Q2 2025 Gran Tierra Energy Inc Earnings Call

Operator: Hi, my name is Michelle, and I will be your coordinator for today. At this time, all participants are in a listen-only mode. Following the initial remarks, we will conduct a question and answer session for securities analysts and institutions. Instructions will be provided at that time for you to queue up for questions. I would like to remind everyone that this conference is being webcast and recorded today, Thursday, 31 July 2025, at 11:00 AM Eastern Time. Today's discussion may include certain forward-looking information, oil and gas information, and non-GAAP financial measures. Please refer to the earnings and operational update press release we issued yesterday for important advisories and disclaimers with regard to this information and reconciliations of any non-GAAP measures discussed on today's call. Finally, this earnings call is the property of Gran Tierra Energy Inc.

For today at this time all participants are in a listen only mode. Following the initial remarks, we will conduct a question and answer session for securities analysts and institutions instructions will be provided at that time for you to queue up for questions I would like to remind everyone.

One that this conference is being webcast and recorded today Thursday July 31, 2025 at 11, a M eastern time.

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

Conciliations of any non-GAAP measures discussed on today's call.

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

Operator: Any copying or rebroadcasting of this call is expressly forbidden without the written consent of Gran Tierra Energy. I will now turn the conference over to Gary Guidry, President and Chief Executive Officer of Gran Tierra. Mr. Guidry, please go ahead.

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

Thank you operator.

Good morning, and welcome to Gran Tierra <unk> second quarter 2025 results conference call.

Gary Guidry: Thank you, operator. Good morning, and welcome to Gran Tierra's Q2 2025 results conference call. My name is Gary Guidry, Gran Tierra's President and Chief Executive Officer. With me today are Ryan Ellson, our Executive Vice President and Chief Financial Officer, and Sebastien Morin, our Chief Operating Officer. On Wednesday, 30 July 2025, we issued a press release that included detailed information about our Q2 2025 results, which is available on our website. Ryan and Sebastien will make a few brief comments, and then we will open up the line for questions. I'll now turn the call over to Ryan to discuss some of our financial results.

My name is Gary Good re Gran Tierra is president and Chief Executive Officer, and with me today Orion Olson, our executive Vice President and Chief Financial Officer and.

Sebastian Maura, our Chief operating officer.

On Wednesday July 32025, we issued a press release that included detailed information about our second quarter 2025 results, which is available on our website.

Brian and Sebastien will make a few brief comments and then we will open up the line for questions I will now turn the call over to Brian to discuss some of our financial results.

Thanks, Gary Good morning, everyone.

Ryan Ellson: Thanks, Gary. Good morning, everyone. Gran Tierra delivered another quarter of strong operational and financial performance, highlighted by record company production, the lowest per barrel operating cost since early 2022, and enhanced liquidity through a number of initiatives and credit capacity. During the quarter, we achieved record production of approximately 47,200 BOE per day, an increase of 1% from the prior quarter and 44% higher than Q2 2024. This continued growth reflects strong performance across Colombia, Ecuador, and Canada, supported by successful drilling campaigns and waterflood execution. Gran Tierra generated sales of $152 million, down 8% from Q2 2024, primarily as a result of a 22% decrease in Brent pricing, which was partially offset by 43% higher sales volume due to higher production and lower South American oil differentials.

<unk> delivered another quarter of strong operational and financial performance highlighted by record company production the lowest per barrel operating costs since early 2022, and enhance liquidity through a number of initiatives and credit capacity.

During the quarter, we achieved record production.

Of approximately 47200 Boe per day.

The increase of 1% from the prior quarter and 44% higher than Q2 2024.

Continued growth reflects strong performance across Colombia, Ecuador, and Canada supported by successful drilling campaigns and waterflood execution.

Gran Tierra generated sales of $152 million Don.

<unk> from the second quarter of 2024, primarily primarily as a result of a 22% decrease in Brent pricing, which was partially offset by 43% higher sales volume due to higher production in <unk>.

Lower South American will differentials oil sales decreased 11% from the prior quarter, primarily due to a 11% decrease in Brent price again, partially offset by lower South American oil differentials.

Ryan Ellson: Oil sales decreased 11% from the prior quarter, primarily due to an 11% decrease in Brent price, again, partially offset by lower South American oil differentials. On a per BOE basis, operating expenses decreased by 17% when compared to Q2 2024, and 16% when compared to the prior quarter, primarily as a result of lower workover activities and lower lifting costs associated with inventory build in Ecuador, power generation, and equipment rentals. This was the lowest operating cost per BOE achieved since Q1 2022. During Q2 2025, Gran Tierra incurred a net loss of $13 million, compared to a net loss of $19 million in the prior quarter and compared to net income of $36 million in the same quarter last year.

On a per BOE basis, operating expenses decreased by 17% when compared to the second quarter of 2024, and 16% when compared to the prior quarter, primarily as a result of lower workover activities and lower lifting costs associated with inventory build in Ecuador, our generation and equipment rentals.

This was the lowest operating cost per BOE, we achieved since the first quarter of 2022.

During the second quarter of 2025 Grand zero or a net loss of $13 million compared to a net loss of $19 million in the prior quarter and compared to net income of 36 million in the same quarter last year.

Funds from operations were 54 million or $1 53 per share up 17% from the second quarter of 2024 and three.

Ryan Ellson: Funds flow from operations were $54 million or $1.53 per share, up 17% from Q2 2024 and down 3% from the prior quarter. Brent price decreased by 11% per barrel compared to the prior quarter, and our cash netback only decreased by 1%, illustrating the resiliency of our portfolio. The company generated adjusted EBITDA of $77 million versus $85 million in the prior quarter and $103 million in Q1 2024. Twelve-month trailing net debt to adjusted EBITDA was 2.3x. However, this only accounts for 8 months of Canadian adjusted EBITDA, and we continue to have a long-term target of 1x. In terms of share buybacks, Gran Tierra purchased approximately 240,000 shares during the quarter.

<unk>, 3% from the prior quarter, Brent price decreased by 11% per barrel compared to the prior quarter and our cash netback only decreased by 1% illustrating the resiliency of our portfolio. The company generated adjusted EBITDA of $77 million versus 85 million in the prior quarter and 103 million in the first quarter of 2000.

24.

12 month trailing net debt to adjusted EBITDA was two three times. However, this only accounts for eight months of Canadian adjusted EBITDA. It will continue to have a long term target of one times.

In terms of share buybacks Gran Tierra purchased approximately 240000 shares during the quarter from January one 2023 digit July 28, 2025, the company repurchased approximately five 2 million shares or 50% of our shares issued.

Ryan Ellson: From 01 January 2023 to 28 July 2025, the company repurchased approximately 5.2 million shares or 15% of our shares issued outstanding on 01 January 2023. Gran Tierra's capital expenditures were $51 million during the quarter, which were lower than the $95 million in the prior quarter and lower than $61 million in Q2 2024. During the quarter, the majority of capital expenditures were incurred in Colombia on Cohembi drilling and infrastructure. In addition to the $61 million cash on hand as of 30 June 2025, the company currently has approximately $112 million in credit and lending facilities with $47 million drawn on 30 June 2025. From a liquidity perspective, Gran Tierra continues to advance multiple strategic initiatives to strengthen liquidity, including potential non-core asset sales, monetization of royalty interest, optimization of free cash flow, and evaluation of prepayment structures.

On January one 2023.

Gran Tierra is capital expenditures were $51 million during the quarter, which were lower than the $95 million in the prior quarter and more than 61 million in the second quarter of 2024 during the quarter. The majority of capital expenditures were incurred in Colombia on won't be drilling and infrastructure.

In addition to the $61 million cash on hand as of June 32025. The company currently has approximately $112 million in credit lending facilities with $47 million drawn on June 32025.

From a liquidity perspective, <unk> continues to advance multiple strategic initiatives to strengthen liquidity, including potential noncore asset sales monetization of royalty interest optimization of free cash flow and devaluation of prepayment structures. All initiatives are progressing in line with our expectations.

Ryan Ellson: All initiatives are progressing in line with our expectations. As part of these strategic initiatives, we have announced that we have signed a mandate letter with a syndicate of banks for a $200 million prepayment facility backed by crude oil deliveries. We are progressing towards full documentation with closing expected in Q3 2025 and funding anticipated shortly thereafter. Also of note, and as part of the completed semi-annual redetermination process, the company received confirmation from its lenders that the borrowing base under its Canadian credit facility remains unchanged at CAD 100 million. This outcome reflects the ongoing strength and stability of the company's Canadian asset base. The revolving credit facility continues to provide $50 million available commitments with a maturity date of 31 October 2026. The next redetermination will be on or before 30 November 2025.

Part of the strategic initiatives, we have announced that we've signed a mandate letter with a syndicate of banks for.

$200 million prepayment facility backed by crude oil deliveries, we are progressing towards full documentation with closing expected in the third quarter of 2025 and funding anticipated shortly thereafter.

Also of note as part of our.

And as part of the completed semiannual Redetermination process. The company received confirmation from its lenders that the borrowing base under its Canadian credit facility remains unchanged at $100 million.

Canadian this outcome reflects ongoing strength and stability of the company's Canadian asset base.

Holding credit facility continues to provide $50 million available commitments with maturity date of October 31, 2026. The next redetermination will be on or before November 32025.

Gran Tierra also employs a disciplined in risk managed hedging strategy designed to protect cash flows support capital planning enhance financial stability across commodity cycles. The company utilizes a diverse mix of oil and gas hedges with structures that provide downside protection, while preserving upside exposure.

Ryan Ellson: Gran Tierra also employs a disciplined and risk-managed hedging strategy designed to protect cash flows, support capital planning, and enhance financial stability across commodity cycles. The company utilizes a diverse mix of oil and gas hedges with structures that provide downside protection while preserving upside exposure. This proactive approach contributed to a $14 million derivative of hedging gain during the quarter. The company also maintains a rolling 12-month foreign exchange hedging program to further mitigate currency volatility. Gran Tierra implemented a robust hedging program to manage price volatility across its operations. For H2 2025, the company's hedged approximately 50% of its South American oil production and 60% of its Canadian oil production. For H1 2026, hedge coverage stands at roughly 33% for South America and 50% for Canada.

This proactive approach contributed $14 million driven hedging gain during the quarter.

The company also maintains a rolling 12 month foreign exchange hedging program to further mitigate currency volatility.

Gran Tierra implement a robust hedging program to manage price volatility across its operations for the second half of 2025. The company has hedged approximately 50% of its south American oil production and 60% of its Ken oil production for the first half of 2026 hedge coverage stands at roughly 33% for South America, and 50% for Canada.

The pricing levels of these hedges are aligned with the company's plan assumptions and provide downside protection, while preserving upside exposure Gran Tierra is also hedged approximately 40% was clean natural gas production for the second half of 2025. In addition to help manage foreign exchange risk because we've got a 12 month COPD USD hedging program in April.

Ryan Ellson: The pricing levels of these hedges are in line with the company's planning assumptions and provide downside protection while preserving upside exposure. Gran Tierra has also hedged approximately 40% of its Canadian natural gas production for H2 2025. To help manage foreign exchange risk, the company began a 12-month COP to USD hedging program in April 2025, covering approximately $10 million per month. We also continue to optimize our portfolio with the signed disposition of the UK North Sea assets for approximately $7.5 million, which is expected to close in Q3 2025.

2025, covering approximately $10 million USD per month.

We also continue to optimize our portfolio with design disposition in the UK North sea assets for approximately $7 5 million, which is expected to close in the third quarter of 2025.

Overall Gran Tierra second quarter performance continues to demonstrate our commitment to capital discipline and operational excellence by delivering record production and reported lower operating expenses per barrel, while also enhancing our liquidity position through a number of initiatives that financial flexibility heading into the second half of 2026.

Ryan Ellson: Overall, Gran Tierra's Q2 performance continues to demonstrate our commitment to capital discipline and operational excellence by delivering record production and reporting lower operating expenses per barrel, while also enhancing our liquidity position through a number of initiatives to add financial flexibility heading into H2 2026. I'll now turn the call over to Sebastien to discuss some of the highlights of our current operations.

Now I'll turn the call over to Sebastian discuss some of the highlights of our current operations.

Good morning, everyone and thank you Ryan.

Operationally Gran Tierra delivered another strong quarter building on the momentum from Q1 and continuing to advance key initiatives across our core areas in Colombia, Ecuador, and Canada Star.

Sebastien Morin: Good morning, everyone, and thank you, Ryan. Operationally, Gran Tierra delivered another strong quarter, building on the momentum from Q1 and continuing to advance key initiatives across our core areas in Colombia, Ecuador, and Canada. Starting in Colombia, total working interest production averaged approximately 25,100 barrels of oil per day during the quarter, driven by successful development drilling at Cohembe and Costayaco and continued improvements in waterflood execution in Costayaco, Cohembe, and Acordionero. At Cohembe, the remaining 2 wells from our 5-well North Pad program were brought onto production. Average drilling cost was approximately $3 million per well, representing a 47% reduction from the previous operator's historical costs. Injection of 8,000 barrels of water injected per day in the newly delivered North Pad began in June.

Starting in Colombia total working interest production averaged approximately 25100 barrels of oil per day.

During the quarter.

Driven by successful development drilling at <unk> and of course, the ankle and continued improvements in waterflood execution and cost geopolitical Hindi and accordion arrow.

So hendi the remaining two wells from our five well North pad program were brought onto production average drilling cost was approximately 3 million per well, representing a 47% reduction from the previous operator's historical costs.

Injection of 8000 barrels of water injected per day and the newly delivered North pad began in June.

Already we are seeing a strong waterflood response with gross production increasing by 2600 barrels of oil per day in the northern area of the field.

Sebastien Morin: Already, we are seeing a strong waterflood response, with gross production increasing by 2,600 barrels of oil per day in the northern area of the field. At Costayaco, we completed and brought onstream the Costayaco-63 and Costayaco-64 development wells. Both wells were stimulated and placed on production, with initial results exceeding expectations. Costayaco-63 is currently producing 800 barrels of oil per day with a 48% water cut, and Costayaco-64 is producing 1,300 barrels of oil per day with only a 13% water cut. The final well in the program, Costayaco-65, was spud in July and is expected to be on production in August. At Acordionero, we achieved record total fluid production of 89,400 barrels per day and water injection of 85,000 barrels per day during the quarter. Field production averaged 14,200 barrels of oil per day, up from 13,800 in Q1.

Cause Seattle, we completed and brought on stream the <unk> 63, and <unk> 64 development wells.

Both wells were stimulated and placed on production with initial results exceeding expectations.

<unk> 63 is currently producing 800 barrels of oil per day with a 48% water cut.

And of course, the <unk> 64 is producing 3500 barrels of oil per day with only a 13% water cut.

The final well in the program costs of <unk> 65 was spud in July and is expected to be on production in August.

At accordion Arrow, we achieved record total fluid production of 89400 barrels per day and water injection of 85000 barrels per day during the quarter field.

Field production averaged 14200 barrels of oil per day up from 13800 in Q1.

This improvement reflects continued gains and pump upsizing enhanced.

Sebastien Morin: This improvement reflects continued gains in pump upsizing, enhanced surface capacity, and real-time waterflood surveillance. Moving to Ecuador, we continue to execute our strategy and fulfill our commitments. Civil works are underway in preparation for drilling 2 high-impact exploration wells at the Conejo Prospect on the Charapa Block, with spud expected in late Q3. These will be the final wells under our exploration commitments in the country. The results will help guide further development plans and infrastructure alignment in the region. In Canada, the Simonette Montney program continues to outperform. The first 2 lower Montney wells were completed and brought onstream in early April and are currently exceeding management's type curve expectations. The third well in the program was drilled and cased successfully in July. The rig was moved to the next location on the pad and is now drilling the fourth well in the program.

Enhanced surface capacity and real time waterflood surveillance move.

Moving to Ecuador, we continue to execute our strategy and fulfill our commitments.

Civil works are underway in preparation for drilling two high impact exploration wells at the <unk> prospect on the <unk> block.

We spud expected in late Q3.

These will be the final wells under our exploration commitments in the country. The results will help guide further development plans and infrastructure alignment in the region.

In Canada, the Simon at Montney program continues to outperform the first two lower Montney wells are completed and brought on stream in early April and are currently exceeding managements type curve expectations.

The third well in the program was drilled in case successfully in July was <unk>.

Move to the next location on the pad and is now drilling the fourth well in the program.

The well is expected to reach total depth in August.

Sebastien Morin: The well is expected to reach total depth in August. Both of these new wells are expected to be stimulated and put onstream in Q4. Across the portfolio, we remain focused on capital efficiency, reservoir optimization, and unlocking further value from our diverse asset base. The success of our drilling programs, enhanced field performance, and reduced operating costs position us well to deliver free cash flow and strengthen our financial position through the H2 of 2025. Looking ahead, we remain focused on continuing to ramp base production at Cohembi North and Costayaco from our Q1 and Q2 development programs, which are delivering very positive results. Optimizing Acordionero production with continued waterflood enhancements and facility optimizations. Initiating the high-impact Conejo exploration wells in Ecuador to unlock additional value from the Oriente Basin. Completing and bringing online the third and fourth Simonette Montney wells, while optimizing existing field production.

Both of these new wells are expected to be stimulated and put on stream in Q4.

Across the portfolio, we remain focused on capital efficiency reservoir optimization and unlocking further value from our diverse asset base. The success of our drilling programs enhanced field performance and reduce operating cost position us well to deliver free cash flow and strengthen our financial position through the second half of 2025.

Looking ahead, we remain focused on continuing to ramp based production at <unk>, North and cluster Jaco from our Q1 Q2 development programs, which are delivering very positive results optum.

Optimizing accordion arrow production with continued waterflood enhancements and facility optimization initiating.

Initiating the high impact exploration wells and Ecuador to unlock additional value from the Oriental Basin <unk>.

Completing and bringing online the third and four assignment at Montney wells, while optimizing existing field production maintaining.

<unk> capital and operational cost discipline, while targeting free cash flow generation in the second half of the year.

Sebastien Morin: Maintaining capital and operational cost discipline while targeting free cash flow generation in H2 of the year. I will now turn the call back to the operator, and Gary, Ryan, and I will be happy to take questions. Operator, please go ahead.

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

Thank you, ladies and gentlemen, we will now conduct a question and answer session for Securities analysts. If you have a question. Please press the star key followed by one one on your touch tone phone you will then hear an automated message advising that your hand is raise your question, we'll be pulling in the order they are received.

Operator: Thank you. Ladies and gentlemen, we will now conduct a question and answer session for securities analysts. One moment, please, for our first question. The first question will come from David Round with Stifel.

Please ensure you lift your handset if you're using a speaker phone before pressing any key.

And one moment please for our first question.

The first question will come from David round with Stifel. Your line is now open.

Great. Thank you.

Thanks for making the time guys can I start with a broad question on production. Please.

David Round: Great. Thank you. Thanks for making the time, guys. Can I start with a broad question on production, please? I know we just touched on a few of the key highlights. I just want to dig into it a bit more, if possible. Firstly, I guess I'm interested in how production has gone so far this year versus where you thought you'd be at the start of the year, whether there were any positive, negative surprises there, any highlights just to bring out. I know we just briefly mentioned Costayaco, Acordionero. I suppose, are we able to just elaborate on current contributions and expectations, I guess, for H2 and beyond for, I suppose, the key moving parts, Suroriente, Ecuador, and Nisku. I don't know if you're able to just elaborate on some of the specifics there.

No. We just touched on a few of the key highlights I just wanted to dig into a bit more possible.

So firstly I guess I'm interested in how production has done so far this year versus where you thought you'd be at the start of the year.

Whether there were any positive or negative surprises that any highlights just to bring out.

I know, we just briefly mentioned sort of.

Costa Jaco accordion era I suppose are we able to just kind of elaborate on current contributions and expectations I guess rates two and beyond for the key moving parts Syrian Ecuador, and Simon at I don't know if youre able to just elaborate on some of the specifics.

I think at a very high level.

Ryan Ellson: I think at a very high level, all of our fields have been performing as expected or beyond expectations. We have the normal interruptions, both in Colombia and Ecuador with blockades, but we have a very good team that manage those, the impact. We've seen also some infrastructure issues. There's one that's just finishing up in Ecuador at the moment with very heavy rains, pipeline interruption. In general, the answer to your question is from a field and asset performance, everything has performed as expected or outperformed, and that's both in Canada, Colombia, and Ecuador. On the specifics, maybe Sebastien, you could say a few words about rates.

All of our fields have been performing as expected or are beyond expectations, we have the normal interruptions.

Both in Colombia, and Ecuador, with blockades, but we have a very good team that manage those impacts.

We've seen also some some infrastructure issues there. There's one that's just finishing up in Ecuador at the moment with a with a.

Very heavy rains.

Pipeline interruption.

But in general the answer to your question is from a field and asset performance everything has performed as expected or outperformed in.

That's both in Canada.

Colombia, and Ecuador on specifics, maybe Sebastian you can say a few words about rates, yes. So on rates I think we continue to be very excited we did.

Sebastien Morin: Yeah. On rates, I think we continue to be very excited. We did a ESP conversion over on Charapa B7, which has, again, highlighted the quality of the Basal Tena in Ecuador. That well is currently doing 1,800 barrels of oil per day, and decline is extremely flat. We've had some significant wins as well within the portfolio, especially as we continue to develop in Ecuador. At Cohembi, the pressure response that we're seeing is really encouraging. We see that ramping up through Q3 and Q4.

ESP conversion over on trap of the southern which is again highlighted the quality of the batesville tenor in Ecuador, and so that well is currently doing 800 barrels of oil per day and decline is extremely flat. So we've had some significant wins as well within within the portfolio, especially as we continue to.

Developed in Ecuador, and then it co hendi. The pressure response that we're seeing is really encouraging and so we see that ramping up through Q3 and Q4.

Okay. So just a very quick follow up on that point.

David Round: Okay. Just then a very quick follow-up on that point. Actually, if I think about all three of those areas I mentioned, so Simonette, Cohembe, and Ecuador, should we be assuming ramp up on all those assets over the H2 of this year?

If I think about all three of those areas I mentioned Simon at the end.

And Ecuador.

Should we be assuming ramp up on all of those assets over the second half of this year.

Yes, okay.

Yes.

Ryan Ellson: Yes.

Just a second question then.

David Round: Okay, fine. Just a second question then, and I appreciate it's not final, but just on the prepay, can you say anything, even in broad terms, about how that might work or just indicatively what that might cost, or are we too early on that one?

I appreciate it's not final, but just on the prepaid can you say anything even in broad terms about how that might work or just sort of indicative really what that might cost or are we too early on that one.

Yes no.

The high level.

Ryan Ellson: Yeah, no. At a high level, we will be committing to essentially selling oil for future prepayments. It's going to be over about a 4-year term. It's quite long-term in nature, not a huge grind on our cash flows. Just think of it as a loan that really amortizes over 4 years, settled with oil payments. The terms will be very competitive. We're quite excited about it. It's similar to what we've done in the past. It'll just be a longer tenor.

We will be committing to essentially sell.

All in all.

Oil for future prepayments is going to be over about a four year term.

So it was quite long term in nature, not a huge grind on our cash flows. So just think of us.

Loan that really are amortized over four years, so settled with oil payments.

So the terms will be very very competitive.

And we're quite excited about it and so and it's similar to what we've done in the past.

It will be a longer tenor.

Okay, great. Thank you I'll hand, it back.

David Round: Okay, great. Thank you. I'll hand it back.

Thanks.

And the next question will come from Anne Milne with Bank of America. Your line is open.

Ryan Ellson: Thanks.

Operator: The next question will come from Anne Milne with Bank of America. Your line is open.

Alright. Thank you good morning, congratulations on your results.

Anne Milne: Thank you. Good morning. Congratulations on your results. I have a few questions, relatively short, hopefully. The first is, could you provide us with any additional updates or your thoughts on other asset sales for this year? I believe you mentioned the UK North Sea, $seven and a half million. I think there were a couple others on the list there. That would be the first question.

I have a few questions relatively short hopefully.

First is could you provide us with an additional any additional updates or your thoughts on other.

Other asset sales for this year I believe you mentioned the U K North sea $7 5 million.

I think there were a couple of others on the list lift there.

That would be the first question.

Yes, the answer to that question is we have several things that are ongoing.

Ryan Ellson: Yeah. The answer to that question is we have several things that are ongoing. We have nondisclosure agreements in place, so we're really not talking about those, but we are very actively looking at our portfolio to divest of non-core assets and in some other areas to dilute our interest. You'll see more of that here over the Q3.

And we have.

Non disclosure.

Non disclosure agreements in place. So we're really not talking about those but we are very actively looking at it.

That's it.

Our portfolio to divest of noncore assets and in some other areas to dilute our interest and so youll see more of that here over the third quarter.

Okay very good thank you.

And then in terms of your guidance that you had previously given.

Anne Milne: Okay, very good. Thank you. Then in terms of your guidance that you had previously given, I look quickly at your presentation here versus what you had last quarter. I do see there is a comment that you're looking to generate $20 million of free cash flow this year. Yet for your $65 a barrel assumption, in terms of the guidance, there was 0 free cash flow. Could you just tell us what you're thinking? Then since you've sort of front-loaded your CapEx for 2025, will some of this come from lower CapEx and this additional new production that's coming online from a number of your fields?

Look quickly at your presentation here versus what you had last quarter I. Just see there is a comment that you are looking to generate $20 million of free cash flow this year, but yet for your $65 a barrel assumption.

In terms of the guidance there was even a free cash flow could you just tell us what youre thinking and then since you sort of Frontloaded your capex for 2025.

Some of this come from.

Lower Capex and this additional new production that's coming on line from the number of your fields.

Yes.

Great question the biggest driver on that is just lower capex.

Ryan Ellson: Yeah. Great question. The biggest driver on that end is just lower CapEx. The team's done a great job of executing the program, and we continue to look at how do we optimize that in the second half of the year. The number 1 driver is, obviously, oil price is somewhat supportive right now at $70 and very tight differentials in Colombia and Ecuador. The main driver will be on the CapEx side.

The team's done a great job of executing the program and so we continue to look at how do we optimize that in the second half of the year. So the number one driver of the August.

Oil prices somewhat supportive right now at $70 and very very tight differentials in Colombia.

<unk>.

But the main driver will be on the Capex side.

Okay.

And then just tell me if I'm missing something but do you breakdown EBITDA by country in the presentation here I don't think I saw it but.

Anne Milne: Okay. Just tell me if I'm missing something, but do you break down EBITDA by country in the presentation here? I don't think I saw it, but I might be missing it.

Don.

We don't.

Ryan Ellson: We don't. In our press release, we have more details by country as far as net backs and whatnot, but not EBITDA.

And in our press release, we have more details by country as far as net backs and whatnot, but not not EBITDA.

Okay, and then I guess final question would be.

Anne Milne: Okay. I guess final question would be, Colombia, there have been a lot of, I guess you could say pipeline disruption and other types of disruptions, I think there were some export taxes that I know they affected Ecopetrol. Do they affect Gran Tierra? Could you tell us what the operating environment in Colombia, what impact it might have had on your, either the operations or, I know you've sort of hinted at that in some of your comments, or on any sort of financial metrics you have?

Columbia, there have been a lot of.

I guess, you could say pipeline disruption and other types of disruptions and I think there were some export taxes that I know they affected our call patrol do the ASR Gran Tierra could you tell us what the operating environment in Colombia, what impact it might have had on you either at the operations or and I know you've sort of hinted at that in some of your comments or on any sort.

Financial metrics you have.

Yeah on the export tax who we.

Ryan Ellson: Yeah. On the export tax, we've been unaffected. The main thing that's impacted us is pipeline disruptions in Ecuador. As Sebastien mentioned, there were some significant landslides. Obviously, it's not our pipelines, but there was some disruptions in Ecuador on the pipelines. That more impacted our Ecuador production in the first part of July. All the pipelines are back in operation, and it's normal operations.

Been unaffected.

The main thing that's impacted us.

<unk> pipeline disruptions in Ecuador, as Sebastian mentioned that there were some significant land slides and obvious.

It's on our pipelines, where there was some disruptions in accrual on the pipelines and so a lot more impacted our total production in the first part of July but all the product all the pipelines are back in operation and we're in the store.

Normal operations.

Okay, great. Thank you very much thanks for answering my questions. Thanks, Ed.

Anne Milne: Okay, great. Thanks very much. Thanks for answering these questions.

And the next question will come from Josef Schachter with Schachter Energy Your line is open.

Ryan Ellson: Thanks, Anne.

Operator: The next question will come from Josef Schachter with Schachter Energy. Your line is open.

Good morning, Gary Ryan and Sebastian.

Josef Schachter: Morning, Gary, Ryan, and Sebastien. First question for me. You've got a range of 47,000 to 53,000 for production this year, your average for the H1, 47. What needs to happen to get to 50? What needs to happen to get to 53 in terms of your forecast?

First question for me.

You've got a range of.

<unk> 47 to 53000 for production this year your average for the first half 47, what needs to happen to get to 50, what needs to happen to get to 53 in terms of your forecast.

Yeah.

Thank you Josef I think the answer to that is we have the capacity we have the production capacity.

Gary Guidry: Yeah. Thank you, Josef. I think the answer to that is we have the capacity, we have the production capacity. It's no disruptions, and we're working through that. Yes, the answer is we're at the lower end of our guidance, but we're still easily within our guidance, and our target is to be at the upper end. We're going to do our best to ramp. I think Anne Milne asked the question, or David Round asked the question. Yeah. We have most of our capital deployed. We've had some excellent results in Cohembi, excellent results in Costayaco. The waterflood is going in the right direction in Cordón Verde. All of that's there. The exciting one as well is Ecuador. We're just going through our field development plan approvals with the government, and these are some fantastic reservoirs.

It's no disruptions.

And we we're working we're working through that where yes. The answer is we are at the lower end of our guidance, but we're still easily within our guidance and our target is to be at the upper end, we're going to do our best to ramp I think and ask the question.

David around asked the question, yes, we have most of our capital deployed we've had some excellent results in <unk> excellent results.

The Alco.

The waterflood is going in the right direction and.

Accordingly, <unk>, so all of that there.

Exciting ones as well as Ecuador, we're just going through our field development plan approvals with the government.

These are some some fantastic reservoirs.

Sebastian I alluded to.

Gary Guidry: As Sebastien alluded to, the performance is very clear that we're going to be doing some waterflooding, quick response. Not only the H2, but the next few years, we're quite excited about where we're going with our capital and capital allocation with some fantastic reservoirs.

The performance is very clear that that we're going to be doing some some water flooding.

Quick response, so not only the second half of the year, but the next few years, we're quite excited about about where we're going with.

Our capital and capital allocation with with some fantastic reservoirs.

Okay.

That's it for me.

Josef Schachter: Okay. Second question from me. In your Canadian side, where you have the Central, 12,500 BOEs a day, 49% working interest, how much of that do you operate? Where do you see any potential growth for you in that Central area? Does that include things like the Belly River? How do you see upside from that part of the portfolio?

And your Canadian side, where you have the central 12.

<unk> thousand 500, Boe's a day.

49% working interest how.

How much of that do you operate.

And where do you see any.

Potential growth for you in that central area does that.

Does that.

Include things like the belly River, how do you see.

Outside from that part of the portfolio.

Yes, I think to go back on sort of the transaction questions that we're talking about there's a ton of opportunity in central and the nice part is is we do have a lot of linking infrastructure and so the team is actively working the central portfolio and.

Ryan Ellson: Yeah, I think to go back on sort of the transaction questions that we were talking about, there's a ton of opportunity in Central. The nice part is we do have a lot of linking infrastructure, and so the team is actively working the Central portfolio. I won't talk to a specific formation because there's many of them. Starting from the Nisku to the Glauconite, and the team's been working on how do we optimize that portfolio. I think that's kind of the approach that we're taking, is where it makes sense to have some synergies, especially on third-party processing fees and so on and so forth, to optimize again, on cost, but also in terms of profit.

I won't talk to specific formation, because there's there's many of them.

Starting from the net skew to the Glock and.

The team has been working on how do we optimize that portfolio and so I think I think that's kind of.

The approach that we're taking is where it makes sense to have some synergies, especially on on third party processing fees and so on and so forth to optimize again on cost, but also in terms of profit.

Okay Super Thanks for that and we're.

Josef Schachter: Okay, super. Thanks for that input. Sure looking forward to seeing Q3 and Q4 with the results. Thanks very much.

We're looking forward to seeing Q3 and Q4.

With the results so thanks very much.

Thanks.

And our next question will come from Peter <unk> with Jefferies. Your line is open.

Gary Guidry: Thanks.

Operator: Our next question will come from Peter Bohle with Jefferies. Your line is open.

Hi, Thank you for the call and the opportunity for two questions. First question is after you know recently, increasing your hedges for 2026 is the strategy to continue increasing hedges, even further or are you comfortable at this level and the second question is just regarding some report or media that there was an mou side.

Peter Bohle: Hi. Thank you for the call and the opportunity for 2 questions. First question is, after recently increasing your hedges for 2026, is the strategy to continue increasing hedges even further, or are you comfortable at this level? The second question is just regarding some report or media that there was an MoU signed for potential entry into the Azerbaijani market. Could you share any updates there or any expected timing if you are contemplating a market entry there? Thank you.

And for potential entry into the Azerbaijani market could you share any updates there or any expected timing. If you are contemplating a market entry there. Thank you.

Great. Thanks, Yeah on the hedging front.

Ryan Ellson: Great. Thanks. Yeah. On the hedging front, what we've been communicating is that we're putting more of a structured plan in. Our objective is to hedge 30% to 50%, 6 months out, and then 20% to 30% the following 6 months on a continuous basis. As a month rolls off, we will add hedges for the following month that it rolled off. We continue to have a continued, more systematic hedging program.

What we've been communicating as we bring more of a structured plan is and so our objective is to hedge $30, 50% six months out and then <unk> 30, 20% to 30% fall in six months on a continuous basis. So we will as a month rolls off we will add hedges for the following month that rolled off.

So we do continue to do more systematic hedging program.

Yes. Your question on Azerbaijan, Yes in fact, we did sign an Mou.

Gary Guidry: Yeah. On your question on Azerbaijan, yes. In fact, we did sign an MoU. We're working with the government of Azerbaijan, with SOCAR, the national company, on progressing that to a production sharing agreement. What I will say about what we're doing in Azerbaijan, this is the one thing in our portfolio that we've been trying to add for the last 5 or 6 years, looking in specific basins around the world where you have an order of magnitude opportunity greater than we have currently in terms of Colombia, Ecuador, Canada, where you can find multi-TCF type fields. You can find a couple of 100 million barrel oil fields. It's a very large block of land in a very prospective part of the country onshore, and we're very excited about it.

We're working with the governments.

John with SOCAR.

But the National company.

Progressing that to a production sharing agreement and what I'll say.

What I will say about about what we're doing in Azerbaijan.

This is this is the one thing in our portfolio.

That's what we've been trying to add for the last five or six years looking at specific basins around the world, where you have an order of magnitude opportunity greater than than we have currently in terms of Colombia, Ecuador, Canada.

You can find multi tcf type deals you can find a couple of hundred million barrel oil fields.

And so it's a very large block of land in a very perspective part of the country.

Onshore.

And we're very excited about it you'll hear more about it when we go to a definitive agreement with a production sharing agreement hopefully in.

Gary Guidry: You'll hear more about it when we go to a definitive agreement with a production sharing agreement, hopefully, in Q3, Q4 here. Yeah, we're very excited about Azerbaijan.

And the third third and fourth quarter here and so yes, we're very excited about Azerbaijan.

Thank you.

And our next question will come from Garik <unk> with J H Lane partners. Your line is open.

Peter Bohle: Thank you.

Operator: Our next question will come from Garrett Fellows with J.H. Lane Partners. Your line is open.

Hey, guys.

Thanks for taking my question. So I mean, you've listed a few other ways of raising capital here and the royalties on craft with Alex I guess I'm curious why why we felt the need to do the Portland sale sort of loan agreement.

Garrett Fellows: Hey, guys. Thanks for taking the question. You listed a few other ways of raising capital here, the royalties on core asset sales. I guess I'm curious why we felt the need to do the forward sale sort of loan agreement now, if the assumption is that this was to de-risk the $184 million amort payment next year, why do we need to pay a full year of interest on it? Or maybe there's something else going on that I don't know. Thanks.

Wow.

If the assumption is that this was to derisk can be $184 million and more payment.

Why do you need to pay a full year of interest on it or maybe theres something else going on that that I don't know.

Yes, no good question and I think part of it is.

Ryan Ellson: Yeah, no, it's a good question. I think part of it is the number one concern I think people had with the company was addressing next year's maturity. We think we're proactively addressing the maturity. In respect to the interest, the way we've structured things, there's actually going to be a very low negative carry on the transaction. Again, de minimis negative carry just with investments that we can do and some tax efficiency that we have. We thought now would be the time to proactively address that and with very minimal cost.

The number one concern I think people will add with the company was addressing next year's maturity.

And so we think we're proactively addressing the maturity and respect to the interest.

Way, we've structured things.

It's going to be a very low negative carry on the transaction. So.

Again de Minimis negative carry just with investments that we can do and and some tax.

Efficiency that we have and so we thought now would be the time to proactively address that.

Minimal cost.

Okay.

Okay, Great and then I guess.

Garrett Fellows: Okay. Okay, great. I guess, quickly on Azerbaijan, could you walk us through the kind of cadence of how this project progresses? Let's say you have a signed MoU or a signed production sharing agreement in H2. How does this project progress from there?

Quickly on the Azerbaijan.

Could you could you walk us through the kind of cadence.

Of how this project progressing let's say you have signed Mou or signs that have some sharing in.

In the back half of the year.

How does this project progress from there.

Yeah.

It's a five year.

Gary Guidry: Yeah. It's a 5-year first phase, very low cost in terms of the reward that's in front of us. There's no pressure in terms of timing. We have a full 5 years from the time the Congress ratifies a PSA. Timing that we see, there are discoveries on the block. It is very close to infrastructure. Gas, there's a very prolific price for both domestic and European exports. There's room in pipelines, and so that explains our excitement about having big structures in a very prolific oil and gas basin, and it really is just applying modern technology that we'll apply over the next years to come. That is the timing. It's a 5-year program. We'll disclose more about it, but a low cost of entry that we see in terms of the reward that's potentially there.

First phase very low cost.

In terms of the reward.

That's that's in front of us and so there is no pressure in terms of timing we have a full five years from the time the.

The Congress ratifies.

PSA.

And so timing now that we see there there are discoveries on the block.

It is very close to infrastructure.

Yes.

A very very prolific price for both domestic and European exports, there's there's room in pipelines and so.

That explains our excitement about having big structures and a very prolific.

Oil and gas basin and it really is just applying modern technology that will apply over the next next years to come and so that that is the timing, it's a five year program.

And then we'll disclose more about it but.

Our low cost of entry that we see with <unk>.

In terms of the reward.

Potentially there.

Got it.

In terms of when you could actually start producing after the PSA side.

Garrett Fellows: Got it. Just in terms of when you could actually start producing after the PSA is signed?

Yeah.

Yes.

Depending on a proven discovery.

Gary Guidry: Depending on a proven discovery, within that same year.

Within that same year.

Okay, great. Thank you guys very much.

Garrett Fellows: Okay, great. Thank you guys very much.

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

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

I would once again like to thank everyone for joining US today, we look forward to speaking with you over the next quarter and update you on our ongoing progress. Thank you.

Gary Guidry: I would once again like to thank everyone for joining us today. We look forward to speaking with you over the next quarter and update you on our ongoing progress. Thank you.

This concludes today's conference call. Thank you for participating and you may now disconnect.

Operator: This concludes today's conference call. Thank you for participating, and you may now disconnect.