Gran Tierra Energy (GTE)

[dan_s]

GTE is going to be ramping up production in Columbia this year. 2014 growth will be coming primarily from development of their Moqueta Field.

The Bretaña field in Peru layers on significant growth potential in the future. As I reported in my 11/27/2013 profile on the company, which you can find under the Sweet 16 Tab, the Bretaña Norte exploration well on Block 95 in Peru was a major discovery for the company. The market just didn't pick up on it. Now 3rd party engineers have confirmed the find. The pre-tax NPV10 of the 2P reserves (Securities and Exchange Commission ("SEC") compliant) is approximately $624 million, while the pre-tax NPV10 of the 3P reserves (SEC compliant) is approximately $1.495 billion.

My Fair Value Estimate for GTE is $11.65/share compared to First Call's Price Target of $9.59/share. I think the First Call valuation will be going up after they see the full year-end reserve report. GTE sells all of their oil under contracts tied to Brent.
--------------------------------------------------------------------------------------------

CALGARY, Jan. 21, 2014 /PRNewswire/ - Gran Tierra Energy Inc. ("Gran Tierra Energy") (NYSE MKT: GTE) (GTE.TO), a company focused on oil exploration and production in South America, today announced the results of a qualified independent reserve evaluation of the company's Peru reserves by GLJ Petroleum Consultants Ltd. ("GLJ") effective December 31, 2013.

"Gran Tierra Energy has successfully booked significant reserves at the Bretaña field in Peru. On a proved plus probable ("2P") and proved plus probable plus possible ("3P") basis, the Bretaña field reserves nearly double the total corporate 2P and 3P reserves booked at year-end 2012. We are currently planning on initiating long-term test production from this field beginning in September 2014, with an appraisal well planned to be drilled in the fourth quarter of this year in the southern portion of the Bretaña field," said Dana Coffield, President and Chief Executive Officer of Gran Tierra Energy. "Furthermore, additional unbooked resource potential has been identified in an extension of the Bretaña structure on recently acquired and interpreted 2D seismic. This discovery is a dramatic reserve addition for Gran Tierra Energy, building on our substantial historical success in Colombia, and is expected to provide significant growth for Gran Tierra Energy and assist Perupetro in achieving its objective to bring new oil to the market on behalf of the Government of Peru in the coming decade," concluded Coffield.