GeoPark Limited has signed agreements to acquire upstream oil and gas assets in Colombia from Repsol for about $530 million. The acquisition includes a 45 percent stake in the CPO-9 Block and a 25 percent interest in SierraCol Energy Arauca LLC, producing approximately 16,000 barrels of oil equivalent per day. This move is in line with GeoPark’s growth strategy to enhance its asset portfolio in Latin America, along with its recent entry into onshore Argentina’s Vaca Muerta play.
GeoPark Limited, a prominent Latin American oil and gas company, has announced its decision to acquire upstream assets in Colombia from Repsol for a total consideration of approximately $530 million. The acquisition involves the purchase of 100 percent of Repsol Colombia O&G Limited, which holds a 45 percent non-operated working interest in the CPO-9 Block. This block, located in the Llanos Basin, is operated by Ecopetrol, which has a 55 percent interest.
The transaction also includes Repsol’s 25 percent stake in SierraCol Energy Arauca LLC, located in Llanos Norte, and is expected to enhance GeoPark’s production capabilities, bringing approximately 16,000 barrels of oil equivalent per day net from Repsol as reported in September. Due to the structure of the acquisition, it will be financed through a combination of cash resources and debt, including a non-recourse amortizing debt facility up to $345 million.
GeoPark believes this strategic acquisition aligns seamlessly with its ongoing growth strategy to build a sustainable and profitable portfolio in Latin America. By integrating Repsol’s assets, which offer an immediate production injection with substantial growth potential and exploration upside at a lower capital intensity, GeoPark aims to secure long-term cash flow and reserves. Moreover, this acquisition complements its recent ventures in the Vaca Muerta play in Argentina, providing it with diversification through enhanced asset capability across regions.
It is pertinent to note that the successful completion of this transaction is contingent upon meeting certain conditions, including regulatory approvals and the agreement of Repsol’s partners regarding preemptive rights. Furthermore, GeoPark has recently commenced production at the Confluencia Norte Block in Argentina and anticipates significant production advancements in the upcoming months as the development around the Vaca Muerta formation progresses.
As GeoPark continues to expand its operational reach and production capabilities across Latin America, these strategic movements not only fortify its market presence but also contribute positively to the regional oil and gas sector.
GeoPark Limited is a key player in the Latin American oil and gas industry, with a focus on developing and operating upstream assets across the region. The company’s strategy includes active expansion through acquisitions that enhance its resource base and production capacity. The Llanos Basin, where the acquired assets are situated, is one of Colombia’s most prolific oil-producing areas, making it a strategic target for companies seeking to bolster their oil and gas portfolios. Recently, GeoPark has made significant inroads into Argentina’s Vaca Muerta formation, known for its rich unconventional resources, underscoring its commitment to diversifying and strengthening its asset base in play and country risk.
In summary, GeoPark’s acquisition of upstream assets from Repsol in Colombia for approximately $530 million marks a strategic pivot designed to enhance its production capabilities, diversify its portfolio, and reinforce its presence in the Latin American oil and gas sector. The integration of these high-quality assets from the Llanos Basin aligns with GeoPark’s growth strategy, providing both immediate production benefits and long-term sustainable growth potential through exploratory opportunities. The successful execution of this deal is expected to bolster GeoPark’s operational framework moving forward.
Original Source: www.rigzone.com
