GeoPark Holdings Limited announced the completion of its second acquisition in Colombia this year with the purchase of Hupecol Cuerva LLC ("Hupecol") for a total consideration of $75 million cash, adjusted for working capital.
The assets acquired from Hupecol comprise the La Cuerva and Llanos 62 blocks (approximately 90,000 acres) in the Llanos basin in Colombia - both operated and owned with 100% working interests.
GeoPark will fund this acquisition from its existing cash resources. In the twelve months to December 31, 2011, the Hupecol assets generated revenues of approximately $68 million, EBITDA of approximately $30 million and net income of approximately $21 million.
Strengthens Strategic Platform
The Hupecol assets complement GeoPark's recent acquisition of Winchester Oil and Gas and La Luna Companies ("Winchester Luna") in Colombia announced in February 2012 and create a solid growth platform in Colombia with a balanced mix of production, development and exploration assets. The combined Hupecol and Winchester Luna purchases (acquired for a total consideration of $105 million plus certain possible contingent payments) provide GeoPark with the following in Colombia:
GeoPark is the first private Latin American company with oil and gas production in Chile, Colombia and Argentina combined. In addition to its assets in Colombia, GeoPark currently operates 9 blocks in Chile and Argentina (approximately 3.9 million gross acres) with current oil and gas production of approximately 9,500 barrels of oil equivalent per day (boepd). GeoPark's 2012 work program of $100-120 million in Chile includes the drilling of 17-20 wells and the completion of 232 square miles (600 square kilometers) of 3D and 91 miles (147 kilometers) of 2D seismic surveys.
Commenting, James F. Park, CEO of GeoPark, said, "The acquisition of the Hupecol La Cuerva and Llanos 62 blocks confirms our commitment to grow in Colombia. Our new Colombian portfolio of 10 blocks represents an attractive and balanced platform with secure low risk producing and development assets and higher risk higher potential exploration assets. The active ongoing work and investment programs also provide GeoPark the opportunity to immediately build additional value through the drill bit. Furthermore, we believe our entry into Colombia has been well-timed - now a region with exciting consolidation opportunities. The addition of Colombia to our Chilean and Argentinean assets is expected to make a significant impact to GeoPark's key performance indicators in 2012."
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