Gran Tierra to Acquire Petrolifera

Gran Tierra Energy has entered into an Arrangement Agreement to acquire all the issued and outstanding shares and warrants of Petrolifera pursuant to a plan of arrangement. Under the terms of the Agreement, Petrolifera shareholders will receive 0.1241 of a share of Gran Tierra Energy, for every Petrolifera share held. A total of approximately 19 million Gran Tierra Energy shares are expected to be issued, which represents approximately an 8% increase in shares outstanding. Total consideration for the transaction is approximately US $195 million including the assumption of Petrolifera's debt, working capital and investments as of September 30, 2010. Petrolifera's Board of Directors has unanimously approved the Arrangement and the Arrangement Agreement and has determined that the Arrangement is in the best interest of Petrolifera shareholders and warrant holders and recommends that Petrolifera shareholders vote in favor of the Arrangement.

All of the directors and officers of Petrolifera, together with Petrolifera's largest shareholder, representing, in aggregate, 21% of Petrolifera's issued and outstanding shares, have entered into agreements with Gran Tierra Energy to vote in favour of and otherwise support the Arrangement, subject to customary exceptions. A break fee consisting of 4% of the enterprise value of the transaction will be payable by Petrolifera in certain circumstances.

"This transaction will add substantial assets featuring both high working interest and operatorship which complement our current assets in three of the four South American countries in which we operate," said Dana Coffield, President and Chief Executive Officer of Gran Tierra Energy. "The transaction is expected to be accretive to Gran Tierra Energy's shareholders in terms of reserves and production per share. It will add undeveloped oil and gas reserve potential in Colombia, exploration opportunities in Colombia and Peru and additional oil production and reserves in a rising oil price environment in Argentina. Upon closing of the Arrangement, Gran Tierra Energy will retain its strong balance sheet and cash position to be used in the development of the assets acquired in this transaction. The successful completion of the Arrangement will enable Petrolifera's shareholders to participate in the exciting future growth potential of Gran Tierra Energy."