CALGARY, ALBERTA--(Marketwired - Feb. 6, 2017) - Gran Tierra Energy Inc. ("Gran Tierra" or the "Company") (NYSE MKT:GTE)(TSX:GTE), a company focused on oil and gas exploration and production in Colombia, is pleased to announce that a purchase and sale agreement (the "Agreement") was executed pursuant to which Maha Energy AB ("Maha") has agreed to purchase Gran Tierra's Brazil business unit through the acquisition of all of the equity interests in one of Gran Tierra's indirect subsidiaries, and the assignment of certain debt owed by the corporate entities comprising Gran Tierra's Brazil business unit to the Gran Tierra group of companies (the "Brazil Divestiture").
Upon completion of the Brazil Divestiture, Maha will acquire all of Gran Tierra's assets in Brazil, including its 100% working interest in the Tiê Field and all of Gran Tierra's interest in exploration rights and obligations held pursuant to concession agreements granted by the Agência Nacional do Petróleo, Gás Natural e Biocombustíveis of Brazil ("ANP").
The completion of the Brazil Divesture is subject to Maha obtaining financing, as well as customary closing conditions, including the receipt of required regulatory approval from the ANP. The consideration to be received by Gran Tierra on the completion of the Brazil divestiture is US$35 million, subject to adjustments, plus the assumption by Maha of certain existing and potential liabilities of Gran Tierra's Brazil business unit. Pursuant to the Agreement, Maha will pay a deposit US$3.5 million by February 9, 2017, which is not refundable in the event Maha is not successful in obtaining financing to complete the Brazil Divestiture.
As previously disclosed, the Company's assets in Brazil are not considered core to Gran Tierra's Colombia growth strategy, and we believe this divestiture allows Gran Tierra a significant advantage by reallocating resources (people and money) to our core Colombian exploration, development and production operations.
The economic effective date of the transaction will be on or before August 1, 2017, and Gran Tierra will continue to operate its Brazil business unit until the completion of the Brazil Divestiture.
About Gran Tierra Energy Inc.
Gran Tierra Energy Inc. is an international oil and gas exploration and production company, headquartered in Calgary, Canada, incorporated in the United States, trading on the NYSE MKT (GTE) and the Toronto Stock Exchange (GTE), and operating in South America. Gran Tierra holds interests in producing and prospective properties in Colombia, Peru, and Brazil. Gran Tierra has a strategy that focuses on establishing a portfolio of producing properties, plus production enhancement and exploration opportunities to provide a base for future growth. Additional information concerning Gran Tierra is available at www.grantierra.com. Investor inquiries may be directed to [email protected] or (403) 265-3221.
Gran Tierra's Securities and Exchange Commission filings are available on a website maintained by the Securities and Exchange Commission at http://www.sec.gov and on SEDAR at http://www.sedar.com.
Forward Looking Statements and Legal Advisories:
This press release contains opinions, forecasts, projections, and other statements about future events or results that constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and financial outlook and forward looking information within the meaning of applicable Canadian securities laws (collectively, "forward-looking statements"). The use of the words "will" and "believes", derivations thereof and similar terms identify forward-looking statements. In particular, but without limiting the foregoing, this news release contains forward-looking statements regarding: our ability to complete the Brazil Divestiture, the ability of Maha to raise the remainder of the funds required to complete the Brazil Divestiture; the anticipated benefits of the transaction to Gran Tierra Energy and its shareholders and the anticipated receipt of approvals for the Brazil Divestiture.
The forward-looking statements contained in this news release are based on certain assumptions made by Gran Tierra based on management's experience and other factors believed to be appropriate. Gran Tierra Energy believes these assumptions to be reasonable at this time, but the forward-looking statements are subject to risk and uncertainties, many of which are beyond Gran Tierra's control, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include the factors discussed or referenced in Gran Tierra's reports filed with the Securities and Exchange Commission, including, without limitation, under the caption "Risk Factors" in Gran Tierra's Annual Report on Form 10-K filed February 29, 2016 and its subsequently filed Quarterly Reports on Form 10-Q. These filings are available on a Web site maintained by the Securities and Exchange Commission at http://www.sec.gov and on SEDAR at www.sedar.com.
All forward-looking statements are made as of the date of this press release and the fact that this press release remains available does not constitute a representation by Gran Tierra that Gran Tierra believes these forward-looking statements continue to be true as of any subsequent date. Actual results may vary materially from the expected results expressed in forward-looking statements. Gran Tierra disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities laws. Gran Tierra's forward-looking statements are expressly qualified in their entirety by this cautionary statement.
Chief Executive Officer
Chief Financial Officer
Vice President, Investor Relations