ma
Eos el
GEOPARK
Santiago, 26 de agosto de 2014
Geopark Limited
Inscrito en el Registro de Valores Extranjeros bajo N* 045
Señor
Carlos Pavez Tolosa
Superintendente de Valores y Seguros
Av. Libertador Bernardo O’Higgins N* 1449, piso 1
PRESENTE
REF.: Adjunta información relevante que se
publicó en el U.S. Securities and
Exchange Commission (SEC) el día de
hoy.
Señor Superintendente:
En virtud de lo establecido en la Norma de Carácter
General N*352, por medio de la presente adjunto información considerada como
relevante para la empresa, que ha sido entregada el día de hoy en el U.S. Securities
and Exchange Commission (“SEC”), en donde se informa los estados financieros
consolidados de la Compañía correspondientes al periodo de seis meses finalizado
el 30 de junio de 2014.
La información adjunta consiste en un documento de
veinte páginas escrito en idioma inglés.
Sin otro particular, saluda atentamente a Usted,
Pedro Aylwin Chiorrini
pp. GEOPARK LIMITED
Nuestra Señora de los Ángeles 179 – Las Condes, Santiago – Chile
Tel. (+56 2) 2429600 – infoWgeo-park.com – www.geo-park.com
GEOPARK LIMITED
INTERIM CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
For the six-months period ended 30 June 2013 and 2014
GEOPARK LIMITED
30 JUNE 2014
CONTENTS
Page
3 Consolidated Statement of Income and Statement of Comprehensive Income
4 Consolidated Statement of Financial Position
5 Consolidated Statement of Changes in Equity
6 Consolidated Statement of Cash Flow
7 Selected explanatory notes
GEOPARK LIMITED
30 JUNE 2014
CONSOLIDATED STATEMENT OF INCOME
Three-months Three-months Six-months Six-months
period ended 30 period ended 30 period ended 30 period ended 30
June 2014 June 2013 June 2014 June 2013
Amounts in US$ ‘000 Note (Unaudited) (Unaudited) (Unaudited) (Unaudited)
NET REVENUE 2 131,449 72,871 216,180 160,806
Production costs 4 (64,327) (42,834) (102,001) (81,147)
GROSS PROFIT 67,122 30,037 114,179 79,659
Selling expenses (5,999) (1,591) (12,317) (7,658)
Exploration costs 5 (7,437) (6,282) (14,243) (13,587)
Administrative costs 6 (11,833) (11,124) (22,962) (20,730)
Other operating income 361 4,359 974 4,205
OPERATING PROFIT 42,214 15,399 65,631 41,889
Financial income 7 5,019 298 5,767 604
Financial expenses 8 (8,566) (8,248) (16,896) (21,166)
PROFIT BEFORE TAX 38,667 7,449 54,502 21,327
Income tax (11,321) (2,659) (16,832) (7,092)
PROFIT FOR THE PERIOD 27,346 4,790 37,670 14,235
Attributable to:
Owners of the parent 21,756 2,136 28,458 8,616
Non-controlling interest 5,590 2,654 9,212 5,619
Earnings per share (in US$) tor profit attributable
to owners of the Company. Basic 0.39 0.05 0.52 0.20
Earnings per share (in US$) tor profit attributable
to owners of the Company. Diluted 0.35 0.05 0.45 0.19
STATEMENT OF COMPREHENSIVE INCOME
Three-months Three-months Six-months Six-months
period ended 30 period ended 30 period ended 30 period ended
June 2014 June 2013 June 2014 30 June 2013
Amounts in US$ ‘000 (Unaudited) (Unaudited) (Unaudited) (Unaudited)
Profit for the period 27,346 4,790 37,670 14,235
Other comprehensive income
Currency translation differences 1,413 – 2,344 (363)
Total comprehensive Income for the period 28,759 4,790 40,014 13,872
Attributable to:
Owners of the parent 23,169 2,136 30,802 8,253
Non-controlling interest 5,590 2,654 9,212 5,619
GEOPARK LIMITED
30 JUNE 2014
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 30 June
2014 Year ended 31
Amounts in US$ “000 Note (Unaudited) December 2013
ASSETS
NON CURRENT ASSETS
Property, plant and equipment 9 785,388 595,446
Prepaid taxes 13,934 11,454
Other financial assets 6,857 5,168
Deferred income tax 18,371 13,358
Prepayments and other receivables 465 6,361
TOTAL NON CURRENT ASSETS 825,015 631,787
CURRENT ASSETS
Inventories 16,373 8,122
Trade receivables 61,336 42,628
Prepayments and other receivables 37,717 35,764
Prepaid taxes 13,722 6,979
Cash at bank and in hand 125,297 121,135
TOTAL CURRENT ASSETS 254,445 214,628
TOTAL ASSETS 1,079,460 846,415
EQUITY
Equity attributable to owners of the
Company
Share capital 10 58 44
Share premium 211,274 120,426
Reserves 128,809 126,465
Retained earnings 57,201 23,906
Attributable to owners of the Company 397,342 270,841
Non-controlling interest 104,328 95,116
TOTAL EQUITY 501,670 365,957
LIABILITIES
NON CURRENT LIABILITIES
Borrowings 11 349,921 290,457
Provisions for other long-term liabilities 12 42,372 33,076
Deferred income tax 45,563 23,087
Trade and other payables 13 7,011 8,344
TOTAL NON CURRENT LIABILITIES 444,867 354,964
CURRENT LIABILITIES
Borrowings 11 18,723 26,630
Current income tax 4,299 7,231
Trade and other payables 13 109,901 91,633
TOTAL CURRENT LIABILITIES 132,923 125,494
TOTAL LIABILITIES 577,790 480,458
TOTAL EQUITY AND LIABILITIES 1,079,460 846,415
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
GEOPARK LIMITED
30 JUNE 2014
Attributable to owners of the Company
Retained
earnings Non –
Share Share Other Translation (accumulated “ontrolling
Amount in US$ ‘000 Capital Premium Reserve Reserve losees) Interest Total
Equity at 1 January 2013 43 116,817 127,527 894 (5,860) 72,665 312,086
Profit for the first half of the year – – – – 8,616 5,619 14,235
Currency translation differences – – – (363) – – (363)
Total comprehensive income for the period . . .
ended 30 June 2013 (363) 8,616 5,619 13,872
Proceeds from transaction with Non-controlling Ñ _ _ Ñ Ñ
interest 5,175 5,175
Shared-based payment – 60 – – 3,486 – 3,546
– 60 – – 3,486 5,175 8,721
Balance at 30 June 2013 (Unaudited) 43 116,877 127,527 531 6,242 83,459 334,679
Balance at 31 December 2013 44 120,426 127,527 (1,062) 23,906 95,116 365,957
Profit for the first half of the year – – – – 28,458 9,212 37,670
Currency translation differences – – – 2,344 – – 2,344
Total comprehensive income for the period
ended 30 June 2014 – – – 2,344 28,458 9,212 40,014
Proceeds from issue of shares 14 90,848 – – – – 90,862
Shared-based payment – – – – 4,837 – 4,837
14 90,848 – – 4,837 – 95,699
Balance at 30 June 2014 (Unaudited) 58 211,274 127,527 1,282 57,201 104,328 501,670
GEOPARK LIMITED
30 JUNE 2014
CONSOLIDATED STATEMENT OF CASH FLOW
Six-months Six-months
period ended period ended
30 June 2014 30 June 2013
Amounts in US$ ‘000 (Unaudited) (Unaudited)
Cash flows from operating activities
Profit for the period 37,670 14,235
Adjustments for:
Income tax 16,832 7,092
Depreciation 48,070 32,605
Loss on disposal of property, plant and equipment 68 568
Write-off of unsuccessful exploration and evaluation assets 8,637 11,788
Amortisation of other long-term liabilities (291) (1,359)
Accrual of borrowing’s interests 12,841 11,881
Unwinding of long-term liabilities 706 505
Accrual of share-based payment 5,597 3,486
Income tax paid (1,306) (4,040)
Changes in operating assets and liabilities (23,843) (9,655)
Cash flows from operating activities – net 104,981 67,106
Cash flows from investing activities
Purchase of property, plant and equipment (118,161) (113,952)
Acquisitions of companies, net of cash acquired (114,967) –
Collections related to financial leases 3,391 6,489
Cash flows used in investing activities – net (229,737) (107,463)
Cash flows from financing activities
Proceeds from issuance of shares 90,862 –
Proceeds from borrowings 67,155 292,363
Proceeds from transaction with non-controlling interest – 36,313
Proceeds from loans from related parties – 8,344
Principal paid (18,550) (179,343)
Interest paid (11,311) (6,175)
Cash flows from financing activities – net 128,156 151,502
Net increase in cash and cash equivalents 3,400 111,145
Cash and cash equivalents at 1 January 121,135 38,292
Currency translation differences 753 –
Cash and cash equivalents at the end of the period 125,288 149,437
Ending Cash and cash equivalents are specified as
follows:
Cash in banks 125,276 149,413
Cash in hand 21 24
Bank overdratfts (9) –
Cash and cash equivalents 125,288 149,437
GEOPARK LIMITED
30 JUNE 2014
SELECTED EXPLANATORY NOTES
Note 1
General information
GeoPark Limited (the Company) is a company incorporated under the law of Bermuda. The Registered
Office address is Cumberland House, 9th Floor, 1 Victoria Street, Hamilton HM11, Bermuda.
The principal activity of the Company and its subsidiaries (“the Group”) are exploration, development and
production for oil and gas reserves in Chile, Colombia, Brazil and Argentina. The Group has working
interests and/or economic interests in 29 hydrocarbon blocks.
On 7 February 2014, the Securities and Exchange Commission (“SEC”) declared effective the Company’s
registration statement upon which 13,999,700 shares were issued, including over-allotment option, at a
price of US$ 7 per share. Gross proceeds from the offering totalled US$ 98 million. As a result, the
Company commenced trading on the New York Stock Exchange (“NYSE”) under the ticker symbol GPRK.
Also its shares are authorized for trading on the Santiago Off-Shore Stock Exchange.
Subsequently, the Company listing cancellation on the AIM London Stock Exchange became effective on
19 February 2014.
This consolidated interim financial report was authorised for issue by the Board of Directors on
21 August, 2014.
Basis of Preparation
The consolidated interim financial report of GeoPark Limited is presented in accordance with lAS 34
“Interim Financial Reporting”. lt does not include all of the information required for full annual financial
statements, and should be read in conjunction with the annual financial statements as at and for the years
ended 31 December 2012 and 2013, which have been prepared in accordance with IFRS.
The consolidated interim financial report has been prepared in accordance with the accounting policies
applied in the most recent annual financial statements. For further information please refer to GeoPark
Limited’s consolidated financial statements for the year ended 31 December 2013.
Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected
total annual profit or loss.
The activities of the Company are not subject to significant seasonal changes.
GEOPARK LIMITED
30 JUNE 2014
Note 1 (Continued)
Estimates
The preparation of interim financial information requires the use of certain critical accounting estimates. It
also requires management to exercise its judgement in the process of applying the Group’s accounting
policies. Actual results may differ from these estimates.
In preparing these condensed consolidated interim financial statements, the significant judgements made
by management in applying the group’s accounting policies and the key sources of estimation uncertainty
were the same as those that applied to the consolidated financial statements for the year ended 31
December 2013.
Financial risk management
The Company’s activities expose it to a variety of financial risks: currency risk, price risk, credit risk-
concentration, funding and liquidity risk, interest risk and capital risk. The interim condensed consolidated
financial statements do not include all financial risk management information and disclosures required in
the annual financial statements, and should be read in conjunction with the Company’s annual financial
statements as at 31 December 2013.
There have been no changes in the risk management since year end or in any risk management policies.
Subsidiary undertakings
The following chart illustrates the Group structure as of 30 June 2014 (*):
1008 130% 2… 229% 2…
[ jr L L [ ]
GesPañ Lale Í id GeoPar Lal GesPon Pen Gore Era
Amañas ¡ degentes Amenos Tosomnre Cospermte YA Totomatiey A
Limitas – Bermuda , Urra – Berria yA Netreenda; atraer
M o 1 (Bermuda) Menenaras.
109% ! oom tos iva
GeoFañ Lars sora Georan colombia loo GecPaa Baal
Armacica Limites ¡ jmbed- re 5
2 | A ee
¡Culos ; [Argenta] poor
93a
Georan Catomts
BAD ¡Calorntea)
7 me | 20%
so lam | nata Colo Ger ta [i | A, [o | co
reracral SA. ¡Chiaj Criar j i (Chiles mamona!
20% 00%
DesPañn TF Genre Fe
SA 1Coila) SA Cde
(*) LG International is not a subsidiary, it is Non-controlling interest.
During 2013 and 2014, with the purpose of conducting its multilocation activities and for allowing future business
structures, the Company has incorporated certain wholly owned subsidiaries, that are dormant companies at the date
of the issuance of these interim financial statements.
Note 1 (Continued)
Subsidiary undertakings (Continued)
Details of the subsidiaries and joint operations of the Company are set out below:
Name and registered office
GEOPARK LIMITED
30 JUNE 2014
Ownership interest
Subsidiaries GeoPark Argentina Ltd. – Bermuda 100%
GeoPark Argentina Ltd. – Argentinean Branch 100% (a) (k)
GeoPark Latin America Limited 100% (9)
GeoPark Latin America Limited – Agencia en Chile 100% (a) (9)
GeoPark S.A. (Chile) 100% (a) (b)
GeoPark Brazil Exploragcáo y Producáo de Petróleo e Gas
Ltda. (Brazil) 100% (a)
Rio das Contas Produtora de Petróleo Ltda (Brazil) 100% (a) (j)
GeoPark Chile S.A. (Chile) 80% (a) (c)
GeoPark Fell S.p.A. (Chile) 80% (a) (c)
GeoPark Magallanes Limitada (Chile) 80% (a) (c)
GeoPark TdF S.A. (Chile) 68.8% (a) (d)
GeoPark Colombia S.A. (Chile) 80% (a)
GeoPark Colombia SAS (Colombia) 100% (a) (h)
GeoPark Brazil S.p.A. (Chile) 100% (a) (b)
GeoPark Latin America Cooperatie U.A. (The Netherlands) 100%
GeoPark Colombia Cooperatie U.A. (The Netherlands) 100% (a) (c)
GeoPark Perú Cooperatie U.A. (The Netherlands) 100%(b)
GeoPark Brazil Cooperatie U.A. (The Netherlands) 100%
Associates Raven Pipeline Company LLC (United States) 23.5% (b)
Joint operations Tranquilo Block (Chile) 29% (i) (f)
Otway Block (Chile) 25% (e) (f)
Flamenco Block (Chile) 50% (f)
Campanario Block (Chile) 50% (f)
Isla Norte Block (Chile) 60% (f)
Llanos 17 Block (Colombia) 36.84%
Yamu/Carupana Block (Colombia) 75%/54.5% (f) (1)
Llanos 34 Block (Colombia) 45% (f)
Llanos 32 Block (Colombia) 10%
Manati Field (Brazil) 10% (i)
(a)
(b)
(c)
(d)
(e)
(1
(9)
(hn)
Indirectly owned.
Dormant companies.
LG International has 20% interest.
LG International has 20% interest through GeoPark Chile S.A. and a 14% direct interest, totalling 31.2%.
In April 2013, the Group voluntarily relinquished to the Chilean Government all of our acreage in the Otway Block, except for
49,421 acres. In May 2013, our partners under the joint operating agreement governing the Otway Block decided to
withdraw from such joint operating agreement and to apply to withdraw from the Otway Block CEOP, such that, subject to
the Chilean Ministry of Energy’s approval, the Group will be the sole participant, and have a working interest of 100%, in the
remaining areas in the Otway Block.
GeoPark is the operator in all blocks.
Formerly named GeoPark Chile Limited.
During 2013, the Company has finalized a merger process by which GeoPark Colombia SAS will continue the operations
related to GeoPark Luna SAS (Colombia), GeoPark Llanos SAS (Colombia), La Luna Oil Co. Ltd. (Panama), Winchester Oil
and Gas S.A. (Panama), GeoPark Cuerva LLC (United States), Sucursal La Luna Oil Co. Ltd. (Colombia), Sucursal
Winchester Oil and Gas S.A. (Colombia) and Sucursal GeoPark Cuerva LLC (Colombia).
At 31 December 2013, the Consortium members and interest were: GeoPark 29%, Pluspetrol 29%, Wintershall 25% and
Methanex 17%. During 2014, Methanex and Wintershall announced their decision to abandon the Consortium. The new
ownership is being negotiated among GeoPark and Pluspetrol.
See Note 14.
In April 2014, the Company informed the Secretary of Infrastructure and Energy of the province of Mendoza of its decision
to relinquish 100% of the Cerro Doña Juana and Loma Cortaderal Concessions to the Mendoza Province.
See Note 15.
GEOPARK LIMITED
30 JUNE 2014
Note 2
Net Revenue
Three-months Three-months Six-months Six-months
period ended 30 period ended 30 period ended 30 period ended 30
Amounts in US$ ‘000 June 2014 June 2013 June 2014 June 2013
Sale of crude oil 112,022 67,946 187,256 149,817
Sale of gas 19,427 4,925 28,924 10,989
131,449 72,871 216,180 160,806
Note 3
Segment Information
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources
and assessing performance of the operating segments, has been identified as the strategic steering
committee. This committee is integrated by the CEO, COO, CFO and managers in charge of the
Geoscience, Drilling, Operations and SPEED departments. This committee reviews the Group’s internal
reporting in order to assess performance and allocate resources. Management has determined the
operating segments based on these reports.
The committee considers the business from a geographic perspective.
The strategic steering committee assesses the performance of the operating segments based on a
measure of Adjusted EBITDA. Adjusted EBITDA is defined as profit for the period before net finance cost,
income tax, depreciation, amortization and certain non-cash items such as impairments and write-offs of
unsuccessful exploration and evaluation assets, accrual of stock options and stock awards. Other
information provided, except as noted below, to the strategic steering committee is measured in a manner
consistent with that in the financial statements.
10
GEOPARK LIMITED
30 JUNE 2014
Note 3 (Continued)
Segment Information (Continued)
Six-months period ended 30 June 2014
Amounts in US$ ‘000 Total Argentina Chile Brazil Colombia Corporate
Net Revenue 216,180 853 86,368 12,287 116,672 –
Gross Profit 114,179 713 47,962 5,106 60,398 –
Operating Profit / (Loss) 65,631 (3,181) 27,283 3,015 42,380 (3,866)
Adjusted EBITDA 124,780 (1,223) 53,218 7,066 67,520 (1,801)
Six-months period ended 30 June 2013
Amounts in US$ ‘000 Total Argentina Chile Brazil Colombia Corporate
Net Revenue 160,806 733 82,855 – 77,218 –
Gross Profit 79,659 19 49,167 – 30,473 –
Operating Profit / (Loss) 41,889 (1,822) 33,239 (1,365) 17,801 (5,964)
Adjusted EBITDA 84,014 (1,284) 52,267 (1,341) 38,296 (3,924)
Total Assets Total Argentina Chile Brazil Colombia Corporate
30 June 2014 1,079,460 5,221 538,603 168,689 305,348 61,599
31 December 2013 846,415 7,977 477,263 29,222 259,421 72,532
A reconciliation of total Adjusted EBITDA to total profit before income tax is provided as follows:
Three-months Three-months Six-months Six-months
period ended 30 period ended 30 period ended 30 period ended 30
June 2014 June 2013 June 2014 June 2013
Adjusted EBITDA for reportable segments 76,401 34,362 124,780 84,014
Depreciation e (27,570) (16,836) (45,678) (32,605)
Share-based payment (2,635) (1,679) (5,597) (3,486)
Impairment and write-off of unsuccessful efforts (4,550) (5,871) (8,637) (11,788)
Others ” 569 5,423 763 5,754
Operating profit 42,215 15,399 65,631 41,889
Financial results (3,547) (7,950) (11,129) (20,562)
Profit before tax 38,668 7,449 54,502 21,327
(2) Netof capitalised costs for oil stock included in Inventories.
(b)
Includes internally capitalised costs.
11
GEOPARK LIMITED
30 JUNE 2014
Note 4
Production costs
Three- Three-
months months Six-months Six-months
period ended period ended period ended period ended
Amounts in US$ ‘000 30 June 2014 30 June 2013 30 June 2014 30 June 2013
Depreciation 25,775 16,447 46,980 31,898
Well and facilities maintenance 5,777 4,733 10,243 9,003
Royalties 6,378 4,086 10,795 8,650
Consumables 4,803 3,049 9,220 6,610
Transportation costs 3,491 2,691 7,075 4,946
Staff costs 3,769 5,518 6,866 7,518
Equipment rental 2,194 782 4,074 2,360
Field camp 1,533 846 2,856 1,844
Gas plant costs 804 776 1,639 1,587
Non operated blocks costs 1,587 1,544 2,834 2,110
Other costs 4,811 4,564 7,336 5,794
Crude oil stock variation 3,405 (2,202) (7,917) (1,173)
64,327 42,834 102,001 81,147
Note 5
Exploration costs
Three- Three-
. months months Six-months Six-months
Amounts in US$ ‘000 o o – .
period ended period ended period ended period ended 30
30 June 2014 30 June 2013 30 June 2014 June 2013
Write-off of unsuccessful exploration
and evaluation assets 4,550 sen 8,887 11,788
Staff costs 2,823 1,889 5,721 4,084
Other services 634 146 1,065 219
Allocation to capitalised project (570) (265) (1,180) (1,145)
Amortisation of other long-term
liabilities related to unsuccesstul – (600) – (600)
efforts
Recovery of abandonments costs – (759) – (759)
7,437 6,282 14,243 13,587
12
GEOPARK LIMITED
30 JUNE 2014
Note 6
Administrative costs
Three-months Three-months Six-months Six-months
period ended 30 period ended period ended period ended
Amounts in US$ ‘000 June 2014 30 June 2013 30June 2014 30 June 2013
Staff costs 5,252 4,801 10,810 9,976
Consultant fees 1,528 1,946 2,791 3,082
Office expenses 1,037 439 1,806 781
New projects 880 485 1,311 661
Depreciation 571 389 1,090 707
Travel expenses 463 671 967 1,190
Director fees and allowance 326 726 612 992
Other administrative expenses 1,776 1,667 3,575 3,341
11,833 11,124 22,962 20,730
Note 7
Financial income
Three-months Three-months Six-months Six-months
period ended 30 period ended 30 period ended 30 period ended
Amounts in US$ ‘000 June 2014 June 2013 June 2014 30 June 2013
Exchange difference 3,173 (36) 3,404 2
Interest received 1,846 334 2,363 602
5,019 298 5,767 604
Note 8
Financial expenses
Three-months Three-months Six-months Six-months
period ended 30 period ended 30 period ended 30 period ended 30
Amounts in US$ ‘000 June 2014 June 2013 June 2014 June 2013
Bank charges and other financial costs 708 1,303 1,015 1,568
Bond GeoPark Fell SpA cancellation costs – – – 8,603
Exchange difference 498 931 2,012 1,483
Unwinding of long-term liabilities 651 289 706 505
Interest and amortisation of debt issue costs 7,544 6,227 14,380 9,931
Less: amounts capitalised on qualifying assets (835) (502) (1,217) (924)
8,566 8,248 16,896 21,166
13
GEOPARK LIMITED
30 JUNE 2014
Note 9
Property, plant and equipment
Buildings Exploration
Furniture, Production and and
Oil 8 gas equipment facilities and improve– Construction evaluation
Amounts in US$’000 properties and vehicles machinery ments in progress assets TOTAL
Cost at 1 January 2013 344,371 3,576 86,949 3,198 54,025 93,106 585,225
Additions 2,502 1,128 10 47 59,479 83,979 147,145
Disposals (546) (22) (15,870) – – – (16,438)
Write-off and impairment (‘ – – – – – (11,788) (11,788)
Transfers 77,166 – 14,963 927 (61,433) (31,623) –
Cost At 30 June 2013 423,493 4,682 86,052 4,172 52,071 133,674 704,144
Cost at 1 January 2014 493,260 5,731 98,837 7,018 40,429 147,759 793,034
Additions 1,592 1,460 – – 53,365 71,517 127,934
Acquisition of subsidiaries 115,345 270 – – – – 115,615
Currency translation differences 3,168 – – – – – 3,168
Disposals – (319) – – – – (319)
Write-off and impairment (‘ – – – – – (8,637) (8,637)
Transfers 91,219 – 7,568 95 (48,798) (50,084) –
Cost At 30 June 2014 704,584 7,142 106,405 7,113 44,996 160,555 1,030,795
Depreciation and write-down
at 1 January 2013 (98,156) (1,836) (26,336) (1,060) – – (127,388)
Depreciation (27,418) (427) (4,480) (280) – – (32,605)
Depreciation and write-down
At 30 June 2013 (125,574) (2,263) (30,816) (1,340) – – (159,993)
Depreciation and write-down
at 1 January 2014 (157,390) (2,800) (35,677) (1,721) – – (197,588)
Depreciation (41,356) (702) (5,623) (389) – – (48,070)
Disposals – 251 – – – – 251
Depreciation and write-down
at 30 June 2014 (198,746) (3,251) (41,300) (2,110) – – (245,407)
Carrying amount at 30 June
2013 297,919 2,419 55,236 2,832 52,071 133,674 544,151
Carrying amount at 30 June
2014 505,838 3,891 65,105 5,003 44,996 160,555 785,388
(1 Corresponds to write-off of Exploration and evaluation assets in Chile for US$ 6,865,000 (US$ 8,753,000 in
2013) and US$ 1,772,000 in Colombia (US$ 3,035,000 in 2013). During the second quarter of 2014 the
Company has written off all of its assets related to Otway Block in Chile for US$ 2,778,000 and two wells in
the Non operated Arrendajo Block in Colombia.
14
Note 10
Share capital
GEOPARK LIMITED
30 JUNE 2014
Six-months
period ended 30 Year ended 31
Issued share capital June 2014 December 2013
Common stock (US$ “000) 58 44
The share capital is distributed as follows:
Common shares, of nominal US$ 0.001 57,863,615 43,861,614
Total common shares in issue 57,863,615 43,861,614
Authorised share capital
US$ per share 0.001 0.001
Number of common shares (US$ 0.001 each) 5,171,949,000 5,171,949,000
Amount in US$ 5,171,949 5,171,949
GeoPark’s share capital only consists of common shares. The authorized share capital consists of
5,171,949,000 common shares of par value US$0.001 per share. As of the date of this interim condensed
consolidated report, there are 57,863,615 common shares outstanding (see Note 1). All of the Company
issued and outstanding common shares are fully paid and nonassessable. The Company also has an
employee incentive program, pursuant to which it has granted share awards to its senior management and
certain key employees (see Notes 25 and 29 to the audited Consolidated Financial Statements as of 31
December 2013).
Note 11
Borrowings
The outstanding amounts are as follows:
Year ended
At 31 December
Amounts in US$ ‘000 30 June 2014 2013
Bond GeoPark Latin America Agencia
en Chile (a) 300,427 299,912
Banco de Chile (b) – 15,002
Banco de Crédito e Inversiones (c) 152 2,143
Banco Itaú (d) 68,056 –
Overdrafts (e) 9 30
368,644 317,087
Classified as follows:
Current 18,723 26,630
Non-Current 349,921 290,457
15
GEOPARK LIMITED
30 JUNE 2014
Note 11 (Continued)
Borrowings (Continued)
(a) During February 2013, the Company successfully placed US$ 300 million notes which were offered
under Rule 144A and Regulation S exemptions of the United States Securities laws.
The Notes, issued by the Company’s wholly-owned subsidiary GeoPark Latin America Limited Agencia en
Chile (“the Issuer”), were priced at 99.332% and carry a coupon of 7.50% per annum (yield 7.625% per
annum). Final maturity of the notes will be 11 February 2020. The Notes are guaranteed by GeoPark
Limited and GeoPark Latin America Cooperatie U.A. and are secured with a pledge of all of the equity
interests of the Issuer in GeoPark Chile S.A. and GeoPark Colombia Cooperatie U.A. and a pledge of
certain intercompany loans. Notes were rated single B by both Standard 8 Poor’s and Fitch Ratings. The
debt issuance cost for this transaction amounted to US$ 7,637,000. The Notes include covenants
restricting dividend payments and new indebtedness. As of the date of these interim condensed
consolidated financial statements, the Company has complied with these covenants.
(b) Short term financing obtained in December 2013 and fully repaid in January 2014. The interest rate
applicable to this loan was 0.71% per annum.
(c) Facility to establish the operational base in the Fell Block. This facility was acquired through a mortgage
loan granted by the Banco de Crédito e Inversiones (BCI), a Chilean private bank. The loan was granted in
Chilean pesos and is repayable over a period of 8 years. The interest rate applicable to this loan is 6.6%.
The outstanding amount at 30 June 2014 is US$ 152,000 (US$ 212,000 in 2013).
In addition, during 2011, GeoPark TdF obtained financing from BCI to start the operations in the newly
acquired blocks. The outstanding amount at 31 December 2013 was US$ 1,931,000. This financing was
structured as letter of credit and was fully repaid in February 2014.
(d) During March 2014, GeoPark executed a loan agreement with Itaú BBA International for
US$ 70,450,000 to finance the acquisition of a 10% working interest in the Manatí field in Brazil (see Note
14). The interest rate applicable to this loan is LIBOR plus 3.9% per annum. The interest will be paid semi-
annually; principal will be cancelled semi-annually with a year grace period. The debt issuance cost for this
transaction amounted to US$ 3,295,000. This loan includes covenants restricting dividend payments and
new indebtedness. As of the date of these interim condensed consolidated financial statements, the
Company has complied with these covenants.
(e) The Group has been granted with credit lines for over US$ 85,000,000.
16
GEOPARK LIMITED
30 JUNE 2014
Note 12
Provision for other long-term liabilities
The outstanding amounts are as follows:
Year ended
At 31 December
Amounts in US$ ‘000 30 June 2014 2013
Assets retirement obligation and other
environmental liabilities 31,909 24,166
Deferred income 5,912 6,204
Other 4,551 2,706
42,372 33,076
Note 13
Trade and other payables
The outstanding amounts are as follows:
Year ended
At 31 December
Amounts in US$ ‘000 30 June 2014 2013
Trade payables 76,807 61,130
V.A.T. 8,049 8,074
Taxes and other debts to be paid 7,263 9,190
Staff costs to be paid 7,066 8,551
Payables to related parties ‘” 7,011 8,456
To be paid to co-venturers 6,118 1,201
Royalties to be paid 4,598 3,375
116,912 99,977
Classified as follows:
Current 109,901 91,633
Non-Current 7,011 8,344
Mm Corresponas to related parties loans granted by LGl. The maturity of these loans is December 2015 and the
applicable interest rate is 8% per annum.
17
GEOPARK LIMITED
30 JUNE 2014
Note 14
Entry in Brazil
Acquisition in Brazil
GeoPark entered into Brazil with the acquisition of a 10% working interest in the offshore Manati gas field
(“Manati Field”), the largest natural gas producing field in Brazil. On May 14, 2013, GeoPark executed a
stock purchase agreement (“SPA”) with Panoro Energy do Brazil Ltda., the subsidiary of Panoro Energy
ASA, (“Panoro”), a Norwegian listed company with assets in Brazil and Africa, to acquire all of the issued
and outstanding shares of its wholly-owned Brazilian subsidiary, Rio das Contas Produtora de Petróleo
Ltda (“Rio das Contas”), the direct owner of 10% of the BCAM-40 block (the “Block”), which includes the
shallow-depth offshore Manati Field in the Camamu-Almada basin.
GeoPark has paid a cash consideration of US$ 140 million at 31 March 2014 or the closing date, which
was adjusted for working capital with an effective date of 30 April 2013. The agreement also provides for
possible future contingent payments by GeoPark over the next five years, depending on the economic
performance and cash generation of the Block (see Note 34 to the audited Consolidated Financial
Statements as of 31 December 2013).
The Manati Field is a strategically important, profitable upstream asset in Brazil and currently provides
approximately 50% of the gas supplied to the northeastern region of Brazil and more than 75% of the gas
supplied to Salvador, the largest city and capital of the northeastern state of Bahia. The field is largely
developed with existing producing wells and an extensive pipeline, treatment and delivery infrastructure
and is not expected to require significant future capital expenditures to meet current production estimates.
Additional reserve development may be possible.
The Manati Field is operated by Petrobras (35% working interest), the Brazilian national company, largest
oil and gas operator in Brazil and internationally-respected offshore operator. Other partners in the block
include Queiroz Galvao Exploracao e Producao (45% working interest) and Brasoil Manati Exploracao
Petrolifera S.A. (10% working interest).
In accordance with the acquisition method of accounting, the acquisition cost was allocated to the
underlying assets acquired and liabilities assumed based primarily upon their estimated fair values at the
date of acquisition. An income approach (being the net present value of expected future cash flows) was
adopted to determine the fair values of the mineral interest. Estimates of expected future cash flows reflect
estimates of projected future revenues, production costs and capital expenditures based on our business
model. The purchase price allocation performed is preliminary, since the valuation process is ongoing. This
process will be completed during 2014.
18
GEOPARK LIMITED
30 JUNE 2014
Note 14 (Continued)
Entry in Brazil (Continued)
The following table summarises the consideration paid, the preliminary fair value of assets acquired and
liabilities assumed for the abovementioned transaction:
Amounts in US$ ‘000 Total
Cash (including working capital adjustments) 140,100
Total consideration 140,100
Cash and cash equivalents 25,133
Property, plant and equipment (including mineral interest) 115,615
Trade receivables 9,757
Prepayments and other receivables 3,177
Other financial assets 950
Deferred income tax liabilities (3,132)
Trade and other payables (4,538)
Provision for other long-term liabilities (6,862)
Total identifiable net assets 140,100
Round 12 in Brazil
On 28 November 2013, the ANP awarded GeoPark with two new concessions in a new international
bidding round, Round 12 (see Note 34 to the audited Consolidated Financial Statements as of 31
December 2013).
In Brazil, GeoPark Brazil is currently a party to a legal proceeding related to the concession agreement of
Block PN-T-597 that the ANP initially awarded to GeoPark Brazil in the 12th oil and gas bidding round. As a
result of a class action filed by the Federal Prosecutor’s Office, an injunction was issued by a Brazilian
Federal Court against the ANP, the Federal Government and GeoPark Brazil on 13 December 2013. Due
to the injunction GeoPark Brazil could not proceed to execute the concession agreement, and cannot do so
until the injunction is lifted. According to the terms of the Court’s injunction, the ANP will first need to take
certain actions, such as conducting studies that prove that drilling unconventional resources will not
contaminate the dams and aquifers in the region. On 21 February 2014, GeoPark Brazil requested that the
board of the ANP suspend the execution of the concession agreement (which entails delivery of the
financial guarantee and performance guarantee and payment of the signing bonus) for six months with a
possible extension of an additional six months, or until a firm court decision is reached that does not
prevent GeoPark Brazil from entering into the concession agreement. On 16 April 2014, the ANP’s Board
enacted a resolution stating that all proceedings related to the award of the concession of Block PN-T-597
to GeoPark Brazil were suspended.
19
GEOPARK LIMITED
30 JUNE 2014
Note 15
Subsequent events
New exploratory license in Colombia
GeoPark continued its expansion in Colombia through the award of a new exploratory license during the
2014 Colombia Bidding Round, carried out by the Agencia Nacional de Hidrocarburos (“*ANH”) on 23 July
2014 in Cartagena, Colombia.
GeoPark was awarded the VIM-3 Block in the Lower Magdalena Basin, covering an area of approximately
225,000 acres. The block has an attractive oil and gas exploration potential in a large area within a proven
hydrocarbon system, surrounded by existing oil and gas fields and with sparse exploration activity carried
out to date.
GeoPark’s winning bid consisted of committing to a minimum investment program of 200 sq km of 2D
seismic and drilling one exploration well, with a total estimated investment of US$ 22.2 million during the
initial three year exploratory period and a Royalty X Factor of 3%. GeoPark will operate and have a 100%
working interest in the block. The winning bid is subject to final signature of the contracts with the ANH,
which is currently scheduled for third quarter of 2014.
Swap operation in Colombia
On 29 July 2014, GeoPark’s Colombian subsidiary agreed to exchange its 10% non-operating economic
interest in Arrendajo Block for additional interests held by the seller in the Yamú Block (GeoPark operated)
that includes a 15% economic interest in all of the Yamú fields except for the Carupana field, where the
seller had a 25% economic interest. According to the terms of the exchange, GeoPark will also receive
US$3.2 million in cash from the exchange, adjusted by working capital. Following this transaction, GeoPark
will continue to be the operator and have a 79.5% interest in the Carupana Field and 90% in Yamú and
Potrillo Fields, all fields located in the Yamú Block.
20
Link al archivo en CMFChile: https://www.cmfchile.cl/sitio/aplic/serdoc/ver_sgd.php?s567=f2f11d097d835cf4e5d471d9117066c9VFdwQmVFNUVRVFJOUkVFMVRYcG5lRTFuUFQwPQ==&secuencia=-1&t=1682366909
