Gran Tierra Vitality Inc. Appoints New Director

Gary Guidry, President and Chief Govt Officer of Gran Tierra, commented: “Throughout 2022, Gran Tierra achieved sturdy 126% (1P), 148% (2P) and 280% (3P) reserves substitute via our profitable outcomes from our growth and exploration drilling, waterflooding packages and subject efficiency. We accomplished our 2022 growth plan on-budget together with waterflooding efforts and growth drilling within the Acordionero, Costayaco and Moqueta oil fields. After lowered exploration exercise throughout 2020 and 2021, the Firm additionally made a number of key exploration discoveries throughout 2022. We consider our success on a number of fronts throughout 2022 demonstrates Gran Tierra’s potential to be a full-cycle oil and gasoline exploration, growth and manufacturing firm targeted on worth creation for all our stakeholders.

The success the Firm achieved in 2022 additionally displays our ongoing conversion of reserves from the Possible to the Proved class. With 115 booked Proved plus Possible Undeveloped future drilling areas, Gran Tierra is effectively positioned to proceed to develop the Firm’s manufacturing in 2023 and past.

Throughout 2022, a mixture of our ongoing reductions in debt and per effectively drilling, completion and workover prices, give attention to sustaining low working prices, sturdy rebound in oil costs and share buybacks allowed Gran Tierra to attain web asset values per share* earlier than tax of $4.62 (1P), up 77% from 2021, and $7.36 (2P), up 56% from 2021. With this important development in our web asset values per share* in 2022, we consider Gran Tierra is effectively positioned to supply distinctive long-term stakeholder worth.

We’ve got began 2023 sturdy with year-to-date common manufacturing of roughly 33,000 bopd, which is the midpoint of our 2023 manufacturing steering. We additionally just lately drilled the Moqueta-25 growth effectively, which we count on to carry on manufacturing within the new few weeks. We’ve got secured two drilling rigs for our 2023 Acordionero and Costayaco growth drilling packages and count on to spud growth wells in each fields in early February 2023. We additionally plan to proceed to give attention to the event of our present property, appraisal of latest discoveries and new exploration drilling, whereas producing free money circulate to strengthen our stability sheet and return capital to shareholders via share buybacks.”

Highlights

2022 Yr-Finish Reserves and Values

^{* See the above tables for the definitions of web asset values per share.}

• Throughout 2022, Gran Tierra achieved:
  • Materials development in its 2022 year-end 1P NPV10 earlier than tax valuation, which elevated by 26% in comparison with 2021 year-end, and 2022 year-end 2P NPV10 earlier than tax valuation, which elevated by 25% in comparison with 2021 year-end, pushed by the Firm’s profitable growth and exploration packages and a powerful restoration in oil costs.
  • Progress within the Firm’s 2022 year-end 1P NPV10 and 2P NPV10 after tax valuations of 6% and 5% respectively, in comparison with 2021 year-end, which integrated the brand new Colombian tax regime. The brand new Colombian tax regime lowered the Firm’s NPV10 after tax in all reserves classes by roughly 8% to 12% relative to the earlier tax regime.
  • Robust reserves substitute ratios of:
    • 126% 1P, with 1P reserves additions of 14 MMBOE (38% attributable to exploration discoveries).
    • 148% 2P, with 2P reserves additions of 17 MMBOE (95% attributable to exploration discoveries).
    • 280% 3P, with 3P reserves additions of 31 MMBOE (103% attributable to exploration discoveries).
  • Materials 1P reserves additions largely pushed by success with growth drilling and waterflooding outcomes at Acordionero and Costayaco, along with a number of exploration discoveries.
  • Materials 2P and 3P reserve additions via the success of the Firm’s 2022 exploration program, which made a number of discoveries.
  • Discovering and growth prices ( “F&D” ), together with change in future growth prices ( “FDC” ), on a per boe foundation of $18.18 (1P), $20.08 (2P) and $12.20 (3P).
  • Three-year common F&D, together with change in FDC, on a per boe foundation of $11.69 (PDP) and $14.51 (1P).
  • F&D recycle ratios*, together with change in FDC, of two.1 instances (1P), 1.9 instances (2P) and three.2 instances (3P).
  • Web debt-adjusted manufacturing per share ³ development of 67% since 2021.
  • Web debt-adjusted reserves per share ⁴ development of 56% (1P), 57% (2P) and 69% (3P) since 2021.
  • Vital reserves additions at Acordionero: 6 MMBOE (PDP) and eight MMBOE (1P).
  • Materials reserves additions from exploration discoveries: 5 MMBOE (1P), 16 MMBOE (2P) and 32 MMBOE (3P).
• Gran Tierra’s 4 main oil property, Acordionero, Costayaco, Moqueta and Suroriente (all on waterflood) characterize 81% of the Firm’s 1P reserves and 68% of its 2P reserves.
• The Firm is benefiting from ongoing materials price reductions for growth drilling, completions and workovers within the Acordionero oil subject, Gran Tierra’s largest oil asset:
  • The Firm drilled 22 growth wells in Acordionero throughout 2022.
  • These new wells had been drilled for a median price of roughly $1.1 million per effectively, a discount of 47% from the common for 2019.
  • These new wells’ completion prices averaged roughly $0.7 million per effectively, a discount of 41% from the common for 2019.
  • The typical 2022 workover price of an present effectively was $0.4 million per effectively, down 51% from the 2019 common.
• PDP reserves account for 56% of 1P reserves and 1P reserves account for 64% of 2P reserves, demonstrating power of the Firm’s reserves base through the potential future conversion of Possible reserves into 1P reserves and Proved Undeveloped reserves into PDP reserves.
• Gran Tierra’s mature waterflood property, Costayaco and Moqueta, continued to develop and ship worth, with complete 2022 reserves additions of two MMBOE (2P) and 1 MMBOE (2P), respectively.
• FDC are forecast to be $403 million for 1P reserves and $677 million for 2P reserves. Gran Tierra’s 2023 base case mid-point steering for money circulate** of $295 million is equal to 73% of 1P FDC and 44% of 2P FDC, which highlights the Firm’s potential potential to fund future growth capital. Will increase in FDC relative to 2021 replicate that McDaniel has now acknowledged that Gran Tierra has 78 Proved Undeveloped future drilling areas (up from 61 in 2021) and 115 Proved plus Possible Undeveloped future drilling areas (up from 94 in 2021).

2023 Manufacturing

• Gran Tierra’s 2023 year-to-date complete common Firm manufacturing is off to a powerful begin with an approximate common of 33,000 bopd ⁵ , inside the Firm’s 2023 steering vary of 32,000-34,000 bopd.

^{* F&D recycle ratio is outlined as fourth quarter 2022 working netback per WI gross sales quantity boe divided by the suitable F&D prices on a per boe foundation. Working netback doesn’t have a standardized which means beneath usually accepted accounting rules in america of America ( “GAAP” ) and is a non-GAAP measure. Working netback is outlined as oil gross sales much less working and transportation bills. See “Non-GAAP Measures” on this press launch.
** “Money circulate” refers to GAAP line merchandise “web money present by working actions”. Gran Tierra’s 2023 base case steering relies on a forecast 2023 common Brent oil value of $85/bbl.}

Future Web Income

Future web income displays McDaniel’s forecast of income estimated utilizing forecast costs and prices, arising from the anticipated growth and manufacturing of reserves, after the deduction of royalties, working prices, growth prices, abandonment and reclamation prices and taxes however earlier than consideration of oblique prices resembling administrative, overhead and different miscellaneous bills. The estimate of future web income beneath doesn’t essentially characterize honest market worth.

^{* The after-tax web current worth of the Firm’s oil and gasoline properties displays the tax burden on the properties on a stand-alone foundation. It doesn’t take into account the company tax state of affairs, or tax planning. It doesn’t present an estimate of the worth on the Firm stage which can be considerably completely different. The Firm’s monetary statements, when obtainable for the yr ended December 31, 2022, ought to be consulted for data on the Firm stage.}

Complete Firm WI Reserves

The next desk summarizes Gran Tierra’s NI 51-101 and COGEH compliant reserves in Colombia and Ecuador derived from the GTE McDaniel Reserves Report calculated utilizing forecast oil and gasoline costs and prices. Gran Tierra has decided that Ecuador reserves, included within the Complete Proved, Complete Possible and Complete Attainable reserve classes for Mild and Medium Crude Oil, aren’t materials sufficient to current individually on a rustic foundation. Due to this fact all quantities are offered on a consolidated foundation by international geographic space.

^{* Mbbl (thousand bbl of oil).
** MMcf (million cubic toes).
*** MBOE (thousand boe).}

Web Current Worth Abstract

Gran Tierra’s reserves had been evaluated utilizing McDaniel’s commodity value forecasts at January 1, 2023. It shouldn’t be assumed that the online current worth of money circulate estimated by McDaniel represents the honest market worth of the reserves.

Complete Firm WI Reserves Reconciliation

Reserve Life Index (Years)

^{* Calculated utilizing common fourth quarter 2022 WI manufacturing of 32,595 bopd.}

Future Growth Prices

FDC displays McDaniel’s greatest estimate of what it should price to carry the Proved Undeveloped and Possible reserves on manufacturing. Modifications in forecast FDC happen yearly on account of growth actions, acquisition and disposition actions, and adjustments in capital price estimates based mostly on enhancements in effectively design and efficiency, in addition to adjustments in service prices. FDC for 2P reserves elevated to $677 million at year-end 2022 from $578 million at year-end 2021. The rise in FDC in 2022 was predominantly attributed to the rise within the numbers of future growth effectively areas recognized by McDaniel within the Acordionero subject in addition to new areas recognized throughout exploration drilling.

Discovering and Growth Prices

^{*Working Netback is a Non-GAAP measure and doesn’t have a standardized which means beneath GAAP. Working netback as offered is outlined as oil gross sales much less working and transportation bills. See “Non-GAAP Measures” on this press launch.}

Discovering and Growth Prices, Excluding FDC *

Discovering and Growth Prices, Together with FDC *

Discovering and Growth Prices , Excluding FDC *

Discovering and Growth Prices , Together with FDC *

Discovering and Growth Prices , Excluding FDC *

Discovering and Growth Prices , Together with FDC *

Discovering and Growth Prices , Excluding FDC *

Discovering and Growth Prices , Together with FDC *

^{* In all instances, the F&D quantity is calculated by dividing the recognized capital expenditures by the relevant reserves additions each earlier than and after adjustments in FDC prices. Each F&D prices take into consideration reserves revisions throughout the yr on a per BOE foundation. F&D recycle ratio is outlined as fourth quarter 2022 working netback per working curiosity gross sales quantity BOE divided by the suitable F&D prices on a per BOE foundation. The combination of the exploration and growth prices incurred within the monetary yr and the adjustments throughout that yr in estimated future growth prices might not replicate the full F&D prices associated to reserves additions for that yr. Working Netback is a Non-GAAP measure and doesn’t have a standardized which means beneath GAAP. Working netback is outlined as oil gross sales much less working and transportation bills. See “Non-GAAP Measures” on this press launch.}

Forecast costs

The pricing assumptions utilized in estimating NI 51-101 and COGEH compliant reserves knowledge disclosed above with respect to web current values of future web income are set forth beneath. The worth forecasts are based mostly on McDaniel’s normal value forecast efficient January 1, 2023. McDaniel is an unbiased certified reserves evaluator and auditor pursuant to NI 51-101.

^{(1) Based mostly on estimated year-end 2022 web debt of $453 million comprised of Senior Notes of $580 million (gross) much less money and money equivalents of $127 million, ready in accordance with GAAP.
(2) Excellent Shares – Complete shares issued much less shares repurchased however not but cancelled.
(3) Web debt adjusted manufacturing is calculated by dividing (x) fourth quarter WI manufacturing by (y) the sum of (a) the year-end web debt by the closing value of the Firm’s widespread shares on the New York Inventory Trade at year-end and (b) the Firm’s excellent shares at year-end. Debt adjusted reserves is calculated by dividing (x) year-end reserves by (y) the sum of (a) the unaudited year-end web debt by the closing value of the Firm’s widespread shares on the New York Inventory Trade at year-end and (b) the Firm’s excellent shares at year-end.
For 2022, the Firm had unaudited year-end web debt of $453 million, a closing value on the New York Inventory Trade at December 31, 2022 of $0.99/share and 346,151,157 shares excellent. Fourth quarter WI manufacturing was 32,595 bopd, 1P reserves had been 83,697 MMBOE, 2P had been 130,127 MMBOE and 3P had been 182,652 MMBOE.
For 2021, the Firm had audited year-end web debt of $641 million (comprised of gross quantity of senior notes of $600 million, gross quantity of reserves-based credit score facility of $67.5 million and money of $26 million), a closing value on the New York Inventory Trade at December 31, 2021 of $0.76/share and 367,144,500 shares excellent. Fourth quarter WI manufacturing was 29,493 bopd, 1P reserves had been 80,816 MMBOE, 2P had been 124,692 MMBOE, and 3P had been 162,485 MMBOE.
(4) Web debt adjusted manufacturing and reserves per share are non-GAAP monetary ratios that aren’t a standardized monetary measure beneath US GAAP and is probably not similar to comparable monetary measures disclosed by different issuers. Web debt, outlined above, is a non-GAAP monetary ratio, is used as a part of this non-GAAP monetary ratio. See “Non-GAAP and Different Monetary Measures” on this information launch for data regarding this non-GAAP monetary measure.
(5) Gran Tierra’s first quarter-to-date 2023 complete Firm common manufacturing is for the interval of January 1 – January 24, 2023.}

Company Presentation:

Gran Tierra’s Company Presentation has been up to date and is out there on the Firm web site at www.grantierra.com.

Contact Info

For investor and media inquiries please contact:

Gary Guidry, Chief Govt Officer

Ryan Ellson, Govt Vice President & Chief Monetary Officer

Rodger Trimble, Vice President, Investor Relations
Tel: +1.403.265.3221

For extra data on Gran Tierra please go to: www.grantierra.com.

About Gran Tierra Vitality Inc.

Gran Tierra Vitality Inc. along with its subsidiaries is an unbiased worldwide power firm at present targeted on oil and pure gasoline exploration and manufacturing in Colombia and Ecuador. The Firm is at present growing its present portfolio of property in Colombia and Ecuador and can proceed to pursue further development alternatives that will additional strengthen the Firm’s portfolio. The Firm’s widespread inventory trades on the NYSE American, the Toronto Inventory Trade and the London Inventory Trade beneath the ticker image GTE. Further data regarding Gran Tierra is out there at www.grantierra.com. Info on the Firm’s web site (together with the Company Presentation referenced above) doesn’t represent part of this press launch. Investor inquiries could also be directed to information@grantierra.com or (403) 265-3221.

Gran Tierra’s U.S. Securities and Trade Fee (“SEC”) filings can be found on the SEC web site at www.sec.gov. The Firm’s Canadian securities regulatory filings can be found on SEDAR at www.sedar.com and UK regulatory filings can be found on the Nationwide Storage Mechanism (“the NSM”) web site at https://knowledge.fca.org.uk/#/nsm/nationalstoragemechanism. Gran Tierra’s filings on the SEC, SEDAR and the NSM web sites aren’t integrated by reference into this press launch.

FORWARD LOOKING STATEMENTS ADVISORY

This press launch comprises opinions, forecasts, projections, and different statements about future occasions or outcomes that represent forward-looking statements inside the which means of america Personal Securities Litigation Reform Act of 1995, Part 27A of the Securities Act of 1933, as amended, and Part 21E of the Securities Trade Act of 1934, as amended, and monetary outlook and ahead wanting data inside the which means of relevant Canadian securities legal guidelines (collectively, “forward-looking statements”), which will be recognized by such phrases as “count on,” “plan,” “forecast,” “undertaking,” “goal,” “will,” “consider,” “ought to,” “may,” “permit” and different phrases which might be forward-looking in nature. Such forward-looking statements embody, however aren’t restricted to, the Firm’s expectations relating to its capital program, and skill to fund the Firm’s exploration program over a time period, 2022 and past outlook, the advantages of lowered capital spending and G&A bills, effectively efficiency, manufacturing, the restart of manufacturing and workover exercise, future growth prices, infrastructure schedules, waterflood impacts and plans, development of referenced reserves, forecast costs, five-year anticipated oil gross sales and money circulate and web income, estimated restoration elements, liquidity and entry to capital, the Firm’s methods and outcomes thereof, the Firm’s operations together with deliberate operations and developments, the impression of the COVID-19 pandemic and the Firm’s response thereto, disruptions to operations and the decline in trade circumstances, and expectations relating to environmental commitments.

The forward-looking statements contained on this press launch replicate a number of materials elements and expectations and assumptions of Gran Tierra together with, with out limitation, that Gran Tierra will proceed to conduct its operations in a fashion in line with its present expectations, the accuracy of testing and manufacturing outcomes and seismic knowledge, pricing and value estimates (together with with respect to commodity pricing and change charges), rig availability, the results of drilling down-dip, the results of waterflood and multi-stage fracture stimulation operations, the extent and impact of supply disruptions, and the overall continuance of present or, the place relevant, assumed operational, regulatory and trade circumstances together with in areas of potential enlargement, and the power of Gran Tierra to execute its present enterprise and operational plans within the method at present deliberate. Gran Tierra believes the fabric elements, expectations and assumptions mirrored within the forward-looking statements are affordable right now however no assurance will be provided that these elements, expectations and assumptions will show to be right.

Among the many essential elements that might trigger precise outcomes to vary materially from these indicated by the forward-looking statements on this press launch are: Gran Tierra’s operations are situated in South America and surprising issues can come up as a result of guerilla exercise, strikes, or native blockades or protests; technical difficulties and operational difficulties might come up which impression the manufacturing, transport or sale of our merchandise; different disruptions to native operations; international well being occasions (together with the continuing COVID-19 pandemic); international and regional adjustments within the demand, provide, costs, differentials or different market circumstances affecting oil and gasoline, together with inflation and adjustments ensuing from a worldwide well being disaster, the Russian invasion of Ukraine, or from the imposition or lifting of crude oil manufacturing quotas or different actions that is perhaps imposed by OPEC and different producing nations and the ensuing firm or third-party actions in response to such adjustments; adjustments in commodity costs, together with volatility or a protracted decline in these costs relative to historic or future anticipated ranges; the chance that present international financial and credit score circumstances might impression oil costs and oil consumption greater than Gran Tierra at present predicts, which may trigger Gran Tierra to additional modify its technique and capital spending program; costs and markets for oil and pure gasoline are unpredictable and risky; the impact of hedges, the accuracy of productive capability of any explicit subject; geographic, political and climate circumstances can impression the manufacturing, transport or sale of our merchandise; the power of Gran Tierra to execute its marketing strategy and understand anticipated advantages from present initiatives; the chance that surprising delays and difficulties in growing at present owned properties might happen; the power to interchange reserves and manufacturing and develop and handle reserves on an economically viable foundation; the accuracy of testing and manufacturing outcomes and seismic knowledge, pricing and value estimates (together with with respect to commodity pricing and change charges); the chance profile of deliberate exploration actions; the results of drilling down-dip; the results of waterflood and multi-stage fracture stimulation operations; the extent and impact of supply disruptions, gear efficiency and prices; actions by third events; the well timed receipt of regulatory or different required approvals for our working actions; the failure of exploratory drilling to lead to business wells; surprising delays as a result of restricted availability of drilling gear and personnel; volatility or declines within the buying and selling value of our widespread inventory or bonds; the chance that Gran Tierra doesn’t obtain the anticipated advantages of presidency packages, together with authorities tax refunds; Gran Tierra’s potential to adjust to monetary covenants in its credit score settlement and indentures and make borrowings beneath its credit score settlement; and the chance elements detailed every so often in Gran Tierra’s periodic reviews filed with the Securities and Trade Fee, together with, with out limitation, beneath the caption “Danger Elements” in Gran Tierra’s Annual Report on Type 10-Okay for the yr ended December 31, 2021 and its different filings with the Securities and Trade Fee. These filings can be found on the Securities and Trade Fee web site at https://www.sec.gov and on SEDAR at www.sedar.com.

Statements regarding “reserves” are additionally deemed to be forward-looking statements, as they contain the implied evaluation, based mostly on sure estimates and assumptions, together with that the reserves described will be profitably produced sooner or later.

Steering is unsure, significantly when given over prolonged intervals of time, and outcomes could also be materially completely different. Though the present capital spending program and long run technique of Gran Tierra relies upon the present expectations of the administration of Gran Tierra, ought to any one in all a variety of points come up, Gran Tierra might discover it needed to change its enterprise technique and/or capital spending program and there will be no assurance as on the date of this press launch as to how these funds could also be reallocated or technique modified and the way that will impression Gran Tierra’s outcomes of operations and financing place. Particularly, the unprecedented nature of the present pandemic and the ensuing financial circumstances might make it significantly troublesome to determine dangers or predict the diploma to which recognized dangers will impression Gran Tierra’s enterprise and monetary situation. All forward-looking statements are made as of the date of this press launch and the truth that this press launch stays obtainable doesn’t represent a illustration by Gran Tierra that Gran Tierra believes these forward-looking statements proceed to be true as of any subsequent date. Precise outcomes might fluctuate materially from the anticipated outcomes expressed in forward-looking statements. Gran Tierra disclaims any intention or obligation to replace or revise any forward-looking statements, whether or not on account of new data, future occasions or in any other case, besides as expressly required by relevant securities legal guidelines. Gran Tierra’s forward-looking statements are expressly certified of their entirety by this cautionary assertion.

The estimates of future web income, money circulate and curiosity and sure bills could also be thought-about to be future-oriented monetary data or a monetary outlook for the needs of relevant Canadian securities legal guidelines. Monetary outlook and future oriented monetary data contained on this press launch about potential monetary efficiency, monetary place or money flows are offered to offer the reader a greater understanding of the potential future efficiency of the Firm in sure areas and are based mostly on assumptions about future occasions, together with financial circumstances and proposed programs of motion, based mostly on administration’s evaluation of the related data at present obtainable, and to develop into obtainable sooner or later. Particularly, this press launch comprises projected operational and monetary data for 2023 and for the following 5 years to permit readers to evaluate the Firm’s potential to fund its packages. These projections comprise forward-looking statements and are based mostly on a variety of materials assumptions and elements set out above. Precise outcomes might differ considerably from the projections offered herein. The precise outcomes of Gran Tierra’s operations for any interval may fluctuate from the quantities set forth in these projections, and such variations could also be materials. See above for a dialogue of the dangers that might trigger precise outcomes to fluctuate. The long run-oriented monetary data and monetary outlooks contained on this press launch have been authorised by administration as of the date of this press launch. Readers are cautioned that any such monetary outlook and future-oriented monetary data contained herein shouldn’t be used for functions apart from these for which it’s disclosed herein. The Firm and its administration consider that the potential monetary data has been ready on an inexpensive foundation, reflecting administration’s greatest estimates and judgments, and characterize, to the most effective of administration’s data and opinion, the Firm’s anticipated plan of action. Nevertheless, as a result of this data is extremely subjective, it shouldn’t be relied on as essentially indicative of future outcomes.

Non-GAAP Measures

This press launch contains non-GAAP measures which shouldn’t have a standardized which means beneath GAAP. Buyers are cautioned that these measures shouldn’t be construed as options to web loss or different measures of monetary efficiency as decided in accordance with GAAP. Gran Tierra’s technique of calculating these measures might differ from different firms and, accordingly, they is probably not similar to comparable measures utilized by different firms.

Working netback as offered is outlined as oil gross sales much less working and transportation bills. Administration believes that working netback is a helpful supplemental measure for buyers to research monetary efficiency and supply a sign of the outcomes generated by Gran Tierra’s principal enterprise actions previous to the consideration of different revenue and bills. A reconciliation working netback per boe to probably the most straight comparable measure calculated and offered in accordance with GAAP is as follows:

Unaudited Monetary Info

Sure monetary and working outcomes included on this press launch, together with debt, capital expenditures, and manufacturing data, are based mostly on unaudited estimated outcomes. These estimated outcomes are topic to vary upon completion of the Firm’s audited monetary statements for the yr ended December 31, 2022, and adjustments could possibly be materials. Gran Tierra anticipates submitting its audited monetary statements and associated administration’s dialogue and evaluation for the yr ended December 31, 2022 on or earlier than February 21, 2023.

DISCLOSURE OF OIL AND GAS INFORMATION

Gran Tierra’s Assertion of Reserves Information and Different Oil and Gasoline Info on Type 51-101F1 dated efficient as at December 31, 2022, which can embody additional disclosure of its oil and gasoline reserves and different oil and gasoline data in accordance with NI 51-101 forming the idea of this press launch, can be obtainable on SEDAR at www.sedar.com on or earlier than February 21, 2023.

All reserves values, future web income and ancillary data contained on this press launch as of December 31, 2022 are derived from a report with an efficient date of December 31, 2022 ready by McDaniel and calculated in compliance with NI 51-101 and COGEH.

Estimates of web current worth and future web income contained herein don’t essentially characterize honest market worth. Estimates of reserves and future web income for particular person properties might not replicate the identical stage of confidence as estimates of reserves and future web income for all properties, as a result of impact of aggregation. There isn’t any assurance that the forecast value and value assumptions utilized by McDaniel in evaluating Gran Tierra’s reserves can be attained and variances could possibly be materials. All reserves assigned within the GTE McDaniel Reserves Report are situated in Colombia and Ecuador and offered on a consolidated foundation by international geographic space.

All evaluations of future web income contained within the GTE McDaniel Reserves Report are after the deduction of royalties, working prices, growth prices, manufacturing prices and abandonment and reclamation prices however earlier than consideration of oblique prices resembling administrative, overhead and different miscellaneous bills. It shouldn’t be assumed that the estimates of future web revenues offered on this press launch characterize the honest market worth of the reserves. There are quite a few uncertainties inherent in estimating portions of crude oil reserves and the long run money flows attributed to such reserves. The reserve and related money circulate data set forth within the GTE McDaniel Reserves Report are estimates solely.

References to a formation the place proof of hydrocarbons has been encountered isn’t essentially an indicator that hydrocarbons can be recoverable in business portions or in any estimated quantity. Gran Tierra’s reported manufacturing is a mixture of gentle crude oil and medium and heavy crude oil for which there isn’t a exact breakdown because the Firm’s oil gross sales volumes usually characterize blends of a couple of sort of crude oil. Drilling areas disclosed herein are derived from the GTE McDaniel Reserves Report and account for drilling areas which have related Undeveloped and Proved plus Possible Undeveloped reserves, as relevant. Properly check outcomes ought to be thought-about as preliminary and never essentially indicative of long-term efficiency or of final restoration. Properly log interpretations indicating oil and gasoline accumulations aren’t essentially indicative of future manufacturing or final restoration. Whether it is indicated {that a} strain transient evaluation or well-test interpretation has not been carried out, any knowledge disclosed in that respect ought to be thought-about preliminary till such evaluation has been accomplished. References to thickness of “oil pay” or of a formation the place proof of hydrocarbons has been encountered isn’t essentially an indicator that hydrocarbons can be recoverable in business portions or in any estimated quantity.

Definitions

Proved reserves are these reserves that may be estimated with a excessive diploma of certainty to be recoverable. It’s seemingly that the precise remaining portions recovered will exceed the estimated proved reserves.

Possible reserves are these further reserves which might be much less sure to be recovered than proved reserves. It’s equally seemingly that the precise remaining portions recovered can be better or lower than the sum of the estimated proved plus possible reserves.

Attainable reserves are these further reserves which might be much less sure to be recovered than Possible reserves. There’s a 10% likelihood that the portions truly recovered will equal or exceed the sum of Proved plus Possible plus Attainable reserves.

Proved developed producing reserves are these reserves which might be anticipated to be recovered from completion intervals open on the time of the estimate. These reserves could also be at present producing or, if shut-in, they should have beforehand been on manufacturing, and the date of resumption of manufacturing should be recognized with affordable certainty.

Undeveloped reserves are these reserves anticipated to be recovered from recognized accumulations the place a major expenditure (e.g., when in comparison with the price of drilling a effectively) is required to render them able to manufacturing. They need to absolutely meet the necessities of the reserves class (proved, possible, attainable) to which they’re assigned.

Sure phrases used on this press launch however not outlined are outlined in NI 51-101, CSA Employees Discover 51-324 – Revised Glossary to NI 51-101, Requirements of Disclosure for Oil and Gasoline Actions (” CSA Employees Discover 51-324 “) and/or the COGEH and, until the context in any other case requires, shall have the identical meanings herein as in NI 51-101, CSA Employees Discover 51-324 and the COGEH, because the case could also be.

Oil and Gasoline Metrics

This press launch comprises a variety of oil and gasoline metrics, together with NAV per share, F&D prices, F&D recycle ratio, working netback, reserve life index, and reserves substitute, reserves per share and debt-adjusted manufacturing and reserves per share, which shouldn’t have standardized meanings or normal strategies of calculation and subsequently such measures is probably not similar to comparable measures utilized by different firms and shouldn’t be used to make comparisons. Such metrics have been included herein to offer readers with further measures to judge the Firm’s efficiency; nonetheless, such measures aren’t dependable indicators of the long run efficiency of the Firm and future efficiency might not examine to the efficiency in earlier intervals.

• NAV per share is calculated as NPV10 (earlier than or after tax, as relevant) of the relevant reserves class minus estimated debt, divided by the variety of shares of Gran Tierra’s widespread inventory issued and excellent. Administration makes use of NAV per share as a measure of the relative change of Gran Tierra’s web asset worth over its excellent widespread inventory over a time period.
• F&D prices are calculated as estimated exploration and growth capital expenditures, excluding acquisitions and tendencies, divided by the relevant reserves additions each earlier than and after adjustments in FDC prices. The calculation of F&D prices incorporates the change in FDC required to carry proved undeveloped and developed reserves into manufacturing. The combination of the exploration and growth prices incurred within the monetary yr and the adjustments throughout that yr in estimated FDC might not replicate the full F&D prices associated to reserves additions for that yr. Administration makes use of F&D prices per boe as a measure of its potential to execute its capital program and of its asset high quality.
• F&D recycle ratio is calculated as fourth quarter working netback per WI gross sales quantity divided by the suitable F&D prices per boe. Administration makes use of F&D recycle ratio as an indicator of profitability of its oil and gasoline actions.
• Working netback is calculated as described on this press launch. Administration believes that working netback is a helpful supplemental measure for buyers to research monetary efficiency and supply a sign of the outcomes generated by Gran Tierra’s principal enterprise actions previous to the consideration of different revenue and bills.
• Reserve life index is calculated as reserves within the referenced class divided by the referenced estimated manufacturing. Administration makes use of this measure to find out how lengthy the booked reserves will final at present manufacturing charges if no additional reserves had been added.
• Reserves substitute is calculated as reserves within the referenced class divided by estimated referenced manufacturing. Administration makes use of this measure to find out the relative change of its reserve base over a time period.
• Reserves per share is calculated as reserves within the referenced class divided by the variety of shares of Gran Tierra’s widespread inventory issued and excellent. Administration makes use of reserves per share as a measure of relative change of Gran Tierra’s referenced reserves class over its excellent widespread inventory over a time period.
• Web debt-adjusted manufacturing and reserves per share is calculated as described on this press launch. Administration believes that web debt-adjusted manufacturing per share is a helpful supplemental measure for buyers because it adjusts for the results of adjustments in annual manufacturing in relation to the Firm’s capital construction. Administration believes that web debt-adjusted reserves per share is a helpful supplemental measures for buyers because it adjusts for the results of adjustments in reserves in relation to the Firm’s capital construction.

Disclosure of Reserve Info and Cautionary Observe to U.S. Buyers

Until expressly acknowledged in any other case, all estimates of proved, possible and attainable reserves and associated future web income disclosed on this press launch have been ready in accordance with NI 51-101. Estimates of reserves and future web income made in accordance with NI 51-101 will differ from corresponding estimates ready in accordance with relevant U.S. Securities and Trade Fee (“SEC”) guidelines and disclosure necessities of the U.S. Monetary Accounting Requirements Board (“FASB”), and people variations could also be materials. NI 51-101, for instance, requires disclosure of reserves and associated future web income estimates based mostly on forecast costs and prices, whereas SEC and FASB requirements require that reserves and associated future web income be estimated utilizing common costs for the earlier 12 months. As well as, NI 51-101 permits the presentation of reserves estimates on a “firm gross” foundation, representing Gran Tierra’s working curiosity share earlier than deduction of royalties, whereas SEC and FASB requirements require the presentation of web reserve estimates after the deduction of royalties and comparable funds. There are additionally variations within the technical reserves estimation requirements relevant beneath NI 51-101 and, pursuant thereto, the COGEH, and people relevant beneath SEC and FASB necessities.

Along with being a reporting issuer in sure Canadian jurisdictions, Gran Tierra is a registrant with the SEC and topic to home issuer reporting necessities beneath U.S. federal securities legislation, together with with respect to the disclosure of reserves and different oil and gasoline data in accordance with U.S. federal securities legislation and relevant SEC guidelines and laws (collectively, “SEC necessities”). Disclosure of such data in accordance with SEC necessities is included within the Firm’s Annual Report on Type 10-Okay and in different reviews and supplies filed with or furnished to the SEC and, as relevant, Canadian securities regulatory authorities. The SEC permits oil and gasoline firms which might be topic to home issuer reporting necessities beneath U.S. federal securities legislation, of their filings with the SEC, to reveal solely estimated proved, possible and attainable reserves that meet the SEC’s definitions of such phrases. Gran Tierra has disclosed estimated proved, possible and attainable reserves in its filings with the SEC. As well as, Gran Tierra prepares its monetary statements in accordance with United States usually accepted accounting rules, which require that the notes to its annual monetary statements embody supplementary disclosure in respect of the Firm’s oil and gasoline actions, together with estimates of its proved oil and gasoline reserves and a standardized measure of discounted future web money flows regarding proved oil and gasoline reserve portions. This supplementary monetary assertion disclosure is offered in accordance with FASB necessities, which align with corresponding SEC necessities regarding reserves estimation and reporting.

Proved reserves are reserves which, by evaluation of geoscience and engineering knowledge, will be estimated with affordable certainty to be economically producible from a given date ahead from recognized reservoirs beneath present financial circumstances, working strategies, and authorities laws previous to the time at which contracts offering the precise to function expires, until proof signifies that renewal in all fairness sure. Possible reserves are reserves which might be much less sure to be recovered than proved reserves however which, along with proved reserves, are as seemingly as to not be recovered. Estimates of possible reserves which can probably be recoverable via further drilling or restoration methods are by nature extra unsure than estimates of proved reserves and accordingly are topic to considerably better danger of not truly being realized by us. Attainable reserves are reserves which might be much less sure to be recovered than possible reserves. Estimates of attainable reserves are additionally inherently imprecise. Estimates of possible and attainable reserves are additionally frequently topic to revisions based mostly on manufacturing historical past, outcomes of further exploration and growth, value adjustments, and different elements.

The Firm believes that the presentation of NPV10 is helpful to buyers as a result of it presents (i) relative financial significance of its oil and pure gasoline properties no matter tax construction and (ii) relative dimension and worth of its reserves to different firms. The Firm additionally makes use of this measure when assessing the potential return on funding associated to its oil and pure gasoline properties. NPV10 and the standardized measure of discounted future web money flows don’t purport to current the honest worth of the Firm’s oil and gasoline reserves. The Firm has not offered a reconciliation of NPV10 to the standardized measure of discounted future web money flows as a result of it’s impracticable to take action.

Buyers are urged to contemplate carefully the disclosures and danger elements within the Firm’s Annual Report on Type 10-Okay, Quarterly Reviews on Type 10-Q and within the different reviews and filings with the SEC, obtainable from the Firm’s workplaces or web site. These reviews may also be obtained from the SEC web site at www.sec.gov.