Gran Tierra Energy Inc. announced an increase in its capital budget for 2011 as the result of a recent acquisition of oil and gas properties in South America.
In January 2011, Gran Tierra Energy signed an agreement to acquire Petrolifera Petroleum Limited, an exploration and production company focused on operations in Argentina, Colombia and Peru. The company paid consideration of $195 million, including the assumption of debt.
Gran Tierra Energy allocated an additional $55 million in capital spending in 2011, bringing the companywide total to $354 million. The company will distribute this additional capital across various properties, with 90% of the funds scheduled to be spent on drilling and completion costs.
Gran Tierra Energy will spend $25 million in Colombia in 2011, and plans to conduct exploration activities in the Lower Magdalena Basin, which the company feels is prospective for natural gas.
Gran Tierra Energy will spend $14 million in Peru in 2011, and is focused on Block 107. The company plans to use the balance of 2011 evaluating the property, with the first well planned for 2012.
Gran Tierra Energy has allocated $16 million for Argentina in 2011. The company is active in the Neuquen Basin, and plans to use the funds to arrest the production declines from wells on this property.
For more information on the company, go to www.grantierra.com