Gran Tierra Energy Inc. Reports Robust Reserves Replacement and Record High Reserves

Total Liquids 1P and 2P Reserves Increased to 128 and 217 Million Barrels of Oil Equivalent with 1P and 2P Reserve Life Index increasing to 10 and 17 Years, Respectively

Added Total Reserves of 89 MMBOE 1P, 159 MMBOE 2P and 191 MMBOE 3P

Net Present Value Before Tax Discounted at 10% of $2.0 Billion (1P), $3.2 Billion (2P), and $4.5 Billion (3P)

Net Asset Value per Share of $35.24 Before Tax and $19.53 After Tax (1P), and $71.16 Before Tax and $41.05 After Tax (2P)

Strong Finding, Development & Acquisition Costs of $4.49 (1P), $2.52 (2P) and $2.10 (3P), Excluding Changes in Future Development Costs

CALGARY, Alberta, Jan. 23, 2025 (GLOBE NEWSWIRE) -- Gran Tierra Energy Inc. (“Gran Tierra” or the “Company”) (NYSE American:GTE)(TSX:GTE)(LSE:GTE), an independent international energy company focused on oil and natural gas exploration and production in Canada, Colombia and Ecuador, today announced the Company’s 2024 year-end reserves as evaluated by the Company’s independent qualified reserves evaluator McDaniel & Associates Consultants Ltd. (“McDaniel”) in a report with an effective date of December 31, 2024 (the “GTE McDaniel Reserves Report”).

All dollar amounts are in United States (“U.S.”) dollars and all reserves and production volumes are on a working interest before royalties (“WI”) basis (net). Reserves are expressed in barrels (“bbl”), bbl of oil equivalent (“boe”) or million boe (“MMBOE”), while production is expressed in boe per day (“BOEPD”), unless otherwise indicated. The following reserves categories are discussed in this press release: Proved Developed Producing (“PDP”), Proved (“1P”), 1P plus Probable (“2P”) and 2P plus Possible (“3P”).

Gary Guidry, President and Chief Executive Officer of Gran Tierra, commented: “2024 was another strong year underpinned by multiple exploration discoveries in Ecuador, continued success in managing our Colombian assets, and our new country entry into Canada. The organic and inorganic portfolio growth creates a future runway of highly economic development opportunities in proven plays with access to infrastructure. Gran Tierra’s entry into Canada fits our corporate strategy of focusing on proven hydrocarbon basins which have access to established infrastructure and competitive fiscal regimes. Furthermore, with the addition of Canada, Gran Tierra is well positioned for long-term commodity cycles with approximately 20% of its production, 23% 1P reserves and 26% 2P reserves now attributed to conventional natural gas and shale gas.

We continue to generate shareholder value through focusing on portfolio longevity and executing on our mandate of growing cash flow and reserves, while maintaining low decline rates through production, development and enhanced oil recovery techniques. Gran Tierra has assembled a diversified, high-quality asset base across multiple attractive jurisdictions and combined with our management team’s strong track record of accretive acquisitions and value creation, we look forward to a successful 2025.

The success of 2024 is reflected in yet another year of over 100% reserve replacement on a Proved basis. Gran Tierra achieved strong 702% (1P), 1,249% (2P) and 1,500% (3P) reserves replacement through exploration success in Colombia and Ecuador and our entry into Canada. This success resulted in record highs for the Company’s year-end 1P, 2P and 3P oil and gas reserves.”

*See the below tables for the definitions of net asset values per share.

Highlights

2024 Year-End Reserves and Values

1Based on estimated unaudited 2024 year-end Net Debt of $682 million comprised of Senior Notes of $787 million (gross) less cash and cash equivalents of $104 million, prepared in accordance with GAAP.

As of December 31, 2024, Gran Tierra achieved:

Before Tax NAV of $1.3 billion (1P), $2.6 billion (2P), and $3.8 billion (3P)

After Tax NAV of $0.7 billion (1P), $1.5 billion (2P), and $2.2 billion (3P)

Strong reserves replacement ratios* of:

702% 1P, with 1P reserves additions of 89 MMBOE

1,249% 2P, with 2P reserves additions of 159 MMBOE

1,500% 3P, with 3P reserves additions of 191 MMBOE

Finding, development and acquisition costs (“FD&A”), including change in future development costs (“FDC”), on a per boe basis of $9.74 (1P), $8.11 (2P) and $6.92 (3P).

FD&A costs excluding change in FDC, on a per boe basis of $4.49 (1P), $2.52 (2P) and $2.10 (3P).

Canada now represents 46% of 1P and 51% of 2P reserves compared to Gran Tierra’s total reserves.

FDC are forecast by McDaniel to be $1,029 million for 1P reserves and $1,809 million for 2P reserves. Gran Tierra’s 2025 base case mid-point guidance for cash flow** of $280 million is equivalent to 27% of such 1P FDC and 15% of 2P FDC, which highlights the Company’s potential ability to fund future development capital. Increases in FDC relative to 2023 year-end reflect that the GTE McDaniel Reserves Report now assigns Gran Tierra 227 Proved Undeveloped future drilling locations (up from 95 at 2023 year-end) and 441 Proved plus Probable Undeveloped future drilling locations (up from 147 at 2023 year-end).

*The reserve replacement ratios were calculated based on an annualized production figure based on November and December for Canada plus Colombia and Ecuador actual production, in each case, for the fourth quarter of 2024. The total production rate was 46,619 BOEPD.

** “Cash flow” refers to GAAP line item “net cash provided by operating activities”. Gran Tierra’s 2025 base case guidance is based on a forecast 2025 average Brent oil price of $75/bbl. See Gran Tierra’s press release dated January 23, 2025 for additional information regarding cash flow guidance referred to herein. This forecast price used in Gran Tierra’s forecast is lower than the 2025 McDaniel Brent price forecast.

GTE McDaniel Reserves Report

All reserves values, future net revenue and ancillary information contained in this press release have been prepared by McDaniel and calculated in compliance with Canadian National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (“NI 51-101”) and the Canadian Oil and Gas Evaluation Handbook (“COGEH”) and derived from the GTE McDaniel Reserves Report, unless otherwise expressly stated.

Future Net Revenue

Future net revenue reflects McDaniel’s forecast of revenue estimated using forecast prices and costs, arising from the anticipated development and production of reserves, after the deduction of royalties, operating costs, development costs and abandonment and reclamation costs but before consideration of indirect costs such as administrative, overhead and other miscellaneous expenses. The estimate of future net revenue below does not necessarily represent fair market value.

Consolidated Properties at December 31, 2024

Proved (1P) Total Future Net Revenue ($ million)

Forecast Prices and Costs

Consolidated Properties at December 31, 2024

Proved Plus Probable (2P) Total Future Net Revenue ($ million)

Forecast Prices and Costs

Consolidated Properties at December 31, 2024

Proved Plus Probable Plus Possible (3P) Total Future Net Revenue ($ million)

Forecast Prices and Costs

*The after-tax future net revenue of the Company’s oil and gas properties reflects the tax burden on the properties on a stand-alone basis. It does not consider the corporate tax situation, or tax planning. It does not provide an estimate of the value at the Company level which may be significantly different. The Company’s financial statements, when available for the year ended December 31, 2024, should be consulted for information at the Company level.

Total Company WI Reserves

The following table summarizes Gran Tierra’s NI 51-101 and COGEH compliant reserves in aggregate for Colombia, Ecuador and Canada derived from the GTE McDaniel Reserves Report calculated using forecast oil and gas prices and costs.

*Mbbl (thousand bbl of oil).

**MMcf (million cubic feet).

***Mboe (thousand boe).

Net Present Value Summary

Gran Tierra’s reserves were evaluated using the average of three independent qualified reserves evaluators’ commodity price forecasts at January 1, 2025 (McDaniel, Sproule and GLJ). See “Forecast Prices” for more information. It should not be assumed that the net present value of cash flow estimated by McDaniel represents the fair market value of Gran Tierra’s reserves.

* Calculated using an annualized WI production figure based on November and December 2024 for Canada plus Colombia and Ecuador actual average WI production, in each case, for the fourth quarter of 2024. The total production rate was 46,619 BOEPD.

Future Development Costs

FDC reflects McDaniel’s best estimate of what it will cost to bring the Proved Undeveloped and Probable Undeveloped reserves on production. Changes in forecast FDC occur annually as a result of development activities, acquisition and disposition activities, and changes in capital cost estimates based on improvements in well design and performance, as well as changes in service costs. FDC for 2P reserves increased to $1,809 million at year-end 2024 from $923 million at year-end 2023. The increase in FDC in 2024 was predominantly attributed to the acquisition of i3 Energy plc in 2024.

*In all cases, the FD&A number is calculated by dividing the identified capital expenditures by the applicable reserves additions both before and after changes in FDC costs. Both FD&A costs take into account reserves revisions during the year on a per boe basis. The aggregate of the exploration and development costs incurred in the financial year and the changes during that year in estimated future development costs may not reflect the total FD&A costs related to reserves additions for that year.

Forecast Prices

The pricing assumptions used in estimating NI 51-101 and COGEH compliant reserves data disclosed above with respect to net present values of future net revenue are set forth below. The price forecasts are based on an average of three independent qualified reserves evaluators’ commodity price forecasts at January 1, 2025 (McDaniel, Sproule and GLJ). All three of these companies are independent qualified reserves evaluators and auditors pursuant to NI 51-101.

About Gran Tierra Energy Inc.

Non-GAAP Measures

This press release includes non-GAAP measures which do not have a standardized meaning under GAAP. Investors are cautioned that these measures should not be construed as alternatives to oil and natural gas sales, net income or loss or other measures of financial performance as determined in accordance with GAAP. Gran Tierra’s method of calculating these measures may differ from other companies and, accordingly, they may not be comparable to similar measures used by other companies.

Net Debt as presented as at December 31, 2024 is comprised of $787 million (gross) of senior notes outstanding less cash and cash equivalents of $104 million, prepared in accordance with GAAP. Management believes that Net Debt is a useful supplemental measure for management and investors to in order to evaluate the financial sustainability of the Company’s business and leverage. The most directly comparable GAAP measure is total debt.

Unaudited Financial Information

Certain financial and operating results included in this press release, including debt, cash equivalents, capital expenditures, and production information, are based on unaudited estimated results. These estimated results are subject to change upon completion of the Company’s audited financial statements for the year ended December 31, 2024, and changes could be material. Gran Tierra anticipates filing its audited financial statements and related management’s discussion and analysis for the year ended December 31, 2024 on or before February 26, 2025.

DISCLOSURE OF OIL AND GAS INFORMATION

All reserves values, future net revenue and ancillary information contained in this press release have been prepared by McDaniel and are derived from the GTE McDaniel Reserves Report, unless otherwise expressly stated. Any reserves values or related information contained in this press release as of a date other than December 31, 2024 has an effective date of December 31 of the applicable year and is derived from a report prepared by Gran Tierra’s independent qualified reserves evaluator as of such date, and additional information regarding such estimate or information can be found in Gran Tierra’s applicable Statement of Reserves Data and Other Oil and Gas Information on Form 51-101F1 filed on SEDAR at www.sedar.com.

Estimates of net present value and future net revenue contained herein do not necessarily represent fair market value. Estimates of reserves and future net revenue for individual properties may not reflect the same level of confidence as estimates of reserves and future net revenue for all properties, due to the effect of aggregation. There is no assurance that the forecast price and cost assumptions applied by McDaniel in evaluating Gran Tierra’s reserves and future net revenue will be attained and variances could be material.

All evaluations of future net revenue contained in the GTE McDaniel Reserves Report are after the deduction of royalties, operating costs, development costs, production costs and abandonment and reclamation costs but before consideration of indirect costs such as administrative, overhead and other miscellaneous expenses. It should not be assumed that the estimates of future net revenues presented in this press release represent the fair market value of the reserves. There are numerous uncertainties inherent in estimating quantities of crude oil reserves and the future cash flows attributed to such reserves. The reserve and associated cash flow information set forth in the GTE McDaniel Reserves Report are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual reserves may be greater than or less than the estimates provided therein.

References to a formation where evidence of hydrocarbons has been encountered is not necessarily an indicator that hydrocarbons will be recoverable in commercial quantities or in any estimated volume. Gran Tierra's reported production is a mix of light crude oil and medium, heavy crude oil, tight oil, conventional natural gas, shale gas and natural gas liquids for which there is no precise breakdown since the Company’s sales volumes typically represent blends of more than one product type. Drilling locations disclosed herein are derived from the GTE McDaniel Reserves Report and account for drilling locations that have associated Proved Undeveloped and Proved plus Probable Undeveloped reserves, as applicable. Well test results should be considered as preliminary and not necessarily indicative of long-term performance or of ultimate recovery. Well log interpretations indicating oil and gas accumulations are not necessarily indicative of future production or ultimate recovery. If it is indicated that a pressure transient analysis or well-test interpretation has not been carried out, any data disclosed in that respect should be considered preliminary until such analysis has been completed. References to thickness of “oil pay” or of a formation where evidence of hydrocarbons has been encountered is not necessarily an indicator that hydrocarbons will be recoverable in commercial quantities or in any estimated volume.

Definitions

Oil and Gas Metrics

This press release contains a number of oil and gas metrics, including NAV per share, FD&A costs, reserve life index and reserves replacement, which do not have standardized meanings or standard methods of calculation and therefore such measures may not be comparable to similar measures used by other companies and should not be used to make comparisons. Such metrics have been included herein to provide readers with additional measures to evaluate the Company’s performance; however, such measures are not reliable indicators of the future performance of the Company and future performance may not compare to the performance in previous periods.

NAV per share is calculated as NPV10 (before or after tax, as applicable) of the applicable reserves category minus estimated Net Debt, divided by the number of shares of Gran Tierra’s common stock issued and outstanding. Management uses NAV per share as a measure of the relative change of Gran Tierra’s net asset value over its outstanding common stock over a period of time.

FD&A costs are calculated as estimated exploration and development capital expenditures, including acquisitions and dispositions, divided by the applicable reserves additions both before and after changes in FDC costs. The calculation of FD&A costs incorporates the change in FDC required to bring proved undeveloped and developed reserves into production. The aggregate of the exploration and development costs incurred in the financial year and the changes during that year in estimated FDC may not reflect the total FD&A costs related to reserves additions for that year. Management uses FD&A costs per boe as a measure of its ability to execute its capital program and of its asset quality.

Reserve life index is calculated as reserves in the referenced category divided by the referenced estimated production. Management uses this measure to determine how long the booked reserves will last at current production rates if no further reserves were added.

Reserves replacement is calculated as reserves in the referenced category divided by estimated referenced production. Management uses this measure to determine the relative change of its reserve base over a period of time.

Disclosure of Reserve Information and Cautionary Note to U.S. Investors

Proved reserves are reserves which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible from a given date forward from known reservoirs under existing economic conditions, operating methods, and government regulations prior to the time at which contracts providing the right to operate expires, unless evidence indicates that renewal is reasonably certain. Probable reserves are reserves that are less certain to be recovered than proved reserves but which, together with proved reserves, are as likely as not to be recovered. Estimates of probable reserves which may potentially be recoverable through additional drilling or recovery techniques are by nature more uncertain than estimates of proved reserves and accordingly are subject to substantially greater risk of not actually being realized by us. Possible reserves are reserves that are less certain to be recovered than probable reserves. Estimates of possible reserves are also inherently imprecise. Estimates of probable and possible reserves are also continually subject to revisions based on production history, results of additional exploration and development, price changes, and other factors.

Investors are urged to consider closely the disclosures and risk factors in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and in the other reports and filings with the SEC, available from the Company’s offices or website. These reports can also be obtained from the SEC website at www.sec.gov.