Gran Tierra Energy Reports Significant Oil Discovery in Ecuador and Strategic Divestment in Canada

Gran Tierra Energy Inc. has reported a seventh oil discovery in Ecuador, confirming substantial potential in the Arawana/Zabaleta field area. The company is also divesting 50 percent of its Simonette Montney assets to Logan Energy Corp. for approximately $37.11 million, retaining a significant interest in the area while aligning with its corporate growth strategy.

Gran Tierra Energy Inc. has announced a significant oil discovery in Ecuador, marking its seventh successful find in the region. The Calgary-based company reported that its Zabaleta-K1 well, the fourth exploration well drilled in the Chanangue Block, confirmed the substantial potential of the Arawana/Zabaleta field area. The successful testing at Zabaleta reinforces the established Basal Tena geological model, located four kilometers from the Arawana-J1 well, thereby supporting the viability of the productive trend within the Arawana/Zabaleta region.

Following the discovery, Gran Tierra has initiated production testing and moved the drilling rig to commence work on the Zabaleta Oeste exploration well, which began drilling on November 21. This exploration initiative fulfills the company’s final commitment within the Chanangue block. Gran Tierra President and CEO Gary Guidry emphasized that this success enhances their understanding of the field and will play a crucial role in their development growth strategy in South America.

In addition to the Ecuador discovery, Gran Tierra is engaging in a strategic divestment of 50 percent of its Simonette Montney assets to Logan Energy Corp. for approximately $37.11 million (CAD 52 million). Gran Tierra will retain a 50 percent working interest in these assets, which include approximately 25 net sections and substantial proved reserves. This transaction aligns with Gran Tierra’s long-term value creation strategy and is expected to close by the end of 2024, subject to customary conditions. The partnership with Logan Energy will facilitate accelerated development and generate near-term cash flow, which Gran Tierra intends to utilize for shareholder value initiatives and strengthening its balance sheet.

The oil and gas industry continually seeks new reserves to sustain its operations and support future growth. Gran Tierra Energy Inc., a firm based in Calgary, Alberta, has made considerable investments in exploring South America, particularly Ecuador and the Montney formation in Canada. The recent discovery in Ecuador underscores the significant potential these areas hold, particularly in terms of geological models that guide exploration efforts. Furthermore, strategic partnerships and divestments such as the one with Logan Energy Corp. reflect the company’s adaptive approach to optimizing asset value while maintaining operational interests in their key projects.

Gran Tierra Energy Inc.’s recent oil discovery in Ecuador substantiates the considerable potential of the Arawana/Zabaleta field and enhances its growth trajectory in South America. The strategic divestment of a portion of its Simonette Montney assets to Logan Energy Corp. further exemplifies the company’s commitment to long-term value creation while ensuring continued interest in its key resource areas. As Gran Tierra navigates these developments, it positions itself favorably for sustained growth and enhanced shareholder value in the oil and gas sector.

Original Source: www.rigzone.com