Gran Tierra Energy Inc. press release

Gran Tierra Energy Inc. Reports Second Quarter 2026 Results

2026-08-05

NYSE - New York Stock Exchange · Oil · Natural Gas · Natural Gas Liquids · Canada · Corporate Finance

_Achieved Total Company Average Second Quarter Production of __41,501__BOEPD__1 _ _Net Income of __$25__Million_, _Adjusted EBITDA__2__of __$85__Million and Positive Free Cash Flow _ Announcement of Prospective and Contingent Resource Report on Dawson Clearwater and Mount Head Areas in Canada Completed Suroriente Capital Carry Improving Profitability of the Block _Announcement of the Disposition of Lodgepole Assets for __C$12.8__Million_ Satisfied the Conditions Precedent for Tisquirama Contract Providing Further Growth Potential in Colombia

CALGARY, Alberta, Aug. 05, 2026 (GLOBE NEWSWIRE) -- Gran Tierra Energy Inc.(“Gran Tierra” or the “Company”) (NYSE American:GTE) (TSX:GTE) (LSE:GTE)announced the Company’s financial and operating results for the quarter ended June 30, 2026 (the“Quarter”). All dollar amounts are in United States (“U.S.”) dollars and all reserves and production volumes are on an average working interest (“WI”) before royalties basis unless otherwise indicated. Production is expressed in barrels (“bbl”) of oil equivalent (“boe”) per day (“boepd” or“boe/d”) and are based on WI sales before royalties. For per boe amounts based on net after royalty (“NAR”) production, see Gran Tierra’s Quarterly Report on Form 10-Q filed August 4, 2026.

Message to Shareholders

Gary Guidry, President and Chief Executive Officer of Gran Tierra, commented: “Our second quarter results benefited from a stronger commodity price environment, reduced total operating costs and the continued strength of our portfolio, with production within our guidance range and improved margins and cash generation across the business. During the Quarter, we advanced several priorities that make our portfolio more durable. We completed our capital carry at Suroriente, improving the profitability on the block and satisfied the conditions precedent for the Tisquirama contract, adding another growth opportunity in Colombia. In Ecuador, we received additional field development plan approvals and are transitioning from exploration into development. In Canada, we continued to optimize the portfolio with the sale of our Lodgepole assets and sharpened our focus on the resource potential in the Dawson Clearwater and Mount Head areas. The resource report disclosed in this release speaks to the scale of that opportunity, and Dawson Clearwater and Mount Head will be a focus of our drilling activity in 2027. Looking ahead, our priorities remain unchanged. We will allocate capital with discipline, operate our fields safely and reliably, and continue to strengthen our balance sheet, generate free cash flow and build long-term value for our shareholders.”

Dawson Clearwater and Mount Head Resource Report:

McDaniel, effective June 30, 2026, assigned Gran Tierra unrisked best estimate contingent resources (2C) of approximately 6.5 MMbbl at Dawson Clearwater, and unrisked best-estimate prospective resources (P50) of approximately 55 MMbbl at Dawson Clearwater and 12 MMbbl at Mount Head. Combined, this represents approximately 67 MMbbl of unrisked best-estimate prospective resources. On a mean basis, unrisked prospective resources are approximately 72 MMbbl and risked mean prospective resources are approximately 33 MMbbl. Gran Tierra operates both plays and holds a 100% working interest at Dawson Clearwater and Mount Head. The Company holds approximately 139 net sections in the Clearwater area and 30 net sections at Mount Head, roughly 108,000 net acres in total. McDaniel's Clearwater estimates cover only the 41 net sections at Dawson and Seal. The remaining Clearwater acreage carries no assigned resources at this time. Shallow depths and horizontal multilateral drilling give the Clearwater low drilling and completion costs relative to other Western Canadian oil plays. Mount Head targets 37 to 41 degree API light oil, diversifying Gran Tierra's production mix and realized pricing beyond its South American crude. Both plays are suited to waterflood, allowing Gran Tierra to apply the secondary recovery expertise developed across its Colombian fields.

Key Highlights of the Quarter:

Production: Gran Tierra’s total average WI production was 41,501 boepd, which was 9% lower than first quarter of 2026 (the“Prior Quarter”) and 12% lower than the second quarter of 2025. The decrease in production when compared to the second quarter of 2025 is attributable to lower production in Colombia and the sale of Simonette and Lodgepole assets in Canada, partially offset by higher than anticipated production results from Conejo-1 well and additional production from the Perico Block in Ecuador acquired in December 2025. The decrease in production when compared to the Prior Quarter is primarily attributable to the sale of Simonette and Lodgepole assets and lower production levels in the Acordionero and Cohembi fields resulting from the temporary unplanned failure of artificial lift systems which have been rectified. Net Income: Gran Tierra generated net income of $25 million or $0.70 per share3, basic and diluted, compared to a net loss of $119 million in the Prior Quarter and a net loss of $13 million or $0.36 per share3basic and diluted in the second quarter of 2025. Gross Profit4: The Company’s gross profit4was approximately $75 million for the Quarter, which was up from approximately $37 million for the Prior Quarter and up from $23 million in the second quarter of 2025. On a per boe basis, our gross profit4for the Quarter was $19.90, up from $8.49 in the Prior Quarter and up from $5.60 in the second quarter of 2025. Operating Netback2:The Company’s operating netback2was $34.73 per boe, up 49% from the Prior Quarter and up 62% from the second quarter of 2025, primarily as a result of higher oil prices recognized during the Quarter. Adjusted EBITDA2:Adjusted EBITDA2was $85 million compared to $74 million in the Prior Quarter and $77 million in the second quarter of 2025. Twelve-month trailing net debt(2)(5)to Adjusted EBITDA2was 1.7 times and the Company continues to have a long-term target ratio of 1.0 times. Net Cash Provided by Operating Activities: Net Cash Provided by Operating Activities was $57 million ($1.62 per share3), down 67% from the Prior Quarter and up 66% from the second quarter of 2025. Funds Flow from Operations2: Funds flow from operations2was $60 million ($1.70 per share3), up 41% from the Prior Quarter and up 12% from the second quarter of 2025. Cash and Debt:As of June 30, 2026, the Company had a cash balance of $127 million, total gross debt of $606 million and net debt(2)(5)of $479 million. During the six months ended June 30, 2026, Gran Tierra repurchased $9.2 million in face value of the Company’s 9.75% Senior Notes due April 15, 2031 at a discount of 12% to the face value of the repurchased bonds. Subsequent to the Quarter, the Company repurchased an additional $15.0 million of 9.75% Senior Notes due April 15, 2031 at a discount of 10% to the face value of the repurchased bonds. Liquidity: In addition to the $127 million cash on hand as of June 30, 2026, the Company currently has approximately $53 million in undrawn availability from its credit and lending facilities. Hedging: The Company hedges a portion of production to protect a base level of cash flow while keeping upside to higher prices. For the second half of 2026, oil hedged is roughly 16,000 barrels per day (“bbl/d”), about 52% of oil production, with floors near US$60 per bbl. During the Quarter, the Company bought back the ceilings on 5,000 bbl/d of its three-way collars, and more than 66% of total oil production remains uncapped and fully exposed to stronger prices. On gas, approximately 20,000 gigajoules (“GJ”) per day are fixed at C$2.71 per GJ through September 2026, and approximately 6,700 GJ per day are fixed at the same price for the fourth quarter of 2026. Both are above the Q2 2026 AECO average of C$1.55 per GJ.

Operational Update:

Colombia Completion of Suroriente Carry: During the Quarter, Gran Tierra completed its $123.0 million capital carry commitment under the Suroriente joint venture with Ecopetrol S.A. (the “Suroriente Carry”). The post-Suroriente Carry period commenced on July 18, 2026, improving the economics and the overall profitability of the block. Cohembi Drilling Program Completed: Gran Tierra completed the six-well development drilling program at the Cohembi field in the Putumayo Basin, with the final two wells drilled and brought on production during the Quarter. The program fulfilled the Company's drilling commitment under the Suroriente Carry and was delivered under budget.

Ecuador Field Development Plan (“FDP”) Approvals:Gran Tierra received government approval of three additional field development plans in June 2026 for Charapa, Conejo and Perico fields, bringing total approvals to five of the Company's six fields. With these approvals, Ecuador operations are transitioning from exploration to development. The Company was able to retain all acreage on the approved blocks and currently has ~156,000 acres of land for 20 years with an additional ~16,000 acres from Espejo currently pending FDP approval. Ecuador production averaged 7,993 bopd in the Quarter, supported by strong performance from Conejo discoveries and an earlier than expected response to water injection at Chanangue.

Sale of Lodgepole Assets

On June 23, 2026, the Company completed a disposition of 54% WI and associated title rights in the Lodgepole area effective January 1, 2026, for a total cash consideration of C$12.8 million (US$9.3 million). In addition to the cash, the Company derecognized asset retirement obligations attributed to the Lodgepole area totaling C$17.5 million (US$12.8 million) on an undiscounted basis and C$9.0 million (US$6.6 million) on a discounted basis. No gain or loss was recognized in the statement of operations as the disposal did not materially change the relationship between capital costs and the proved reserves of oil and natural gas assets.

Clearwater Asset Exchange

During the Quarter, we completed an asset exchange transaction in which we transferred a 30% working interest ("WI") in certain oil and natural gas rights, wells, and tangible assets located in the Marten Hills area, in exchange for oil and natural gas rights, wells, and tangible assets in the Seal/Dawson area, WI ranging from 35% to 100%. In connection with this transaction, we received cash consideration of C$0.8 million (US$0.6 million).

Completion of Conditions Precedent for Tisquirama Contract

During the Quarter, Gran Tierra satisfied all outstanding conditions precedent to the effectiveness of the contract previously announced on March 17, 2026, with Ecopetrol S.A., by which Gran Tierra will earn a 49% WI in the Tisquirama block in the Middle Magdalena Valley Basin of Colombia, which contains the Tisquirama and San Roque fields.

Additional Key Financial Metrics:

Capital Expenditures:Capital expenditures of $54 million were higher than the $45 million in the Prior Quarter and higher than the $51 million in the second quarter of 2025. During the Quarter, the Company completed the Suroriente Carry and the six-well development drilling program at the Cohembi field in the Putumayo Basin, with the final two wells drilled and brought on production during the Quarter. The Company’s 2026 capital program was planned to be weighted to the first half of the year and we expect capital expenditures to be within the previously stated guidance. Oil, Natural Gas, and Natural Gas Liquids (“NGL”) Sales: Gran Tierra generated sales of $187 million, up 25% from the second quarter of 2025 due to a 45% increase in Brent price, partially offset by a 16% decrease in sales volumes and higher quality and transportation discounts in Colombia associated with the use of alternative transportation routes for Putumayo production, as the Colombia and Ecuador border remained closed. These discounts had an impact of approximately $5.9 million for the Quarter and $10 million year to date in 2026. Sales increased 9% from the Prior Quarter primarily due to a 23% increase in Brent price and lower quality and transportation discounts in Colombia, and higher premiums in Ecuador, partially offset by a 20% decrease in sales volumes, primarily attributable to only one lifting in Ecuador compared to two in the Prior Quarter, and a 90% increase in royalties per boe as a result of higher benchmark oil prices and the sliding scale royalty regime in Colombia, Ecuador, and Canada. Free Cash Flow2: During the Quarter, the Company generated free cash flow2of approximately $6.0 million, an increase when compared to free cash flow2of $2.7 million generated in the second quarter of 2025, primarily due to a higher realized price during the Quarter. South American Quality and Transportation Discounts: The Company’s average quality and transportation discounts per bbl in South America during the Quarter increased to $10.31, comparable to $10.30 in the second quarter of 2025 and decreased compared to $14.85 in the Prior Quarter. The decrease from the Prior Quarter was primarily due to a decrease in Vasconia and Oriente differentials and lower transportation discounts. The Castilla oil differential per bbl was $9.71, up from $9.67 in the Prior Quarter and up from $4.73 in the second quarter of 2025 (Castilla is the benchmark for the Company’s Middle Magdalena Valley Basin oil production). The Vasconia differential per bbl was $1.42, down from $5.91 in the Prior Quarter and down from $1.71 in the second quarter of 2025. The Ecuadorian benchmark, Oriente, per bbl was $2.01, down from $8.17 in the Prior Quarter and down from $7.26 in the second quarter of 2025. During the Quarter, the Company had one lifting in Ecuador compared to two in the Prior Quarter. The Company sales price is the average Brent price less discounts for the month prior to lifting (M-1). The impact of the M-1 pricing of $101.89 per bbl increased revenue by approximately $4 million when compared to the average Brent price for the Quarter of $96.68 per bbl.

Operating Expenses:On a per boe basis, operating expenses increased by 2% when compared to the second quarter of 2025 primarily due to lower sales volume, partially offset by a decrease in total operating expenses. Total operating expenses decreased by 22% to $52 million compared to the Prior Quarter and decreased by 7% compared to the second quarter of 2025 primarily due to lower workover activities, reduced field personnel costs, lower oil treatment and testing service costs, and inventory fluctuations resulting from inventory accumulation at the end of the Quarter. Transportation Expenses: The Company’s transportation expenses decreased by 26% to $3.9 million, compared to transportation expenses of $5.3 million in the Prior Quarter, and decreased by 13% compared to transportation expenses of $4.5 million in the second quarter of 2025. Transportation expenses decreased when compared to the Prior Quarter and the second quarter of 2025 primarily due to lower sales volumes transported in Colombia and Canada and having one lifting completed in Ecuador compared to two in the Prior Quarter. General and Administrative (“G&A”) Expenses:G&A expenses before stock-based compensation were $3.49 per boe, a slight decrease from $3.51 per boe in the Prior Quarter primarily due to lower consulting costs, lower information technology costs, and lower salaries associated with headcount optimization. G&A expenses before stock-based compensation during the Quarter increased from $3.40 per boe in the second quarter of 2025 primarily due to lower sales volumes. Cash Netback2: Cash netback2per boe increased to $15.90 during the Quarter, a 60% increase from the Prior Quarter and a 23% increase from the second quarter of 2025, primarily due to a higher operating netback2as a result of a higher realized price during the Quarter.

Financial and Operational Highlights (all amounts in $000s, except per share and boe amounts)

| Consolidated Information | Three Months Ended June 30, | | Three Months Ended March 31, | | Six Months Ended June 30, | | | | | 2026 | 2025 | | 2026 | | 2026 | 2025 | | | | | | | | | | | Net Income (Loss) | $24,861 | $(12,741) | | $(119,172) | | $(94,311) | $(32,021) | | Per Share - Basic3 | $0.70 | $(0.36) | | $(3.38) | | $(2.67) | $(0.90) | | Per Share - Diluted3 | $0.70 | $(0.36) | | $(3.38) | | $(2.67) | $(0.90) | | | | | | | | | | | Gross Profit4 | $75,460 | $23,313 | | $36,697 | | $112,157 | $51,414 | | Depletion and Accretion6 | $56,253 | $65,948 | | $63,908 | | $120,161 | $134,379 | | Operating Netback2 | $131,713 | $89,261 | | $100,605 | | $232,318 | $185,793 | | | | | | | | | | | Oil, Natural Gas and NGL Sales | $187,181 | $149,357 | | $172,057 | | $359,238 | $317,530 | | Operating Expenses | (51,561) | (55,602) | | (66,149) | | (117,710) | (122,692) | | Transportation Expenses | (3,907) | (4,494) | | (5,303) | | (9,210) | (9,045) | | Operating Netback2 | $131,713 | $89,261 | | $100,605 | | $232,318 | $185,793 | | | | | | | | | | | G&A Expenses Before Stock-Based Compensation | $13,219 | $14,136 | | $15,149 | | $28,368 | $26,062 | | G&A Stock-Based Compensation (Recovery) Expense | (3,757) | 546 | | 19,676 | | 15,919 | 29 | | G&A Expenses, Including Stock Based Compensation | $9,462 | $14,682 | | $34,825 | | $44,287 | $26,091 | | | | | | | | | | | EBITDA2 | $132,156 | $84,908 | | $(26,015) | | $106,141 | $164,618 | | | | | | | | | | | Adjusted EBITDA2 | $85,071 | $76,987 | | $73,935 | | $159,006 | $162,149 | | | | | | | | | | | Net Cash Provided by Operating Activities | $57,414 | $34,677 | | $172,734 | | $230,148 | $107,907 | | | | | | | | | | | Funds Flow from Operations2 | $60,289 | $53,906 | | $42,823 | | $103,112 | $109,250 | | | | | | | | | | | Capital Expenditures (Before Changes in Working Capital) | $54,309 | $51,170 | | $45,359 | | $99,668 | $145,897 | | | | | | | | | | | Free Cash Flow2 | $5,980 | $2,736 | | $(2,536) | | $3,444 | $(36,647) | | | | | | | | | | | Average Daily Production (boe/d) | | | | | | | | | WI Production Before Royalties | 41,501 | 47,196 | | 45,497 | | 43,488 | 46,923 | | Royalties | (9,511) | (7,396) | | (7,756) | | (8,638) | (7,738) | | Production NAR | 31,990 | 39,800 | | 37,741 | | 34,850 | 39,185 | | Decrease (Increase) in Inventory | 176 | (1,469) | | 2,526 | | 1,345 | (509) | | Sales | 32,166 | 38,331 | | 40,267 | | 36,195 | 38,676 | | Royalties, % of WI Production Before Royalties | 23% | 16% | | 17% | | 20% | 16% | | | | | | | | | | | Cash Netback ($/boe)(2)(7) | | | | | | | | | Gross Profit(4)(7) | $19.90 | $5.60 | | $8.49 | | $13.82 | $6.12 | | Depletion and Accretion(6)(7) | $14.83 | $15.85 | | $14.79 | | $14.81 | $16.00 | | Operating Netback(2)(7) | $34.73 | $21.45 | | $23.28 | | $28.63 | $22.12 | | | | | | | | | | | Average Realized Price before Royalties | 63.94 | 42.82 | | 47.48 | | 54.84 | 45.36 | | Royalties | (14.59) | (6.93) | | (7.67) | | (10.57) | (7.56) | | Average Realized Price | 49.35 | 35.89 | | 39.81 | | 44.27 | 37.80 | | Transportation Expenses | (1.03) | (1.08) | | (1.23) | | (1.13) | (1.08) | | Average Realized Price Net of Transportation Expenses | 48.32 | 34.81 | | 38.58 | | 43.14 | 36.72 | | Operating Expenses | (13.59) | (13.36) | | (15.31) | | (14.51) | (14.60) | | Operating Netback(2)(7) | 34.73 | 21.45 | | 23.28 | | 28.63 | 22.12 | | Cash G&A Expenses | (3.49) | (3.40) | | (3.51) | | (3.50) | (3.10) | | Other Taxes | (0.37) | (0.14) | | (0.24) | | (0.30) | (0.13) | | Severance Expenses | (0.03) | — | | (0.57) | | (0.32) | — | | Realized Foreign Exchange Gain (Loss) | 0.07 | (0.14) | | (0.38) | | (0.17) | (0.33) | | Cash Settlement on Derivative Instruments | (8.97) | 0.39 | | (2.56) | | (5.56) | 0.25 | | Interest Expense, Excluding Amortization of Debt Issuance Costs, Non-Cash Interest, and Senior Notes Exchange Fees | (4.17) | (4.87) | | (4.90) | | (4.56) | (4.72) | | Interest Income | 0.13 | 0.06 | | 0.09 | | 0.11 | 0.08 | | Other Cash Gain | 0.43 | 0.09 | | 0.10 | | 0.25 | 0.04 | | Net Lease Payments | (0.03) | 0.04 | | (0.05) | | (0.04) | 0.04 | | Current Income Tax Expense | (2.40) | (0.53) | | (1.35) | | (1.84) | (1.25) | | Cash Netback(2)(7) | $15.90 | $12.95 | | $9.91 | | $12.70 | $12.99 | | | | | | | | | | | Share Information (000s) | | | | | | | | | Common Stock Outstanding, End of Period | 35,380 | 35,289 | | 35,346 | | 35,380 | 35,289 | | Weighted Average Number of Shares of Common Stock Outstanding - Basic | 35,369 | 35,335 | | 35,300 | | 35,334 | 35,555 | | Weighted Average Number of Shares of Common Stock Outstanding - Diluted | 35,369 | 35,335 | | 35,300 | | 35,334 | 35,555 |