UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT
OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of October 2017
Commission File Number: 001-36298
GeoPark Limited
(Exact name of registrant as specified
in its charter)
Nuestra Señora de los Ángeles
179
Las Condes, Santiago, Chile
(Address
of principal executive office)
Indicate
by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
GEOPARK
LIMITED
TABLE
OF CONTENTS
ITEM
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1.
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Press Release dated October 12, 2017 titled
“GeoPark Announces Third Quarter 2017 Operational Update”
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Item
1
FOR IMMEDIATE DISTRIBUTION
GEOPARK ANNOUNCES THIRD QUARTER 2017
OPERATIONAL UPDATE
RECORD PRODUCTION, NEW OIL FIELD DISCOVERIES,
AND EXPANDED ACREAGE
Santiago,
Chile – October 12, 2017 - GeoPark Limited (“GeoPark” or the “Company”) (NYSE: GPRK), a leading
independent Latin American oil and gas explorer, operator and consolidator with operations and growth platforms in Colombia, Chile,
Brazil, Argentina, and Peru, today announced its operational update for the three-month period ended September 30, 2017 (“3Q2017”).
All figures
are expressed in US Dollars and growth comparisons refer to the same period of the prior year, except when otherwise specified.
Third Quarter
Highlights
Oil
and gas production up 28%
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·
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Consolidated
oil and gas production up 28% to 28,325 boepd (up 8% compared to 2Q2017)
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|
·
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Oil
production increased by 37% to 23,237 bopd (up 6% compared to 2Q2017)
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·
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Colombian
oil production increased by 43% to 22,301 (up 6% compared to 2Q2017)
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·
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Gas
production declined by 1% to 30.5 mmcfpd (up 21% compared to 2Q2017)
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·
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Current
production exceeds 29,000 boepd, with the year-end exit production goal of 30,000+ boepd
on target and average annual 2017 production close to the high end of the range, 26,500
– 27,500
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Colombia
drilling success drives gross production to over 50,000 bopd
In the
Llanos 34 block (GeoPark operated, 45% WI):
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·
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Curucucu
1 exploration well discovered new oil field, and currently producing 1,600 bopd
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·
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Jacana
12 appraisal well successfully drilled and currently producing 3,100 bopd
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·
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Tigana
Norte 2 development well successfully drilled and currently producing 2,000 bopd
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·
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Jacana
10 appraisal well successfully drilled and currently producing 900 bopd
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·
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Jacana
13 and 17 appraisal wells drilled and completed with testing planned in fourth quarter
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·
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New
wells drilled are currently producing more than 7,500 bopd gross
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Argentina
drilling success and new oil field discovery
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·
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CN-V
block (GeoPark operated, 50% WI): Rio Grande Oeste 1 exploration well discovered new
oil field. Initiating long-term test
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|
·
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Puelen
block (GeoPark non-operated, 18% WI): three shallow exploration wells drilled, with two
wells to be completed and tested in fourth quarter
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Brazil
acreage added to GeoPark’s high potential low cost Latin American asset platform
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·
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Bid
on and awarded a new attractive block in Brazil Round 14 in the proven mature onshore
Potiguar Basin that fits with other GeoPark properties
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·
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Total
commitment (bonus plus work program) of less than $500,000
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2020
Bond refinanced at lower cost, extended maturity and increased amount
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·
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Strengthened
balance sheet with successful placing of $425 million Bond under Regulation S and Rule
144 A, maturing in September 2024 with a 6.5% coupon
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·
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Funds
were used to repay substantially all existing financial debt, to provide financial flexibility
and for general corporate purposes
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·
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Offering
was oversubscribed by more than 4x with top tier and high-quality investors
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Catalysts
in 4Q2017
Colombia:
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·
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Continued
delineation of the expanding Tigana/Jacana complex with a focus in northern Tigana and
southern Jacana oil fields and delineate the area between Tigana and Jacana: two already-drilled
wells to be tested, two new appraisal wells to further test field boundaries, and two
new development wells to increase production
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Argentina:
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·
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Production
start-up with long-term testing in Rio Grande Oeste oil field in CN-V block
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·
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Exploration
drilling start-up in Sierra del Nevado block (GeoPark non-operated, 18% WI) in Neuquen
Basin
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Brazil:
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·
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Exploration
drilling in POT-T-747 block (GeoPark operated, 70% WI) in the Potiguar Basin
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New
hedges provide $50-$52/barrel oil price floor in 2018
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·
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Secured
minimum Brent price of $50/barrel and $52/barrel for 11,000 bopd and 8,000 bopd in 1Q2018
and 2Q2018, respectively
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|
·
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New
volumes complement existing hedged production of 12,000 bopd through December 2017 with
a minimum Brent price of $50-$51/barrel
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Breakdown
of Quarterly Production by Country
The following table shows production
figures for 3Q2017, as compared to 3Q2016:
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3Q2017
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3Q2016
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Total
(boepd)
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Oil
(bopd)
a
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Gas
(mcfpd)
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Total
(boepd)
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%
Chg.
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Colombia
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22,367
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22,301
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396
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15,678
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43%
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Chile
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2,817
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891
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11,556
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3,756
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-25%
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Brazil
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3,141
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45
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18,576
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2,636
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19%
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Total
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28,325
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23,237
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30,528
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22,070
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28%
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|
a)
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Includes
royalties paid in kind in Colombia for 774 bopd approximately in 3Q2017. No royalties
were paid in kind in either Chile or Brazil.
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Quarterly
Production Evolution
(boepd)
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3Q2016
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4Q2016
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1Q2017
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2Q2017
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3Q2017
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Colombia
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15,678
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17,535
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19,330
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21,015
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22,367
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Chile
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3,756
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3,523
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3,351
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2,450
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2,817
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Brazil
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2,636
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2,535
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2,499
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2,658
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3,141
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Total
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22,070
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23,593
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25,180
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26,123
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28,325
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Oil
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16,942
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18,798
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20,487
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21,930
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23,237
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Gas
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5,128
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4,795
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4,693
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4,193
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5,088
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Oil and Gas
Production Update
Consolidated:
Continued
significant oil production growth of 43% in Colombia increased average consolidated oil and gas production to 28,325 boepd in
3Q2017 from 22,070 boepd in 3Q2016. The increase was mainly attributed to new production from the Tigana/Jacana oil fields with
four new wells put into production plus the Curucucu oil field discovery. Production from Jacana 12 and Tigana Norte 2 wells were
only initiated in the second half of September. On a consolidated basis, gas production in Chile and Brazil increased by 22% compared
to the previous quarter.
Oil represented
82% of the total reported production in 3Q2017 (vs. 77% in 3Q2016 and 84% in 2Q2017) resulting from the successful drilling campaign
in the Llanos 34 block and a recuperated level of gas production in Chile and Brazil.
Colombia:
Average
net production in Colombia grew 43% to 22,367 boepd in 3Q2017 compared to 15,678 boepd in 3Q2016, primarily attributed to exploration,
appraisal and development drilling success in the Tigana/Jacana oil field complex in the Llanos 34 block, which represented 95%
of GeoPark’s Colombian production in 3Q2017.
The 3Q2017
drilling campaign in the Llanos 34 block continued to provide positive results, as follows:
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·
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Curucucu
1 exploration well was successfully drilled exploring a new fault trend to the east of
Tigana/Jacana fault trend, adjacent to the Jacamar oil field. The well is currently producing
1,600 bopd.
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|
·
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Jacana
12 appraisal well was drilled to a total depth of 11,508 feet. A production test conducted
with an electric submersible pump in the Guadalupe formation resulted in a production
rate of approximately 3,100 bopd of 15.8 degrees API, with less than 0.1% water cut,
through a choke of 64/64 inches and wellhead pressure of 45 pounds per square inch. Additional
production history is required to determine stabilized flow rates of the well. The Jacana
12 well was drilled to a bottom-hole location that is approximately 1,300 meters south
of the Jacana 11 appraisal well.
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|
·
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Tigana
Norte 2 was drilled to a total depth of 11,154 feet. A production test conducted with
an electric submersible pump in the Guadalupe formation resulted in a production rate
of 1,980 bopd of 14.7 degrees API, with less than 1.0% water cut, through a choke of
70/64 inches and wellhead pressure of 80 pounds per square inch. Additional production
history is required to determine the stabilized flow rates of the well.
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|
·
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Jacana
10 appraisal well was successfully drilled and completed to test the northern limits
of the Jacana oil field. The well is currently producing 900 bopd.
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·
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Jacana
13 and 17 appraisal wells were drilled and cased, and preliminary logging information
indicated the presence of hydrocarbons in the Guadalupe formation in both wells. The
wells are to be tested in the fourth quarter.
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For a summary
of upcoming drilling activities, please refer to the section 4Q2017 Drilling Schedule below.
Chile:
Average
net oil and gas production in Chile decreased by 25% to 2,817 boepd in 3Q2017 compared to 3,756 boepd in 3Q2016 due to the natural
decline in the fields. The resulting production mix during 3Q2017 was 68% gas and 32% oil (vs. 66% gas and 34% oil in 3Q2016).
The Fell block represented 98% of GeoPark’s Chilean production.
Uaken 1
exploration well was drilled to a total depth of 3,600 feet, targeting a gas prospect in El Salto formation in the Fell block
(GeoPark operated, 100% WI). Preliminary logging information indicates gas in the upper and lower zones of the formation. GeoPark
is currently seeking customary regulatory approvals to carry out testing activities, which are expected in the fourth quarter.
Brazil:
Average
net production in the Manati gas field (GeoPark non-operated, 10% WI) improved by 19% to 3,141 boepd in 3Q2017 compared to 2,636
boepd in 3Q2016. Industrial demand for gas in Brazil recovered in the third quarter resulting in increased production compared
to the second quarter.
GeoPark
was awarded a new attractive exploration block in Brazil bid Round 14. The POT-T-785 block covers an area of 7,875 acres in the
Potiguar Basin, surrounded by producing fields operated by Petrobras, where GeoPark’s technical team has identified three
leads. GeoPark committed to an investment of approximately $500,000, including bonus and work program commitments, during the
first exploration period ending December 2020. Potiguar is a mature proven basin that has undergone significant oil and gas activities
for the past 50 years with more than 70 oil and gas fields currently in production.
Argentina:
During
3Q2017 GeoPark announced the discovery of the Rio Grande Oeste oil field in CN-V block in the Neuquen Basin. Rio Grande Oeste
1 exploration well showed potential net pay of 400 feet and successfully tested 300 bopd gross. GeoPark constructed an early production
facility to begin production in a long-term test during the fourth quarter.
Also in
3Q2017, three exploration wells were drilled in Puelen block, with two of these expected to be completed and tested by the operator,
Pluspetrol, in the fourth quarter. New exploration drilling in Sierra del Nevado block (GeoPark non-operated, 18% WI) is also
expected in the fourth quarter.
The Puelen
and Sierra del Nevado blocks are in the Neuquen Basin. The Puelen block is located north of the producing El Corcobo oil field,
operated by Pluspetrol and the Sierra del Nevado block is located east of the Llancanelo oil field, operated by YPF.
4Q2017 Drilling
Schedule
The following
is a summary of expected activities scheduled for 4Q2017 with estimated total net capital expenditures of $20-30 million (drilling
and completion costs of $10-15 million plus facilities and other costs of $10-15 million).
|
Prospect/Well
a
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Country
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Block
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WI
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Type
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1
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Tigana Sur Oeste 3
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Colombia
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Llanos 34
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45%
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Development
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2
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Tigana Sur Oeste 7
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Colombia
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Llanos 34
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45%
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Appraisal
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3
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Jacana 13
b
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Colombia
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Llanos 34
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45%
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Appraisal
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4
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Jacana 17
b
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Colombia
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Llanos 34
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45%
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Appraisal
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5
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Tigana Norte 3
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Colombia
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Llanos 34
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45%
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Development
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6
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Tigana Norte 4
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Colombia
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Llanos 34
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45%
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Appraisal
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7
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Sierra del Nevado 1
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Argentina
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Sierra del
Nevado
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18% (Non-op)
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Exploration
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8
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Sierra del Nevado 2
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Argentina
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Sierra del
Nevado
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18% (Non-op)
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Exploration
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9
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Sierra del Nevado 3
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Argentina
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Sierra del
Nevado
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18% (Non-op)
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Exploration
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10
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Sierra del Nevado 4
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Argentina
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Sierra del
Nevado
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18% (Non-op)
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Exploration
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11
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JET
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Brazil
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POT-T-747
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70%
c
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Exploration
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a)
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Information
included in the table above is subject to change and may also be subject to partner or
regulatory approval
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|
b)
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Drilled
in 3Q2017 with testing planned in fourth quarter
|
|
c)
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A
30% working interest of proposed partners is subject to ANP approval
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OTHER
NEWS / RECENT EVENTS
Reporting
dates for 3Q2017 results release, conference call and work program and investment guidelines for 2018
GeoPark
will report its 3Q2017 financial results on Wednesday, November 15, 2017, after the market closes.
In conjunction
with the 3Q2017 results press release, GeoPark’s management will host a conference call on Thursday, November 16, 2017 at
10:00 am (Eastern Standard Time) to discuss 3Q2017 financial results and the work program and investment guidelines for 2018.
To listen
to the call, participants can access the webcast located in the Investor Support section of the Company’s website at www.geo-park.com.
Interested
parties may participate in the conference call by dialing the numbers provided below:
United
States Participants: 866-547-1509
International
Participants: +1 920-663-6208
Passcode:
99494005
Please
allow extra time prior to the call to visit the website and download any streaming media software that might be required to listen
to the webcast.
An archive
of the webcast replay will be made available in the Investor Support section of the Company’s website at www.geo-park.com
after the conclusion of the live call.
For
further information, please contact:
INVESTORS:
|
|
Stacy Steimel –
Shareholder Value Director
Santiago, Chile
T: +562 2242 9600
|
ssteimel@geo-park.com
|
|
|
MEDIA
Jared
Levy – Sard Verbinnen & Co
New York, USA
T: +1 (212) 687-8080
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jlevy@sardverb.com
|
|
|
Kelsey Markovich –
Sard Verbinnen & Co
New York, USA
T: +1 (212) 687-8080
|
kmarkovich@sardverb.com
|
NOTICE
Additional
information about GeoPark can be found in the “Investor Support” section on the website at www.geo-park.com.
Rounding
amounts and percentages: Certain amounts and percentages included in this press release have been rounded for ease of presentation.
Percentage figures included in this press release have not in all cases been calculated on the basis of such rounded figures,
but on the basis of such amounts prior to rounding. For this reason, certain percentage amounts in this press release may vary
from those obtained by performing the same calculations using the figures in the financial statements. In addition, certain other
amounts that appear in this press release may not sum due to rounding.
CAUTIONARY
STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION
This press
release contains statements that constitute forward-looking statements. Many of the forward- looking statements contained in this
press release can be identified by the use of forward-looking words such as ‘‘anticipate,’’ ‘‘believe,’’
‘‘could,’’ ‘‘expect,’’ ‘‘should,’’ ‘‘plan,’’
‘‘intend,’’ ‘‘will,’’ ‘‘estimate’’ and ‘‘potential,’’
among others.
Forward-looking
statements that appear in a number of places in this press release include, but are not limited to, statements regarding the intent,
belief or current expectations, regarding various matters, including expected 2017 production growth, expected schedule, economic
recovery, payback timing, IRR, drilling activities, demand for oil and gas and capital expenditures plan. Forward-looking statements
are based on management’s beliefs and assumptions, and on information currently available to the management. Such statements
are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking
statements due to various factors.
Forward-looking
statements speak only as of the date they are made, and the Company does not undertake any obligation to update them in light
of new information or future developments or to release publicly any revisions to these statements in order to reflect later events
or circumstances, or to reflect the occurrence of unanticipated events. For a discussion of the risks facing the Company which
could affect whether these forward-looking statements are realized, see filings with the U.S. Securities and Exchange Commission.
Oil and
gas production figures included in this release are stated before the effect of royalties paid in kind, consumption and losses,
except when specified.
Readers
are cautioned that the exploration resources disclosed in this press release are not necessarily indicative of long term performance
or of ultimate recovery. Unrisked prospective resources are not risked for change of development or chance of discovery. If a
discovery is made, there is no certainty that it will be developed or, if it is developed, there is no certainty as to the timing
of such development. There is no certainty that any portion of the Prospective Resources will be discovered. If discovered, there
is no certainty that it will be commercially viable to produce any portion of the resources. Prospective Resource volumes are
presented as unrisked.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
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GeoPark Limited
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By:
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/s/ Andrés
Ocampo
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Name:
|
Andrés Ocampo
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Title:
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Chief FinancialOfficer
|
Date:
October 12, 2017
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