As area. the point in XXX

Andrés Ocampo

he asked from -- think IRRs I about IRRs wells. expected also the

Rodrigo Dalle Fiore

for XX%. is course, we XX% IRR are Thank seeing range, a reminding. The and of you between but

Operator

Our next question from Canaccord. Roman from comes Rossi

Roman Rossi

and Congrats results the on acquisition announced. the

like terms undrawn to what's understand -- what the X.XX%, but are have sense you would And does after the wanted it's additionally, fund cash how a regarding you beyond get much expecting use to target just cost to the mentioned acquisition? Vitol. it the acquisition? associated? I So for the with SOFR an facility And plus are

Jaime Caballero Uribe

Hello, are Roman. Vitol cover you? me How question. the Let

start that would performance. It's an optionality commercial deal, a but is saying commercial it's plus. with I Vitol So starts the performance. it underpinning, Financing the about being upside,

covers deal is commercial production. XX realizations. see commercial very Llanos coming for this discount competitive our and that as secures better improved So a differential That price actually something across we're going to

is this performance were I does optionality. financing significant deliveries, this think The X, we've improvement we quoted seeing commercial the that engaging that what in thing ago. a it a of X deal. the provide $X.XX in that nice statement type beyond represents over years And that's this prime for motivator

key making financing sort on a the extends any interest we and that us of today. It in without that would you favorably plus committed bond X.XX% any period year with this and end It competitive It which bond in own get SOFR any at if interest, the -- until very time X% draw it repaid the reported at has in that's we grace So line, has unsecured. term. compares even longer-term very be It terms payments a about time. the also have can interest. $XXX Vitol we million of are existing near that the the our market is can gives draw

thing that's So and options keeps adjust financing longer-term it we fully actually do to that. if to the the our available believe market convenient for if us conditions

general the of framework. So kind like that's

In deal, I this think terms stand about deal. how of we let back more approaching our line, Vaca that it the think about Muerta plans actually and the talk are we with is, that broadly me way

we at million tell balance cash, been with our look no had, paying we those million. $XX numbers at That's the $XXX that the paid, me deal, that paid remaining the in of existing and that already $XX you paid was when there signing, million you right, statement. basically, let quoted cash we actually, whatsoever. And after already with So own financing the we

With So and million bank, that big the to balance we currently, already entire the gone we in consideration is upfront this deal. paid at essentially consideration cover pay $XXX that million upfront the next of be at deal. The of the we have closing, to that $XXX through balance need need that's the closing. the in deal and is milestone that,

is we this to wells that And that go That's are when to The going are that's other what $XXX thing is that year about to year. in is to we this at CapEx estimate the the our we Confluencia this. carry of million. look consider going that, we need the represent expecting estimating component parallel

that have. How means that? what of represent are going surplus It's cash year, remainder extra the finance million that to be the an So the the plan going $XXX likely is at that to combination versus these a are going that we this of is deal prices. in to we we accumulating

could total I will by Vitol that, that We and the year, it $X this If do of the facility. it's way likely, this an is modeling standpoint. to would represents a in see million it price deck. to an figure next covered interest this year month the as we amortizations surplus I about start that would $XXX remainder, monthly indication period. with and the that going facility you financing about And underpin grace are effort. And year this cash you're this, caveat give using That's think about indication payments at the a month. an for If January this the of cash because we -- of you we important no from have million very flexibility accumulating on every flexible Vitol give use to

Roman Rossi

on a QX you follow-up in Great. maybe Do that expect your quarter financials, And you right? the impacting to acquisition. fourth be that say close will so

Jaime Caballero Uribe

Roman. Yes,

So I X things, this, there's you need milestones basically X on consider. think to key

is closing and there effective there is think an the date date. then I

and closing, of regardless me let So define closing.

the of are deal purposes and this Phoenix for So the complete. fully GeoPark private deal, between

irrevocable. complete, So is it's that deal

We us. between have an agreement

That's provide provinces that So through so that the approval if this. And the in we're río leaseholder, Argentina there We to Neuquen in an X we we Now when talking for need a approval as we bid about an on we we you referred of to for aspects. are, Negro come Mora, in need in that talk leaseholder. will, equivalent closing Mata closing, public Confluencia. the right? a about approval are what really and need regulatory the

that of So that we are next triggers months. to expecting things. I previously the that occurs, $XXX When occur to mentioned payments within million the that few

July. Despite be the what that's or effective So Xst to. to date is said refers closing of that having going the that,

of aspects starting Xst already are economic the deal effective July. of the this on So

assume What is accounting in an you're So XQ, let's what see financial Q the and see going you're in X,XXX, we of anywhere to on subject basis, day a accounting? of see line-by-line you're look end of barrels date, fully closing the indication at see the X,XXX basis. basis, the start deal that, into XQ, how translate performance, to statements, to Well, we the going production. is going of to by this of close that between all XX-XX we fourth right? As to extra to on a that XX% going that this consolidated the is that

share You're to a see costs. of going

lines the all different what see this to going deal implies. You're

the additional of $XX time. are what for we would this what at estimating you be XQ should expecting line, On be EBITDA That's around EBITDA an million.

start message of regardless effects fluid the starts to Xst going to date. to there. it's line. here closing, So if bottom but consolidation July, the have But that That's post of would be is give you closing economic I from a

Roman Rossi

question on Awesome. And last Colombia. one just

a So Constitutional the hearing public the Court of royalties. a at days nondeductibility ago, regarding there of was couple

the to for on want one front? is is which have the nondeductibility XXXX, that get. to And that do say government comments keep they valid you of that any alternatives trying So the

So GeoPark? will will for that how you need pay more taxes or to work

Jaime Caballero Uribe

Sure, Roman.

provide let broader of on kind So context me some this.

surcharge is tax in in discussion That's linked had as components. the had tax. a to environment price reform surcharge in last what's really, that's not approved X that it's on was of part that corporate the to That XX%. place, from X So the went It reform discussion. tax year,

willingness presented The time. of happened that (sic) Court government other willingness the Constitutional by has requested that but was by Court. has the Court the review. that like not decision a on final the recourse is they What royalties, that declared on the What a Constitutional which hearing perform ] [ component at a unconstitutional it inconstitutional whereby to second Constitutional to review, the is perform communicated was the nondeductibility

they do While that, the still prior decision stands.

make decision of are decision made actually are -- that the that So in they declaring right? of What that this are the Companies at around season. is unconstitutional. in time May, tax the tax unconstitutional. this means which we how deductibility already season, prevails to for that is that Court we So is suspend not a had calculating What that Constitutional decision royalties. is does are going that,

at the going what will to happen not decision, unconstitutional, the its act right? least effect Constitutional And of XXXX. an we on now recognition to Court GeoPark, year's was previous right? And be a decides later is paid basis reconsider form some what for in that declaration, that, So that's have could this on are next could of on there

While the estimated around it I estimate impact, it fluctuating to have that. pieces time, the are range There have we is rough on have on moving to volumes. stated paid $XX a to that we $XX It associated like because million things we that, as some million. depends That's royalties between that. estimated

$XX So million million $XX in range. we estimated the to

the that guidance, the November. operating our any XXXX announced reform. under full have we At provided way have -- Importantly, remember that the year the assumed that on we time, actually in this to doesn't the because in provided actually the guys we around this back were impact it we was existing at guidance we you time, that plan EBITDA, that that tax

is ultimately, timing inconstitutional If (sic) the the for to not upside case, as goes contesting downside. us, is So of this is this confirmed upside. an going And this ]. idea government's this right? this it's -- an is represent it and forward, if to our unconstitutional [

Roman Rossi

the again acquisition. on Awesome. Contracts Okay.

Operator

from question our Oriana comes And next Covault from Balanz.

Oriana Covault

but Many the of of couple have on I one Vaca them have follow-ups Muerta -- a been acquisition. answered already,

completion the you $XX to First, understanding that ] it's [ costs prices the regarding my been shared, million per that $XX million in local have and well. development

understand are acquisition, numbers could how to right, color if repatriating targeting, the you're that area things, Muerta specifics? profit regulatory if seeing this side of your possibility landscape from one discounts. on ongoing? And potential one expecting if seeing quality operations just with discounts? those to terms once of the comment you the related on of end. And you are Congratulations of entry last regarding potentially are terms what quality difference lower So But Vaca this on into you're in of of refineries the on any any, Vitol. of the the kind agreement you additional commission oil? they seeing the understand And/or from what the between crude to in have. color would if to benefit it's share helpful a be because exports operations of -- just you you're also Could you and of could That

Andrés Ocampo

is Andrés. this Oriana,

Your line noisy. comes little bit a

if Let correctly. see if to your questions am me repeat, I we understood

that to assets? cost respect and completion with of the wells is we the estimating for drilling these question first Your are

Oriana Covault

in completion has reporting area. It the with to same costs Yes. and what local the peers to have been compared do drilling

to closer per is that understanding well. it Our perhaps $XX million is

you the to the also the color share on understand something challenges could one see of follow-up whether to So is has them potential of the the where do the to the And going Vaca difference what transaction, remainder seeing. And with do additional taking regulatory from additional if may area-specific or that year. to see operations. Muerta has discounts the you're just through you you on quality with the last do and profits

Andrés Ocampo

controls is on quality and second crude correct? one last related one sales, the the the in capital Argentina So to to discounts

Oriana Covault

Yes.

Sorry for the trouble with the line.

Andrés Ocampo

okay. That's No, no, that's okay.

Rodrigo? So

Rodrigo Dalle Fiore

remind years million It's $XX was to close per the ago drilling to This costs that well. is here. important Rodrigo X

-- 'XX, well, in with end that's year the last so a tremendous $XX.X per the improvement. Now the million

Of services course, also learn getting but prices the introduced they is this because and they down. technology

So we about X million that's in million rig for we the the the drilling future used trend per that an the $XX.X per $XX.X are extra in well. But after area, model 'XX, next for with talking we see years, well.

trend see not base the that that's in to see drilling a here efficiency have. what Permian, continually the at wells you in improving. can is it's case same in trend time, we the in terms Argentina, only But So but of trend the is be we honest, same

future performance use that why cost expect that's model. cost. lower So we in and for But the better the we the that's

Jaime Caballero Uribe

Muerta several think seeing at look per operator, who trend, consistent the Oriana, is DeGolyer cost the trend time. Vaca to But we're there's thing important here. is is of of I guess, well I is benchmarking, terms I considerations in [ improving your ] around what over Regardless a your right? think in most the where

they cost the well the specific that robust and that locations to we as think that view something do that we end. It of you there deal use. is is of around use to differences has not. and are mentioning, and with where us the that synergies the comfortable geographies to very it expect, the I everything. believe $XX The are so operating operating designs that prefer characterized that million per from or you're far. That's maintain to $XX We well depends that standards that. can operator. a would ensures alignment That's operator the a attracted standards case. It have of well, depends on always allow in to requirement million standards actually conservative that of assumption this on ensure more we with need and Phoenix certain and to integrity quality Phoenix the ways And you we're low this

to the to Oriana, banking change are course, possible. In the can to not developments the under type into even are transaction in be there this those economics. I a is the the right? Surely, very the capacities. to the do time, allocate great you with seeing regulator exports of and that about news. With and near of other needs we're years, is want over that on upsides important under this can it have in quality that of growth program fly a develop I'd a between issue into that think at scenario associated that options -- going and of long consideration say is fund going those that that to with you regards stay the would do balance of this between Vaca about you over EBITDA we in But that the next refining in question, Argentina it's over money is goals regulation. And that as big the there's to the impact the asset what that not prior can right? the we actually and is up that particularly we quickly to of Muerta generate mentioned stressed fully domestic the medium you And the of that and environment, surplus any such way relative good sales, of Oriana, to exports is though that environment, to top term, could on we regulatory sure fundamentally is So that even the I that is What the be the to as grow look and the to thing discussion where biggest a is to make all a influx fluid. seeing positive program, and is, and that out over existing to trend. grow, we've questions, that are I that alter of we're these controls suggest that we capital is coming profile winds and return. this going regulatory that biggest deal evolution at you clear where the if looked country growth time going domestic the the to going be needed. that requirements consideration that's the And term, is -- the be in the how that because in our discounts sure challenges grow is we underpin Argentina the and before, we're upside seeing your it million quality expect production of a going lastly, how the anything trend that Argentina, asset what existing is will regards the when grows, term. I'm Surely, near the distribute X delivered that the the allows all is we -- regulatory of this and controls confident on $XX.X just operators between transaction think structured grow to that revenues that do and to of say capital that that I we're come priority talked and time. asset,

in scenarios, not even So a those that concern. is

if can will, that to way the obviously, if So extent you with the free a market represent to perfect going conditions, that fully develops you have, in -- you Argentina in a upside this that's only market to deal.

Oriana Covault

Yes.

Colombian was on clear, one because discounts. I I of fully maybe referring more quality Just side wasn't the but follow-up

of because ] seeing understand angle fewer your to you Just potentially [indiscernible] low-cost having those of exports heavy That was out this. a the evolution into entry of more upside potential the [indiscernible]. crude of of refinery into the [ are of operations how

Jaime Caballero Uribe

Yes, clarifying, sure. for Thanks Oriana.

a there. start in is exploration remainder, extremely market say fundamentals the our the existing of that production, which attractive on maintain the in about already of for Putumayo. XX,XXX which And $X for we're getting In conditions is which that guess We a Colombia, that give on going is seeing and crude Brent I'd to about direction. CPO-X deal. kind to I secured in them of Vitol can commercial premium. we that, a that. existing bulk about barrel are the talking differentials we're a positive all or XX, broader That local differentials for refineries barrels really premium of commercial a combination that a are of Llanos you're seeing, those super case, the believe We're high-quality take. what the XX covers actually more then actually Colombia. The of a and CPO-X, is kind a is So our production, Llanos view I'll then simpler with we've of

optimistic CPO-X. get for we very So we're about the commercial can that differentials

development players make export interested interesting quite Oriente are actually On of them the special what seeing associated front, an blends, getting where volumes on to able the they're Pacific Putumayo in those number front, that. is through we're or a to because blends

you, can you XQ, saw medium the that overall, of So in we believe the would I we term. tell over is them Oriana, what sustain that differentials sort

Operator

our next And from question Andrade comes Alejandra from JPMorgan.

Alejandra Andrade Carrillo

because needed just still a that you quick transportation transportation. already Mine wondering that was for Argentina, in proper you said and a built said the for order there be one. in infrastructure have infrastructure pipeline some I is to have know existing exports to all you but

little on if So just that. bit you could a more wondering comment

Jaime Caballero Uribe

Jaime. Alejandra, is this

in entry access transaction, provides need make -- yes, that, of day. equivalent be fully about So barrels barrels X,XXX [indiscernible] Essentially, that XXXX. Of pipeline with by midstream April into about construction as a already to the we the delivered we effectively, part of is capacity work. secured that a we've deal an the are the pipeline per place, of to the capacity secured XX,XXX and day this is under and to us the expected

to covers export for for of a already. years. pipeline secured with the production, we expecting ports are that about that to XX% place. over in capacity about redundant the transport starting ability in projects that in that to have But to to production that have in where we essentially have additional rights access in the capacity access secured infrastructure market it there's XX,XXX plateau So what I other of to plateau, come open Argentina. when deal, the there And by to optionality to is XX% to There's couple which place this about time, that. way we're going And the there's near construct other respect we So are also day next of think that going the get particular, to we are to capability that's is mentioned. That is fully right? -- barrels

Operator

will We over currently Andrés have no to to back I hand further questions. Ocampo conclude.

Andrés Ocampo

field We to or for further to call time in us visit information. questions us any everybody, We're interest our any for your you our and may operations support your and have. you, Thank our answer of you company. encourage always here

day. you, have a good and thank So

Operator

you Thank concludes today's joining. call. this And for

You may lines. now your disconnect

GeoPark Limited (GPRK) 16 May 242024 Q1 Earnings call transcript