GeoPark Takes Major Step in Vaca Muerta
GeoPark Limited (NYSE: GPRK), a prominent independent energy entity with over two decades of successful operations in Latin America, proudly announces its new venture into the Vaca Muerta formation. This ambitious acquisition involves a complete operated working interest in the Loma Jarillosa Este and Puesto Silva Oeste blocks, recognized for their black oil potential.
Agreement with Pluspetrol and Government Collaboration
In tandem with its acquisition from Pluspetrol S.A., GeoPark has formalized commitments with the Government of Neuquen Province through two Deeds of Agreement. These agreements ensure the cooperation of both parties and detail the agreed-upon terms for the transfer of concessions.
Strategic Position in a Prolific Oil Play
This strategic acquisition aligns perfectly with GeoPark's goal of establishing a foothold in Vaca Muerta, an internationally recognized unconventional oil and gas resource. As a certified unconventional operator, GeoPark is set to play a vital role in the regional operational ecosystem, driving growth initiatives and operational efficiencies.
Key Benefits of the Acquisition
- Scale and Longevity: The acquisition covers over 12,300 gross acres in the Vaca Muerta black oil area, boasting an estimated recoverable resource exceeding 60 million barrels of oil. This concession comes with a long-term duration, extending for over 30 years, and contributes significantly to the company's total production, expected to reach around 30,000 boepd by 2025.
- Growth Trajectory: With clear pathways toward plateau production estimated at approximately 20,000 boepd by the end of 2028, the acquired blocks also carry considerable reserves and resources, providing ample room for growth.
- Value Accretion: This acquisition is predicted to yield an incremental pro-forma Adjusted EBITDA between $12 and $14 million for full-year 2025, with potential to contribute gross Adjusted EBITDA of $300 to $350 million at a $70/bbl Brent oil price.
Looking to the Future
Expected to be finalized before the end of 2025, the closing of this transaction is contingent upon regulatory approval from the Neuquen Province, following which GeoPark will continue to collaborate closely with all involved parties to ensure a smooth transition.
CEO's Vision for Sustainable Growth
Felipe Bayon, CEO of GeoPark, expressed his enthusiasm about this transformative agreement, highlighting how it marks a significant milestone in the company’s journey. He emphasized the fact that this move is not just about immediate production but a long-term commitment to create sustainable value.
Highlights of the New Operations
- Production and Infrastructure Plans: Current production from the blocks stands at 1,700–2,000 boepd (95% oil and 5% gas). Future expansion includes a comprehensive development plan with potential new wells and a new communications infrastructure to support growing production needs.
- Financial Outlook: The acquisition positions GeoPark for substantial EBITDA contributions and is set to enhance the company’s financial profile, with a keen approach towards managing investments while maximizing returns.
Frequently Asked Questions
What are the main components of GeoPark's acquisition in Vaca Muerta?
The acquisition includes full operational control of the Loma Jarillosa Este and Puesto Silva Oeste blocks, covering over 12,300 gross acres, estimated to hold significant recoverable oil resources.
When is the expected completion date for the acquisition?
The transaction is anticipated to close before the end of 2025, pending the necessary regulatory approvals.
How does this acquisition benefit GeoPark financially?
This move is expected to add an incremental Adjusted EBITDA of $12 to $14 million for 2025, with long-term projections estimating significant contributions at peak production levels.
What are GeoPark's production goals for the acquired blocks?
GeoPark aims to reach production levels of approximately 20,000 boepd by the end of 2028, significantly increasing its operational capabilities.
Who can be contacted for more information about the acquisition?
For investor inquiries, contact Maria Catalina Escobar at mescobar@geo-park.com, or reach out to the Investor Relations team at GeoPark for more details.
