GeoPark Announces Second Quarter 2024 Operational Update

Rhea-AI Summary

GeoPark (NYSE: GPRK) announced its operational update for Q2 2024, reporting a new quarterly production record in CPO-5 and consolidated pro forma production over 41,000 boepd as of July 1, 2024. Key highlights include:

- Q2 2024 consolidated average production of 35,608 boepd, slightly up from Q1 2024
- 11% production increase in Ecuador and 3% in Colombia
- Record average production of 7,921 boepd net in CPO-5 Block
- Llanos 34 Block average production of 23,039 bopd net
- Successful drilling activities across multiple blocks
- Addition of approximately 5,700 boepd from Mata Mora Norte Block in Argentina

The company continues to focus on exploration and development activities across its portfolio, with 11 rigs currently in operation and plans to drill 8-10 gross wells in Q3 2024 for the base business and 6-8 gross wells in Argentina.

Positive

• New quarterly production record in CPO-5 Block with 7,921 boepd net
• Consolidated pro forma production increased to over 41,000 boepd as of July 1, 2024
• 11% production increase in Ecuador and 3% in Colombia compared to Q1 2024
• Addition of approximately 5,700 boepd from Mata Mora Norte Block in Argentina
• Successful drilling activities and exploration across multiple blocks

Negative

• 3% lower production in Llanos 34 Block compared to Q1 2024 due to sporadic blockades and weather-associated flooding
• Suspended production at Manati gas field in Brazil due to unscheduled maintenance
• Overall 3% decrease in total production compared to Q2 2023

Insights

Financial Analyst

The recent operational update from GeoPark Limited suggests a robust growth trajectory, especially highlighted by the record production figures. The company's consolidated average oil and gas production for 2Q2024 stands at 35,608 boepd, up slightly from the previous quarter. Notably, the announcement mentions a significant leap to over 41,000 boepd as of July 1, 2024, attributed to added production from the Mata Mora Norte Block in Argentina.

GeoPark's strategy of leveraging its diverse asset portfolio across multiple Latin American countries is paying off. The significant production increase in Ecuador and steady operations in Colombia indicate operational resilience and effective risk mitigation. The upcoming catalysts include various exploratory and development drilling projects, which, if successful, will further bolster the company’s production capacity.

For retail investors, the immediate outlook appears promising. The proforma production increase and strategic drilling campaigns hint at potential upward momentum for the stock. However, considerations like the geopolitical climate in Latin America and the broader oil market trends need to be factored in for long-term investment decisions.

Market Research Analyst

GeoPark Limited's emphasis on new drilling and exploration activities is noteworthy. Their active management of 11 rigs, including operations in Argentina's key blocks, reflects a strategic pivot towards maximizing resource extraction. The company's focus on horizontal drilling and secondary recovery projects in the Llanos 34 Block also demonstrates a commitment to enhancing production efficiency and yield.

Retail investors should monitor the progress of these projects closely. The success of the exploratory wells, particularly in new formations like the Barco and Guadalupe, could unlock additional resources and drive significant future growth. Additionally, GeoPark's expanding seismic coverage and data acquisition will likely improve their drilling accuracy and effectiveness, potentially leading to more economically viable wells.

However, investors should remain cautious about the inherent risks associated with exploration activities, including potential delays and cost overruns. The proactive approach towards exploration and production is positive, but it requires careful execution to translate into sustained financial performance.

Tech Expert

GeoPark's integration of advanced drilling techniques, especially horizontal and unconventional drilling, is central to their operational success. The company's adoption of new technologies in waterflooding projects, which are already performing above plan, is a testament to their innovative approach in maximizing oil recovery. The technology-driven efficiencies not only enhance output but also optimize resource utilization.

For retail investors, GeoPark's technological advancements signify a forward-thinking company that is not resting on traditional methods. The deployment of sophisticated seismic data acquisition and processing techniques further supports their exploration and drilling strategies, potentially reducing the risk of dry wells and increasing the probability of finding economically viable hydrocarbon reserves.

The continuous improvement in drilling technology and practices provides a competitive edge, positioning GeoPark favorably within the oil and gas sector. While technology adoption involves initial costs, the long-term benefits of increased production efficiency and reduced operational risks are likely to outweigh these expenditures.

New Quarterly Production Record in CPO-5

Consolidated Pro Forma Production Over 41,000 boepd as of July 1, 2024

BOGOTA, Colombia--(BUSINESS WIRE)-- GeoPark Limited (“GeoPark” or the “Company”) (NYSE: GPRK), a leading independent Latin American oil and gas explorer, operator and consolidator, today announces its operational update for the three-month period ended June 30, 2024 (“2Q2024”).

Oil and Gas Production and Operations

• 2Q2024 consolidated average oil and gas production of 35,608 boepd, up slightly versus 1Q2024
• Production increased 11% in Ecuador and 3% in Colombia, offsetting suspended production at the Manati gas field in Brazil (GeoPark non-operated, 10% WI) due to unscheduled maintenance
• As of July 1, 2024,¹ GeoPark is producing over 41,000 boepd, adding approximately 5,700 boepd on a proforma basis from the Mata Mora Norte Block (GeoPark non-operated, 45% WI) in Argentina
• 11 rigs currently in operation (7 drilling rigs and 4 workover rigs), including one drilling rig in Argentina

Llanos 34 Block (GeoPark operated, 45% WI): Secondary Recovery Underway

• 2Q2024 average production of 23,039 bopd net (51,198 boepd gross), 3% lower than 1Q2024 due to sporadic blockades and weather-associated flooding
• Three horizontal wells were drilled in 2Q2024, including the first two in the Jacana field which initiated testing in April and June 2024, respectively
• Eight horizontal wells in aggregate have been put on production since the beginning of the horizontal well drilling program in early 2023, currently contributing 16% of total production in the block
• Waterflooding projects performing above plan, delivering around 3,700 bopd in 2Q2024, 13% of total production in the block

CPO-5 Block (GeoPark non-operated, 30% WI): Record High Quarterly Production

• 2Q2024 record average production of 7,921 boepd net (26,403 boepd gross) after putting the Indico-3 development well on production
• The Lark 1 exploration well in the northern part of the block reached total depth in July 2024 and will delineate hydrocarbon potential in the Ubaque and the Guadalupe Formations, initiating testing by the end of July
• Increased seismic coverage to 85% after completing the acquisition of 232 sq. km of 3D seismic,² currently being processed

Llanos Exploration: Drilling Success Continues

• Llanos 123 Block (GeoPark operated, 50% WI):
  • Drilled the Toritos Norte 1 appraisal well during June 2024, testing the Barco Formation and currently producing 520 bopd gross
  • The Toritos 2 appraisal well reached total depth in July 2024, and will initiate testing in the Barco Formation in August 2024
• Llanos 86 and Llanos 104 Blocks (GeoPark operated, 50% WI):
  • Processing 650+ sq. km of 3D seismic, targeting exploration drilling in 1Q2025

Ecuador: Stepping up Production and Exploration

• Perico Block (GeoPark non-operated, 50% WI):
  • Production increased 11% compared to 1Q2024, reaching 1,652 bopd net during the quarter due to the contribution from the Perico Centro 2 appraisal well in May 2024
• Espejo Block (GeoPark operated, 50% WI):
  • Drilled the Espejo Sur 3 exploration well in June 2024, testing the U-Sand Formation, currently producing 400 bopd gross

Argentina: Vaca Muerta Adds Pro forma Production

• 2Q2024 average production of 12,508 bopd gross from the Mata Mora Norte Block
• Encouraging initial results of Mata Mora Norte 2223 well, producing an average of 2,136 boepd gross during 2Q2024, in line with the best producing well in the block
• Transaction effective date July 1, 2024. Regulatory closing of acquisition is expected by end of 3Q2024

Upcoming Catalysts 3Q2024

• Drilling 8-10 gross wells in 3Q2024 for the base business and 6-8 gross wells in Argentina, targeting conventional, unconventional, short-cycle development, injector, appraisal and exploration projects
• Key projects include:
  • Llanos 34 Block: Drilling the first well with short radius design, the first horizontal well targeting the Guadalupe Formation and two additional waterflooding injection patterns
  • CPO-5 Block: Drilling one appraisal well
  • Llanos 123 Block: Drilling one appraisal well
  • Perico Block: Executing workover campaign
  • Espejo Block: Drilling one exploratory well
  • Mata Mora Norte Block: Drilling four unconventional horizontal wells
  • Confluencia Norte Block (GeoPark non-operated, 50% WI): Drilling three unconventional exploration wells

Breakdown of Quarterly Production by Country

The following table shows production figures for 2Q2024, as compared to 2Q2023:

	2Q2024				2Q2023
	Total (boepd)	Oil (bopd)a	Gas (mcfpd)		Total (boepd)	% Change
Colombia	33,956	33,852	623		33,045	3	%
Ecuador	1,652	1,652	-		634	161	%
Brazil	-	-	-		1,212	-100	%
Chileb	-	-	-		1,690	-100	%
Total	35,608	35,504	623		36,581	-3	%

a)		Includes royalties and other economic rights paid in kind in Colombia for approximately 6,956 bopd in 2Q2024. No royalties were paid in kind in Ecuador, Chile or Brazil. Production in Ecuador is reported before the Government’s production share of approximately 512 bopd
b)		Closing of the divestment transaction in January 2024

Quarterly Production

(boepd)	2Q2024	1Q2024	4Q2023	3Q2023	2Q2023
Colombia	33,956	32,832	34,154	31,780	33,045
Ecuador	1,652	1,483	1,419	659	634
Brazil	-	893	1,101	774	1,212
Chilea	-	264	1,41	1,565	1,690
Totalb	35,608	35,473	38,315	34,778	36,581
Oil	35,504	34,255	35,842	32,510	33,672
Gas	104	1,218	2,473	2,268	2,909

a)		Closing of the divestment transaction in January 2024
b)		In Colombia, production includes royalties paid in kind, and in Ecuador it is shown before the Government’s production share

Reporting Date for 2Q2024 Results Release, Conference Call and Webcast

GeoPark will report its 2Q2024 financial results on Wednesday, August 14, 2024, after the market close.

GeoPark management will host a conference call on August 15, 2024, at 10:00 am (Eastern Daylight Time) to discuss the 2Q2024 financial results.

To listen to the call, participants can access the webcast located in the Invest with Us section of the Company’s website at www.geo-park.com, or by clicking below:

https://events.q4inc.com/attendee/332625400

Interested parties may participate in the conference call by dialing the numbers provided below:

United States Participants: +1 404-975-4839
Global Dial-In Numbers:
https://www.netroadshow.com/conferencing/global-numbers?confId=68476
Passcode: 027838

Please allow extra time prior to the call to visit the website and download any streaming media software that might be required to listen to the webcast.

An archive of the webcast replay will be made available in the Invest with Us section of the Company’s website at www.geo-park.com after the conclusion of the live call.

NOTICE

Additional information about GeoPark can be found in the “Invest with Us” section on the website at www.geo-park.com.

Rounding amounts and percentages: Certain amounts and percentages included in this press release have been rounded for ease of presentation. Percentages included in this press release have not in all cases been calculated on the basis of such rounded amounts, but on the basis of such amounts prior to rounding. For this reason, certain percentages in this press release may vary from those obtained by performing the same calculations on the basis of the amounts in the financial statements. Similarly, certain other amounts included in this press release may not sum due to rounding.

CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION

This press release contains statements that constitute forward-looking statements. Many of the forward-looking statements contained in this press release can be identified by the use of forward-looking words such as ‘‘anticipate,’’ ‘‘believe,’’ ‘‘could,’’ ‘‘expect,’’ ‘‘should,’’ ‘‘plan,’’ ‘‘intend,’’ ‘‘will,’’ ‘‘estimate’’ and ‘‘potential,’’ among others.

Forward-looking statements that appear in a number of places in this press release include, but are not limited to, statements regarding the intent, belief or current expectations, regarding various matters, including, drilling campaign, production guidance and capital expenditures. Forward-looking statements are based on management’s beliefs and assumptions, and on information currently available to the management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors.

Forward-looking statements speak only as of the date they are made, and the Company does not undertake any obligation to update them in light of new information or future developments or to release publicly any revisions to these statements in order to reflect later events or circumstances, or to reflect the occurrence of unanticipated events. For a discussion of the risks facing the Company which could affect whether these forward-looking statements are realized, see filings with the U.S. Securities and Exchange Commission (SEC).

Oil and gas production figures included in this release are stated before the effect of royalties paid in kind, consumption and losses. Annual production per day is obtained by dividing total production by 365 days.

¹ Vaca Muerta transaction effective date.
² Seismic area represented as full fold.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240721565564/en/

For further information, please contact:

INVESTORS:

Stacy Steimel ssteimel@geo-park.com

Shareholder Value Director

T: +562 2242 9600

Miguel Bello mbello@geo-park.com

Market Access Director

T: +562 2242 9600

Diego Gully dgully@geo-park.com

Capital Markets Director

T: +55 21 99636 9658

MEDIA:

Communications Department communications@geo-park.com

Source: GeoPark Limited

FAQ

What was GeoPark's (GPRK) consolidated average production in Q2 2024?

GeoPark's consolidated average oil and gas production for Q2 2024 was 35,608 boepd, slightly higher than Q1 2024.

How much did GeoPark's (GPRK) production increase in Ecuador during Q2 2024?

GeoPark's production in Ecuador increased by 11% compared to Q1 2024, reaching 1,652 bopd net during the quarter.

What was the average production in the Llanos 34 Block for GeoPark (GPRK) in Q2 2024?

The average production in the Llanos 34 Block for Q2 2024 was 23,039 bopd net (51,198 boepd gross), which was 3% lower than Q1 2024.

How many rigs does GeoPark (GPRK) currently have in operation as of Q2 2024?

GeoPark currently has 11 rigs in operation, including 7 drilling rigs and 4 workover rigs, with one drilling rig in Argentina.

What is GeoPark's (GPRK) pro forma production as of July 1, 2024?

As of July 1, 2024, GeoPark's pro forma production is over 41,000 boepd, including approximately 5,700 boepd from the Mata Mora Norte Block in Argentina.