GeoPark announces divestments of non-core assets in Colombia and Brazil

GeoPark, an energy company operating in Latin America, has announced the divestment of non-core assets and the implementation of cost efficiency initiatives.

The company aims to streamline operations and focus on sustainable long-term growth through the divestments.

It is divesting its non-core Llanos 32 Block in Colombia and the Manati gas field in Brazil for a total consideration of $20m.

This $20m amount features net of $12m in liabilities associated with decommissioning or retirement obligations for the Manati gas field.

Together, these assets had aggregate net 1P PRMS (Petroleum Resources Management System) reserves of 2.9 million barrels of oil equivalent (mboe), comprising 60% oil and 40% natural gas, by the end of 2024 and an average production of 712 barrels of oil equivalent per day (boepd) last year.

These assets represented around 1,500boepd in this year’s plan, with an associated adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation) of $10–13m at $70–80 per barrel (bbl) Brent.

Last month, GeoPark agreed to transfer, pending regulatory approval, its non-operated working interest in the Llanos 32 Block to its joint operation partner, Parex Resources. The total consideration for this transaction is $19m, without working capital adjustment of $3.7m.

GeoPark has already received the net proceeds from the deal, which are pending final settlement.

Towards the end of last month, GeoPark entered into an agreement to divest its 10% non-operated working interest in the Manati gas field in Brazil for a total of $1m, along with adjustments for working capital and a contingent payment linked to the field's future cash flow or its possible conversion into a natural gas storage facility.

Under this transaction, GeoPark will also transfer all related obligations including decommissioning liabilities.

Last year, in September, a restricted deposit of $12m associated with these obligations was recovered in cash and subsequently replaced with a bank guarantee.

Completion of the deal is subject to customary regulatory approvals and expected during the third quarter of 2025.

The gas field had net 1P PRMS reserves of 1mboe, with 99% being natural gas, at the end of 2024. Net production from the field averaged 222boepd in 2024.

Meanwhile, GeoPark is looking at strategic options for its assets in Ecuador.

GeoPark is also actively pursuing targeted cost reduction and efficiency measures, which are expected to yield annual savings of around $5–7m in operational and general and administrative expenses. These initiatives involve immediate structural adjustments including workforce reductions as well as cuts to consultants, contractors and various administrative costs.