ma
Eos el
GEOPARK
Santiago, 19 de noviembre 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 mediante un comunicado de prensa se informa los
resultados del tercer trimestre terminado el 30 de septiembre de 2014.
La información adjunta consiste en un comunicado de prensa
de diecisiete páginas escrito en idioma inglés.
Sin otro particular, saluda atentamente a Usted,
4 Pedro Aylwin Chiorfíni
pp. GEOPARK LIMITED
Nuestra Señora de los Ángeles 179 – Las Condes, Santiago – Chile
Tel. (+56 2) 2429600 – infoWgeo-park.com – www.geo-park.com
E
GEOPARK
FOR IMMEDIATE DISTRIBUTION
GEOPARK REPORTS RESULTS FOR THE THIRD QUARTER
ENDED SEPTEMBER 30, 2014
Santiago, Chile – November 19, 2014 – GeoPark Limited (“GeoPark”) (NYSE: “GPRK”), the Latin American oil
and gas explorer, operator and consolidator with operations in Chile, Colombia, Brazil, Argentina, and Peru
today reports results for 3Q2014.
All figures are expressed in US dollars and growth comparisons refer to the same period of the prior year,
except when specified.
THIRD QUARTER 2014 HIGHLIGHTS
Operational:
e Total oil and gas production up 66% to 21,548 boepd compared to 3Q2013
+ Oil production in Colombia up 68% to 11,934 boepd
+ Reserves up in Tigana oil field in Colombia (GeoPark operated with 45% working interest (“WI”)) to 140-
170 mmbo OOIP and 45-65 mmbo of 3P reserves (PRMS gross) by internal estimates
+ 13 new exploration, development and appraisal wells were drilled in Chile and Colombia
Financial:
Net Revenues up 47% to $131.8 million compared to 3Q2013, driven by increased production
Adjusted EBITDA up 62% to $67.9 million from increased revenue and efficiency gains
Adjusted EBITDA per boe up 3% to $36.0 (in 5% lower oil price environment)
Operating Netback reached $43.5 per boe
Profit up 9% to $11.9 million
Cash position of $128.8 million at the close of 3Q2014
Strategic / New Business:
e Entry to Peru (GeoPark’s fifth country platform in Latin America) in October 2014 through the acquisition
of the Morona Block (GeoPark will operate with a 75% WI) in a joint venture with Petroperu, the
Peruvian state-owned oil and gas company. The Morona Block includes a discovered oil field (55 million
2P PRMS reserves certified by Ryder Scott) and attractive high impact exploration potential (200 to 600
million barrels of exploration resources).
+ Expansion of Colombian asset portfolio in November 2014 through a farm-in with the SK Group for the
CPO-4 Block in Llanos Basin (GeoPark will operate with a 50% WI).
James F. Park, GeoPark Chief Executive Officer, said, “Another strong quarter on our way to a successful
year of operational, financial and business growth. GeoPark’s consistent year-to-year growth performance
confirms the strength of our long term risk-balanced multi-country strategy in Latin America. It also
positions us to continue to prosper even in a declining oil price environment – with our high netback
projects, discretional work programs, strong balance sheet, and self-funding production base of 21,000
boepd.
Our exploration and drilling efforts continue to produce results – most importantly with the Tigana oil field
and reserve expansion in Colombia, and Tigana’s conversion into a low risk high potential production growth
platform. We are also excited about our entry into Peru with the acquisition of the Morona Block with its high
impact discovered Situche Central oil field and big exploration potential – and which adds further value and
depth to GeoPark’s significant organic inventory of development and exploration opportunities over our 31
blocks and 6 million acres.”
THIRD QUARTER 2014
The table below sets forth GeoPark’s production figures for 3Q2014 compared with 3Q2013.
3Q2014 302013
(espa) Oil (bopd) Gas (mcfpd) (oca) % Chg.
Chile 5,994 3,721 13,637 5,829 3%
Colombia 11,934 11,892 251 7,096 68%
Brazil 3,536 56 20,882 + N/A
Argentina 84 70 84 67 25%
Total 21,548 15,739 34,854 12,292 66%
* The acquisition of the interest in the Brazilian Manati Field was completed on March 31, 2014. As a reference and
only for comparison purposes, the corresponding net production for 3Q2013 amounted to 3,733 boepd.
The table below sets forth some key indicators of performance for 3Q2014 compared with 3Q2013. Figures
corresponding to 3Q2014 include the acquired interest in the Brazilian Manati Field completed on March 31,
2014. As of that date, GeoPark started consolidating line by line its results of operations for accounting
purposes within its Brazilian operations.
Key Indicators 3Q2014 3Q2013 % Chg.
Oil production (bopd) 15,739 11,163 41%
Gas production (mcfpd) 34,854 10,977 218%
Average net production (boepd) 21,548 12,992 66%
Average realized sales price
7 Oil ($ per bbl) 82.3 86.3 -5%
7 Gas ($ per mcf) 7.6 4.6 66%
Net Revenues ($ million) 131.8 89.7 47%
Production Costs ($ million) -67.5 -48.7 39%
Adjusted EBITDA ($ million) 67.9 41.9 62%
Adjusted EBITDA per boe ($) 36.0 34.9 3%
Operating Netback per boe ($) 43.5 44.5 -2%
Profit for the period ($ million) 11.9 11.0 9%
CONSOLIDATED OPERATING PERFORMANCE
Production: Consolidated production increased by 66% in 3Q2014 to 21,548 boepd. This growth is
explained by (i) a 41% increase in consolidated oil production, primarily from higher oil production in the
Colombian operations, and (ii) a 218% increase in gas production mainly due to the addition of the Brazilian
operations. On a proforma basis, consolidated average production grew 29% in 3Q2014. (Proforma figures in
this release refer to the incorporation in both periods of the acquired interest in the Brazilian Manati Field,
which closed on March 31, 2014.)
Net Revenues: Consolidated net revenues increased by 47% to $131.8 million in 3Q2014 compared to
$89.7 million in 3Q2013, mainly driven by increased oil production.
Consolidated Oil Revenues: Consolidated oil revenues increased 31% to $111.6 million in 3Q2014 compared
to 3Q2013, representing 86% of total net revenues compared to 95% in 3Q2013. Growth in net oil
revenues is mainly explained by higher production in Colombia, partially offset by lower production in Chile
and a 5% decrease in the consolidated average realized oil price to $82.3 per barrel.
Consolidated Gas Revenues: Consolidated gas revenues increased by 368% to $20.2 million in 3Q2014
compared to $4.3 million in 3Q2013, representing 14% of total net revenues in 3Q2014 compared to 5% in
3Q2013, and was mainly explained by the addition of the Brazilian operations along with higher average gas
prices in Chile.
Costs: Consolidated production costs increased by 39% to $67.5 million in 3Q2014, due to higher
production and deliveries in Colombia as well as the addition of the Brazilian operations.
Consolidated exploration costs increased to $3.4 million in 3Q2014 from $2.4 million in 3Q2013.
Consolidated administrative costs increased by 21% to $13.7 million in 3Q2014, mostly due to the addition
of the Brazilian operations.
Consolidated selling expenses increased to $9.3 million in 3Q2014 from $4.9 million in 3Q2013, driven by
increased selling expenses from increased production and deliveries in Colombia.
Adjusted EBITDA: Consolidated Adjusted EBITDA increased by 62% to $67.9 million in 3Q2014 compared
to $41.9 million in 3Q2013, mainly due to increased Adjusted EBITDA in the Colombian operations from
higher production, the addition of the Brazilian operations, as well as increased Adjusted EBITDA from
Chilean operations.
Adjusted EBITDA per boe increased by 3% to $36.0 per boe in 3Q2014 compared to $34.9 per boe in
3Q2013, despite a lower reference price for oil, mainly due to lower operating costs in Colombia, which were
partially offset by a higher proportion of gas revenues from the acquisition of the Brazilian operations in
March 2014.
ANALYSIS BY BUSINESS SEGMENT
Operations in Colombia
Key Indicators 3Q2014 3Q2013 % Chg.
Oil production (bopd) 11,892 7,088 68%
Gas production (mcfpd) 251 50 402%
Average net production (boepd) 11,934 7,096 68%
Net Revenues ($ million) 78.3 52.8 48%
Production Costs ($ million) -39.6 -33.1 20%
Adjusted EBITDA ($ million) 42.0 22.6 86%
Adjusted EBITDA per boe ($) 38.6 37.7 2%
Operating Netback per boe ($) 43.5 43.9 -1%
Production: Colombian oil production increased by 68% to 11,934 bopd in 3Q2014 compared to 3Q2013,
explained by new production from the Tigana oil field in the Llanos 34 Block (GeoPark operated with a 45%
WD.
Net Revenues: Colombian revenues increased by 48% to $78.3 in 3Q2014 mainly due to increased
production and deliveries, and partially offset by an increase in earn-out expenses. Colombian operations
represented 59% of the total consolidated net revenues in both 3Q2014 and 3Q2013.
The average realized oil price decreased by 7% to $79.0 per barrel in 3Q2014, which was mainly related to a
lower reference price of approximately 6% and higher quality discounts, partially offset by increased
deliveries made through pipelines at higher realization prices.
Earn-out expenses, as provided for in the Winchester purchase agreement and which are net of revenues,
increased to $7.6 million in 3Q2014 compared to $3.1 million in 3Q2013, mainly due to higher production in
the Llanos 34 Block.
Costs: Production costs per barrel decreased by 34% to $36.4 per barrel in Colombia mainly due to
improved fixed cost absorption and cost efficiencies. Total production costs increased by 20% to $39.6
million in 3Q2014, at a lower rate than revenue growth. Operating costs per boe decreased by 41% to $19.8
per boe, mainly due to improved fixed cost absorption and cost efficiencies. Operating costs in 3Q2014
increased by 6% to $21.5 million compared to $20.2 million in 3Q2013, mainly due to increased production
and deliveries.
Exploration expenses in Colombia amounted to $2.1 million in 3Q2014 compared to $0.8 million in 3Q2013.
Administrative costs in Colombia in 3Q2014 decreased to $3.5 million compared to $4.7 million in 3Q2013.
Selling expenses in Colombia in 3Q2014 increased to $5.6 million compared to $3.8 million in 3Q2013,
principally driven by the increase in production and deliveries, of which a higher proportion was sold by
pipelines at a higher realized price and with higher associated selling expenses.
Adjusted EBITDA: Adjusted EBITDA in Colombia increased by 86% to $42.0 million in 3Q2014 compared
to $22.6 million in 3Q2013, mainly due to higher oil production and deliveries.
Adjusted EBITDA per boe increased by 2% to $38.6 per boe in 3Q2014, mainly due to lower operating costs
per boe resulting from increased efficiency, which were partially offset by lower reference prices and higher
earn-out payments.
Operational Performance:
During 3Q2014, in the Llanos 34 Block (GeoPark operated with a 45% WTI), the Tigana Sur Oeste 1 and
Tigana Sur 2 wells were successfully tested and put on production.
In October 2014, GeoPark disclosed internal estimates for the Tigana oil field of approximately 140 – 170
mmbo OOIP and 3P PRMS gross reserves of 45-65 mmbo. The Company has installed facilities and
infrastructure to handle approximately 20,000 barrels of fluid per day (“bfpd”) (with plans underway to
expand to 100,000 bfpd).
Further details were provided in the recent release of October 21, 2014 and October 29, 2014.
Operations in Chile
Key Indicators 3Q2014 3Q2013 % Chg.
Oil production (bopd) 3,721 4,024 -8%
Gas production (mcfpd) 13,637 10,825 26%
Average net production (boepd) 5,994 5,829 3%
Net Revenues ($ million) 37.7 36.5 3%
Production Costs ($ million) -20.8 -16.1 29%
Adjusted EBITDA ($ million) 20.2 21.3 -5%
Adjusted EBITDA per boe ($) 40.8 39.5 3%
Operating Netback per boe ($) 50.2 49.9 0%
Production: Production in Chile increased by 3% to 5,994 boepd in 3Q2014 compared to 5,829 boepd in
3Q2013, mainly due to 26% higher gas production together with 8% lower oil production, resulting mainly
from the natural decline in base production.
Average production in Fell Block amounted to 5,752 boepd during 3Q2014, representing 96% of GeoPark’s
Chilean production, with the remaining production coming from GeoPark’s Tierra del Fuego blocks.
Net Revenues: Net revenues in Chile increased by 3% to $37.7 million for 3Q2014, representing 29% of
consolidated net revenues, compared to $36.5 million, or 41% of consolidated net revenues in 3Q2013.
Oil revenues decreased by 2% to $31.6 million in 3Q2014 due to lower production.
The average realized oil price increased 1% to $90 per barrel in 3Q2014. The Company’s new oil treatment
facilities allowed for quality improvements and lower price discounts, which fully offset the reduction of $8
per barrel in the reference price as compared to 3Q2013.
Oil revenues represented 84% of total net revenues in Chile in 3Q2014 compared to 88% in 3Q2013.
Gas revenues increased by 42% to $6.1 million in 3Q2014. The increase was mainly due to the 44%
increase in the average realized gas price resulting from (i) an improved agreement with the Fell Block gas
purchaser, Methanex, and, to a lesser extent, due to (ii) new gas deliveries from recent discoveries in the
Tierra del Fuego blocks, which are sold at higher prices. Gas revenues represented 16% of total net
revenues in Chile in 3Q2014 compared to 12% in 3Q2013.
As a reference, Methanex, GeoPark’s principal gas buyer, temporarily idled its plant from May until
September 2014 due to an insufficient supply of natural gas from its other suppliers. Chilean gas revenues
represented 5% of consolidated revenues in 3Q2014.
Costs: Production costs in Chile in 3Q2014 increased by 29% to $20.8 million, resulting in a 31% increase
in production costs per boe to $42.0. This was mostly due to higher depreciation charges per boe and the
impact on fixed costs from lower oil production, the startup of the Tierra del Fuego Blocks and, to a lesser
extent, higher costs from the operation of electrical submersible pumps and from chemical treatments to
improve oil quality. Additionally, operating costs increased by 19% to $10.2 million in 3Q2014 from $8.6
million in 3Q2013 while operating costs per boe increased by 21% to $20.7.
Exploration expenses in Chile amounted to $0.7 million in 3Q2014 compared to $0.6 million in 3Q2013.
Administrative costs in Chile decreased to $3.9 million in 3Q2014 compared to $4.0 million in 3Q2013.
Selling expenses in Chile decreased to $0.8 million in 3Q2014 from $0.9 million in 3Q2013.
Adjusted EBITDA: Adjusted EBITDA in Chile decreased by 5% to $20.2 million in 3Q2014, compared to
$21.3 million in 3Q2013, mainly due to increased operating costs, partially offset by higher revenues.
Adjusted EBITDA per boe increased by 3% to $40.8 per boe in 3Q2014 compared to $39.5 per boe in
3Q2013.
Operational Performance:
During 3Q2014, the Company advanced its exploration and development work program with the drilling of
five wells in the Fell Block (GeoPark operated with a 100% WI), and the drilling of two wells in the
Campanario Block (GeoPark operated with a 50% WI). Following the drilling program in the Tierra del Fuego
blocks, GeoPark and its partner ENAP have declared commerciality on seven new fields, allowing the
development phase to begin.
Further details were provided in the recent Operations Update release of October 21, 2014.
Operations in Brazil
Key Indicators 3Q2014 3Q2013* % Chg.
Oil production (bopd) 56 – N/A
Gas production (mcfpd) 20,882 – N/A
Average net production (boepd) 3,536 – N/A
Net Revenues ($ million) 15.3 – N/A
Production Costs ($ million) -6.6 – N/A
Adjusted EBITDA ($ million) 8.3 -0.9 N/A
Adjusted EBITDA per boe ($) 27.6 – N/A
Operating Netback per boe ($) 38.1 – N/A
* 3Q2013 shows only Adjusted EBITDA corresponding to expenses from the start-up of GeoPark’s Brazilian
operations, including personnel, legal and administrative costs. The Company completed the acquisition of its
interest in the Brazilian Manati Field on March 31, 2014. As of that date, GeoPark started consolidating line by
line its results of operations for accounting purposes within its Brazilian operations.
Production: Production for the Brazilian operations averaged 3,536 boepd in 3Q2014, composed of
approximately 98% gas and 2% condensate.
Net Revenues: The Brazilian operations represented 12% of the total consolidated net revenues in 3Q2014,
and amounted to $15.3 million. The average gas price, net of taxes, amounted to $7.9 per mcf ($47.5 per
boe) in 3Q2014.
Costs: Production costs in Brazil were $6.6 million in 3Q2014, reflecting production costs per boe of $22.1.
In addition, operating costs per boe amounted to $5.4.
Adjusted EBITDA: Adjusted EBITDA in Brazil reached $8.3 million in 3Q2014, representing 12% of
consolidated Adjusted EBITDA. Adjusted EBITDA per boe was $27.6 in 3Q2014.
Operational Performance:
During 3Q2014, Petrobras, the operator of the Brazilian Manati Field, continued the construction of a
compression plant that is expected to commence operations in 2H2015. The plant is expected to maximize
the recovery of the gas reserves of the Manati Field, and offset the natural production decline.
Also in 3Q2014, GeoPark initiated seismic registration in the Reconcavo basin, and topographic surveys in
the Potiguar basin, both part of the Round 11 blocks obtained in 2013 (GeoPark operated with 100% WTI).
The seismic program is expected to be completed by 4Q2014 with drilling expected to begin in 2H2015.
Further details were provided in the recent Operations Update release of October 21, 2014.
Operations in Argentina
Operations in Argentina represented approximately 1% of consolidated net revenues and Adjusted EBITDA,
respectively in both 3Q2014 and 3Q2013.
CONSOLIDATED NON-OPERATING RESULTS AND PROFIT FOR THE PERIOD
Net Financial Expenses: Net financial expenses increased to $20.6 million in 3Q2014 from $6.6 million in
3Q2013, mainly resulting from $13.9 million non-cash exchange rate losses resulting from the impact of the
depreciation of the Brazilian Reais in 3Q2014 over dollar-denominated net debt taken at the local subsidiary
level, where the functional currency is the Brazilian Reais. Additionally, consolidated net financial expenses
were impacted by higher average indebtedness as a result of the credit facility of $70.5 million obtained on
March 31, 2014 to acquire the interest in the Brazilian Manati Field. The above-mentioned effects were
partially offset by higher financial income resulting from higher cash and cash equivalents position (including
net proceeds resulting from the NYSE IPO in February 2014).
Income Tax: Income tax amounted to $6.2 million in 3Q2014 compared to $5.2 million in 3Q2013, in line
with the increase in profits before income taxes in 3Q2014.
Profit: Profit for the period increased 9% and amounted to $11.9 million in 3Q2014 compared to $11.0
million in 3Q2013, mainly due to higher operating income partially offset by higher net financial expenses,
and higher income taxes.
BALANCE SHEET
Cash and cash equivalents as of September 30, 2014, totaled $128.8 million, while at year-end 2013 cash
and cash equivalents amounted to $121.1 million. The increase is primarily due to cash generation from
operations during the nine-month period ended September 30, 2014, amounting to $164.2 million, along
with $125.2 million of funds generated from financing activities, which are mainly explained by (i) the credit
facility taken in Brazil, and (ii) $90.9 million net proceeds resulting from the NYSE IPO, minus (iii) $40.9
million related to debt and interest payments. During the period, net cash used for investment activities
totaled $279.7 million and included the Company’s capital expenditures program as well as the acquisition of
an interest in the Brazilian Manati Field.
Total assets as of September 30, 2014, reached $1,096.3 million. Additionally, total investments for the
nine-month period, ended September 30, 2014, mainly included (i) $122.5 million invested in Chile, where
the Company drilled twenty-three wells and acquired 350 sqkm of 3D seismic surveys, and (ii) $53.7 million
invested in Colombia that mainly included the drilling of eighteen wells along with construction of facilities
for drilled wells. In addition, investing activities in 3Q2014 included $115.0 million related to the acquisition
of an interest in the Brazilian Manati Field (net of cash acquired) completed on March 31, 2014.
At the end of 3Q2014, GeoPark’s total financial debt amounted to $362.9 million, mainly including the 2020
Bond issued in February 2013 and the 5-year credit facility in Brazil for the acquisition of an interest in the
Brazilian Manati Field.
Equity reached $512.6 million and included minority interests of $107.8 million related to LG International’s
participation in the Chilean and Colombian operations. (LG International Corp., the Korean conglomerate
holds a 20% equity interest in GeoPark’s Colombian operations, a 20% equity interest in the Fell block and a
31% equity interest in the Tierra del Fuego blocks in Chile.) Equity as of September 30, 2014 increased by
$146.6 million as compared to December 31, 2013, mainly due to net proceeds from the NYSE IPO in
addition to profits from the nine-month period.
FINANCIAL RATIOS (*)
Amounts in $ million
Gross debt /
Year / Period Financial debt Cash position Adjusted coverade
EBITDA
3Q2013 296.2 104.8 2.2X 5.9x
2013 317.1 121.1 1.9x 4.3x
102014(**) 364.7 131.9 2.2X 4.9x
2Q2014 (***) 368.6 125.3 1.8x 6.0x
3Q2014 (***) 362.9 128.8 1.6x 6.7x
(*) Based on trailing 12 months financial results.
(**) Does not consider Adjusted EBITDA generated by the acquired interest in the Brazilian Manati Field.
(2%) Considers Adjusted EBITDA generated by the acquired interest in the Brazilian Manati Field only since 2Q2014.
GeoPark’s consolidated incurrence financial covenants agreed under the 2020 Bond indenture provide for:
e Leverage Ratio, defined as Gross debt to Adjusted EBITDA, lower than 2.75x for the year 2014 and
lower than 2.5x from 2015 onwards; and
e Interest Coverage Ratio, defined as Adjusted EBITDA divided by Interest Expenses, above 3.5x.
OTHER NEWS/RECENT EVENTS
AGM Results
GeoPark’s 2014 Annual General Meeting was held on September 11, 2014, and all matters presented were
approved.
Entry into Perú with the Acquisition of Morona Block
In October, GeoPark announced the acquisition of an interest in the Morona Block located in northern Peru
from Petroperu. GeoPark will assume the operatorship and a 75% working interest (“WI”), with Petroperu
retaining a 25% WI.
The Morona Block covers an area of 1.9 million acres in the Marañón Basin, one of the most prolific
hydrocarbon basins in Peru. The Morona Block contains the Situche Central oil field, which has been
delineated by two wells (with short term tests of approximately 2,400 and 5,200 bopd of 35-36* API oil
each) and by 3D seismic. The independent reservoir engineering firm, Ryder Scott, has certified proven and
probable (2P) reserves of 55 million barrels of oil (mmbo) for Petroperu.
In addition to the Situche Central field, the Morona Block has a large exploration potential with several high
impact prospects and plays – with exploration resources currently estimated to range from 200 to 600
mmbo. This important component of the project will significantly increase GeoPark’s overall inventory of
exploration resources and complement GeoPark’s growing reserve and cash flow base already established in
Colombia, Chile and Brazil.
The initial work program will be to put the Situche Central field into production through a long term test to
help determine the most effective overall development plan and to begin to generate cash flow. This initial
stage requires an investment of approximately $140 – 160 million and is expected to be completed within 18
to 24 months after closing. GeoPark will carry Petroperu during this initial phase.
The transaction is subject to customary conditions, which include the qualification of GeoPark by PeruPetro,
the Peruvian petroleum licensing agency, certain license modifications and a presidential decree.
Update on Tigana Field in Llanos 34 Block in Colombia
From well drilling and production information, 3D seismic mapping, and a field area size estimate of 3,000-
4,000 acres, GeoPark announced in October its preliminary internal original oil in place (OOIP) estimate of
140-170 million barrels of oil (mmbo) and preliminary internal 3P gross reserve estimate of 45-65 mmbo for
the Tigana oil field. Additional appraisal drilling will be required to delineate the Tigana field and, therefore,
these figures are preliminary and subject to change with new information. GeoPark operates and has a 45%
WI in the Llanos 34 Block.
The expanded Tigana field size represents increased value for GeoPark by providing an important
opportunity to further grow production – with 30-45 potential new drilling locations. In addition to improving
the overall risk profile of GeoPark’s work program inventory, a larger field provides opportunities to reduce
drilling, operating and transportation costs by improved efficiencies. Even in lower oil prices environments,
the Tigana field is expected to generate significant operating cash flows. (As a reference, if WTI oil prices
average $75-85 per barrel, operating netbacks for the field are estimated to be approximately $40-50 per
barrel in 2015.)
New Block in Llanos Basin in Colombia
In November, GeoPark expanded its portfolio in Colombia through an agreement with SK Innovation
(subsidiary of SK Group, the Korean integrated energy and petrochemical company) to farm-in to the CPO-4
Block, located in the Llanos Basin (approximately 60 km away from the Company’s successful Llanos 34
Block). The block covers an area of approximately 345,600 acres (1,398 sq km) with 3D seismic coverage of
approximately 880 sq km. In accordance with the farm-in agreement, and subject to the approval of ANH in
Colombia, GeoPark will operate and receive a 50% WI in the CPO-4 Block in exchange for its commitment to
drill and fund its 50% WI (with no carry) of one exploration well. The well is targeted for 1H2015 and
GeoPark’s total financial commitment is approximately $6.0 million. There is an option to move to an
additional exploration phase following the drilling of a successful well. Final approval from the ANH is
expected in 1Q2015.
Potential Impact of Recent Decline in World Crude Oil Prices
Over the past three months, international oil prices have decreased by approximately 25%. Assuming this
scenario remains throughout 4Q2014, at current production levels the impact on GeoPark’s full year 2014
consolidated Adjusted EBITDA would be approximately 6 – 8% lower. Additionally, GeoPark is currently
finalizing its 2015 work program and capital expenditures plan and, as in the past, the official 2015 guidance
will be provided in January. The 2015 capital expenditures plan is expected to be within similar or lower
levels as in 2014, distributed throughout an expanded asset base with more countries and operations.
CONFERENCE CALL INFORMATION
GeoPark will host its Third Quarter 2014 results conference call and webcast on November 19, 2014, at
10:00 a.m. Eastern Standard Time.
Chief Executive Officer, James F. Park, Chief Operating Officer, Augusto Zubillaga, and Chief Financial
Officer, Andrés Ocampo, will discuss GeoPark’s financial and operating results for 3Q2014, with a question
and answer session immediately following.
Interested parties may access the conference call by dialing from outside the United States, +1 201-689-
8035 and from within the United States, +1 877-407-8035 (Passcode: GeoPark) or to listen to the webcast
by visiting the Investor Support section of the Company’s website (www.geo-park.com).
10
FIRST NINE-MONTHS 2014
The table below sets forth GeoPark’s production figures for the nine-month period ended September 30,
2014 (“9M2014”) compared with September 30, 2013 (“9M2013”).
9M2014(*) 9M2013
(espa) Oil (bopd) Gas (mcfpd) (oca) % Chg.
Chile 6,545 4,019 15,155 7,013 7%
Colombia 10,528 10,306 1,335 6.075 73%
Brazil 2,382 38 14,068 * N/A
Argentina 78 63 87 60 29%
Total 19,533 14,426 30,645 13,148 49%
* The acquisition of the interest in the Brazilian Manati Field was completed on March 31, 2014. As a reference and
only for comparison purposes, the corresponding net production in the Brazilian operations for 9M2014 amounted
to 3,591 boepd and for 9M2013 net production amounted to 3,721 boepd.
The table below sets forth some key indicators of performance for 9M2014, as compared with 9M2013.
Figures corresponding to 9M2014 include information relating to the acquired interest in the Brazilian Manati
Field completed on March 31, 2014. As from that date, GeoPark started consolidating line by line its results
of operations for accounting purposes within ¡ts Brazilian operations.
Key Indicators 9M2014 9M2013 % Chg.
Oil production (bopd) 14,426 10,816 33%
Gas production (mcfpd) 30,645 13,993 119%
Average net production (boepd) 19,533 13,148 49%
Average realized sales price
– Oil ($ per bbl) 85.7 82.5 4%
– Gas ($ per mcf) 7.1 4.6 54%
Net Revenues ($ million) 348.0 250.5 39%
Production Costs ($ million) -169.5 -129.8 31%
Adjusted EBITDA ($ million) 192.7 125.9 53%
Adjusted EBITDA per boe ($) 39.8 35.1 14%
Operating Netback per boe ($) 47.6 44.1 8%
Profit for the period ($ million) 49.6 25.2 97%
CONSOLIDATED OPERATING PERFORMANCE
Production: Consolidated production increased by 49% to 19,533 boepd in 9M2014 and is mainly explained
by increased production in the Colombian operations together with the addition of the Brazilian operations
(since 2Q2014), which were partially offset by lower production in the Chilean operations. On a proforma
basis, consolidated average production reached 20,742 boepd in 9M2014 and grew 23% compared to
16,869 boepd in 9M2013.
Net Revenues: Consolidated net revenues increased by 39% to $348.0 million in 9M2014 compared to
$250.5 million in 9M2013, primarily driven by increased oil production.
11
Consolidated Oil Revenues: Consolidated oil revenues represented 86% of total revenues in 9M2014
compared to 94% in 9M2013, increasing by 27% to $298.8 million in 9M2014, mainly due to increased
production, in addition to an increase in the average realized price of oil per barrel. The average realized oil
sales price increased 4% to $85.7 per barrel in 9M2014.
Consolidated Gas Revenues: Consolidated gas revenues represented 14% of total revenues in 9M2014
compared to 6% in 9M2013, representing an increase of 221% to $49.2 million in 9M2014 mainly related to
the addition of the Brazilian operations in the amount of $26.5 million and to a lesser extent, to higher
average gas prices in the Chilean operations. The consolidated average realized gas sales price increased
54% to $7.1 per mcf in 9M2014.
Costs: Consolidated production costs increased by 31% to $169.5 million in 9M2014, mainly driven by the
increase in production during the period and the addition of the Brazilian operations. Additionally, production
costs per boe decreased driven by improved fixed cost absorption from increased production.
Exploration costs amounted to $17.7 million in 9M2014 and $16.0 million in 9M2013.
Administrative costs increased by 14% to $36.6 million in 9M2014. This increase was primarily due to (i)
higher corporate expenses and new business efforts, and (ii) the addition of the Brazilian operations.
Selling expenses increased by 73% to $21.6 million in 9M2014, primarily due higher production and
deliveries in Colombia.
Adjusted EBITDA: Adjusted EBITDA increased by 53% to $192.7 million in 9M2014, primarily impacted by
higher Adjusted EBITDA in Colombian operations and, to a lesser extent, due to the addition of the Brazilian
operations.
Adjusted EBITDA per boe increased by 14% to $39.8 per boe in 9M2014 compared to $35.1 per boe in
9M2013, explained by higher average sales prices and the impact of lower operating costs per boe due to
improved fixed cost absorption and cost efficiencies, which were partially offset by a change in the revenue
mix with higher incidence of gas resulting from the Brazilian Manati acquisition.
CONSOLIDATED NON-OPERATING RESULTS AND PROFIT
Net Financial Expenses: Net Financial expenses increased from $27.2 million in 9M2013 to $31.7 million
in 9M2014, due to exchange rate differences resulting from the depreciation of the Brazilian currency and
increased interest expenses, due to higher average indebtedness, which were partially offset by one-time
expenses incurred as part of the prepayment of the 2015 Reg S Bond in February 2013 and higher interest
income related to increased cash and cash equivalents in 9M2013.
Income Tax: Income tax increased by 88% to $23.0 million in 9M2014, in line with increased profits before
income taxes.
Profit: Profit in 9M2014 increased by 97% to $49.6 million, as a result of higher operating results, which
were partially offset by higher net financial expenses and income taxes. Earnings per share increased by
83% to $0.66 per share in 9M2014, mainly driven by increased profits in the period.
GeoPark can be visited online at www.geo-park.com
For further information please contact:
Pablo Ducci – Director Capital Markets pducciOMgeo-park.com
Sofia Chellew – Investor Relations schellewOgeo-park.com
Santiago, Chile
T: +562 2242 9600
12
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
NET REVENUES
Sale of crude oil
Sale of gas
TOTAL NET REVENUES
Production costs
GROSS PROFIT
Exploration costs
Administrative costs
Selling expenses
Other operating income
OPERATING PROFIT
Financial results, net
PROFIT BEFORE INCOME TAX
Income tax
PROFIT FOR THE PERIOD
Non-controlling interest
ATTRIBUTABLE TO OWNERS OF GEOPARK
In millions of $, except for %
RECONCILIATION OF ADJUSTED EBITDA TO PROFIT BEFORE INCOME TAX
AND ADJUSTED EBITDA PER BOE
(Unaudited)
Adjusted EBITDA
Depreciation
Share Based Payments
Impairment and write-off
Others
OPERATING PROFIT
Financial results, net
PROFIT BEFORE INCOME TAX
Adjusted EBITDA
Total deliveries (in millions of boe)
Adjusted EBITDA per boe
RECONCILIATION OF GROSS PROFIT TO OPERATING NETBACK
AND OPERATING NETBACK PER BOE
(Unaudited)
Gross Profit
Plus: Depreciation and share based payments
Less: Selling Expenses
Operating Netback
Total deliveries (in millions of boe)
Operating Netback per boe
3Q2014 3Q2013 % 9M2014 9M2013 %
111.6 85.4 31% 298.8 235.2 27%
20.2 4.3 369% 49.2 15.3 221%
131.8 89.7 47% 348.0 250.5 39%
-67.5 -48.7 39% -169.5 -1298 31%
64.3 41.0 57% 178.5 120.7 148%
-3.4 -24 41% -17.7 -16.0 10%
-13.7 -11.3 21% -36.6 -32.1 14%
-9.3 4.9 92% -21.6 -12.5 73%
0.8 0.4 123% 1.8 4.6 -61%
38.7 22.8 70% 104.3 64.7 5%
-20.6 -6.6 210% -31.7 -27.2 16%
18.1 16.1 12% 72.6 37.5 9%
-6.2 -5.2 20% -23.0 -12.3 88%
11.9 11.0 9% 49.6 25.2 9%
3.5 3.8 -10% 12.7 9.4 34%
8.5 7.2 19% 36.9 15.8 134%
In millions of $, except for %
3Q2014 3Q2013 % 9M2014 9M2013 %
67.9 41.9 62% 192.7 125.9 53%
-27.1 -16.9 60% -72.8 -49.5 47%
-2.4 -2.5 -3% -8.0 -5.9 34%
0.0 -0,2 -95% -8.6 -12.0 -28%
0.3 0.5 -33% 1.1 6.2 -83%
38.7 22.8 70% 104.3 64.7 51%
-20.6 -6.6 210% -31.7 -27.2 16%
18.1 16.1 12% 72.6 37.5 924%
67.9 41.9 62% 192.7 125.9 53%
1.9 1.2 57% 4.838 3.589 35%
36.0 34.9 3% 39.8 35.1 14%
In millions of $, except for %
3Q2014 -3Q2013 % 9M2014 9M2013 %
64.3 41.0 57% 178.5 120.7 48%
27.1 17.2 57% 73.3 50.1 46%
-9.3 -4,9 92% -21.6 -12.5 73%
82.1 53.4 54% 230.1 158.3 45%
1.9 1.2 57% 4.8 3.6 35%
43.5 445 -2% 47.6 44.1 8%
13
CONSOLIDATED SUMMARIZED BALANCE SHEET
(Unaudited)
Non Current Assets
Property, Plant and Equipment
Other Non Current Assets
Total Non Current Assets
Current Assets
Inventories
Trade Receivables
Other Current Assets
Cash at bank and in hand
Total Current Assets
Total Assets
Equity
Equity attributable to owners of GeoPark
Non-controlling interest
Total Equity
Non Current Liabilities
Borrowings
Other Non Current Liabilities
Total Non Current Liabilities
Current Liabilities
Borrowings
Other Current Liabilities
Total Current Liabilities
Total Liabilities and Equity
Sept ’14
795.4
37.8
833.1
10.1
71.3
52.9
128.8
263.2
1,096.3
404.8
107.8
512.6
342.3
96.2
438.5
20.6
124.6
145.2
1,096.3
Dec ’13
595.4
36.3
631.8
8.1
42.6
42.7
121.1
214.6
846.4
270.8
95.1
366.0
290.5
64.5
355.0
26.6
98.9
125.5
846.4
SELECTED HISTORICAL OPERATIONAL AND FINANCIAL DATA
Oil Reserves (2P PRMS) – mmboe
Gas Reserves (2P PRMS) – mmboe
Combined Reserves (2P PRMS) – mmboe
Oil Production (thousand boepd)
Gas Production (thousand boepd)
Production (thousand boepd)
Oil Revenues ($ million )
Gas Revenues ($ million)
Total Revenues ($ million)
Adjusted EBITDA ($ million)
2013
33.9
27.7
61.6
11.1
2.4
13.5
315
23
338
167
Year ended December 31,
2012
27.8
29.1
56.9
222
29
250
121
o
34%
4%
32%
25%
67%
24%
6%
23%
30%
49%
13%
40%
18%
49%
24%
-23%
26%
16%
30%
In millions of $, except for %
2011
16.9
32.6
49.5
74
38
112
63
2010
16.2
33.4
49.6
1.9
5.0
6.9
48
31
so
41
2009
10.9
31.3
42.2
14
GLOSSARY
Adjusted EBITDA
Adjusted EBITDA per boe
Operating Netback per boe
ANP
ANH
boe
boepd
bopd
CEOP
EPS
IPO
mbbl
mmboe
mcfpd
mmcfpd
Mm/day
PRMS
SPE
wI
NPVi0
Sqkm
Profit for the period before net finance cost, income tax,
depreciation, amortization, certain non-cash items such as
impairments and write offs of unsuccessful efforts, accrual of stock
options and stock awards and bargain purchase gain on acquisitions
of subsidiaries
Adjusted EBITDA divided by total boe deliveries for the applicable
period
Net revenues, less production costs (net of depreciation charges and
accrual of stock options and stock awards) and selling expenses,
divided by total boe deliveries. Operating Netback is equivalent to
Adjusted EBITDA net of cash expenses included in Administrative,
Exploratory and Other operating costs.
Agéncia Nacional do Petróleo, Brazil’s National Agency of Petroleum
Agencia Nacional de Hidrocarburos de Colombia
Barrels of oil equivalent
Barrels of oil equivalent per day
Barrels of oil per day
Contrato Especial de Operacion Petrolera (Special Petroleum
Operations Contract)
Earnings per share
Initial Public Offering
Thousand barrels of oil
Million barrels of oil equivalent
Thousand cubic feet per day
Million cubic feet per day
Thousand cubic meters per day
Petroleum Resources Management System
Society of Petroleum Engineers
Working interest
Present value of estimated future oil and gas revenues, net of
estimated direct expenses, discounted at an annual rate of 10%
Square kilometers
15
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,
“potential,” among others.
ma
intend,” “will,” “estimate” and
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 2014 production growth 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.
Information about oil and gas reserves: The SEC permits oil and gas companies, in their filings with
the SEC, to disclose only proved, probable and possible reserves that meet the SEC’s definitions for such
terms. GeoPark uses certain terms in this press release, such as “PRMS Reserves” that the SEC’s guidelines
do not permit GeoPark from including in filings with the SEC. As a result, the information in the Company’s
SEC filings with respect to reserves will differ significantly from the information in this press release.
NPV10 for PRMS 1P, 2P and 3P reserves ¡is not a substitute for the standardized measure of discounted
future net cash flows for SEC proved reserves.
Adjusted EBITDA: The Company defines Adjusted EBITDA 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 and bargain
purchase gain on acquisition of subsidiaries. Adjusted EBITDA is not a measure of profit or cash flows as
determined by IFRS. The Company believes Adjusted EBITDA is useful because it allows us to more
effectively evaluate our operating performance and compare the results of our operations from period to
period without regard to our financing methods or capital structure. The Company excludes the items listed
above from profit for the period in arriving at Adjusted EBITDA because these amounts can vary
substantially from company to company within our industry depending upon accounting methods and book
values of assets, capital structures and the method by which the assets were acquired. Adjusted EBITDA
should not be considered as an alternative to, or more meaningful than, profit for the period or cash flows
from operating activities as determined in accordance with IFRS or as an indicator of our operating
performance or liquidity. Certain items excluded from Adjusted EBITDA are significant components in
understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax
16
structure and significant and/or recurring write-offs, as well as the historic costs of depreciable assets, none
of which are components of Adjusted EBITDA. The Company’s computation of Adjusted EBITDA may not be
comparable to other similarly titled measures of other companies. For a reconciliation of Adjusted EBITDA to
the IFRS financial measure of profit for the year or corresponding period, see the accompanying financial
tables.
Operating netback per boe should not be considered as an alternative to, or more meaningful than, profit for
the period or cash flows from operating activities as determined in accordance with IFRS or as an indicator
of our operating performance or liquidity. Certain items excluded from Operating netback per boe are
significant components in understanding and assessing a company’s financial performance, such as a
company’s cost of capital and tax structure and significant and/or recurring write-offs, as well as the historic
costs of depreciable assets, none of which are components of Operating Netback per boe. The Company’s
computation of Operating Netback per boe may not be comparable to other similarly titled measures of
other companies. For a reconciliation of Operating Netback per boe to the IFRS financial measure of profit
for the year or corresponding period, see the accompanying financial tables.
17
Link al archivo en CMFChile: https://www.cmfchile.cl/sitio/aplic/serdoc/ver_sgd.php?s567=31d04e53eddf3918ca6905bde7f2f515VFdwQmVFNUVSWGhOUkVWNlRXcFpORTVCUFQwPQ==&secuencia=-1&t=1682366909
