GeoPark's Q3 2025: Contradictions Emerge on Colombia Reserves, Argentina Acquisitions, and Production Growth

Date of Call: November 6, 2025

Financials Results

• Operating Margin: 57% adjusted EBITDA margin, broadly stable versus the second quarter (Adjusted EBITDA USD 71.4M)

Guidance:

• 2026 CapEx base case $50M–$70M, fully funded (local Argentine credit lines up to $100M; potential to lower via third‑party capacity)
• 2026 work program and investment guidance to be released before year-end
• 2030 base case targets: production 42,000–46,000 boe/d; adjusted EBITDA $520M–$550M; net leverage 0.8–1.0
• Dividend program: ~USD 6M over next 4 quarters (~$0.03/sh/quarter) starting 3Q25; dividends suspended from 3Q26 while Argentina investments peak
• Hedging: ~62% of expected 2026 production protected via 3‑way collars (floors $65/$50; avg ceiling $73)

Business Commentary:

* Strategic Expansion in Argentina:

- GeoPark successfully closed the acquisition of high-quality blocks in Vaca Muerta, Neuquén, securing full operational control of Loma Jarillosa Este and Puesto Silva Oeste.
- This entry into one of the world's most promising unconventional basins positions GeoPark for long-term growth and diversification.

• Operational Performance and Production Growth:
• GeoPark reported average consolidated production of 28,136 barrels of oil equivalent per day in Q3, exceeding 2025 guidance and up nearly 3% quarter-over-quarter.

• The growth was driven by strong performance in core operated and nonoperated assets in Colombia, particularly Llanos 34, and efficient cost management across operations.

• Financial Performance and Capital Allocation:

• Adjusted EBITDA reached USD 71.4 million with a 57% margin, stable compared to the previous quarter, supported by high volumes and steady realized prices.

• GeoPark invested USD 17.5 million during the quarter, mainly for sustaining and enhancing production in Llanos 34 and advancing exploration across Colombia.

• Reserve Replacement and Reserve Life:

• GeoPark is on track to achieve over 100% of reserves replacement for the year, indicating strong reserve growth potential.

• This is attributed to operational efficiencies, exploration successes, and the acquisition of reserves in Vaca Muerta.

• Dividend Strategy and Shareholder Returns:

• The Board of Directors approved a revised dividend program totaling approximately USD 6 million over the next 4 quarters, reflecting a commitment to shareholder returns.
• Dividends will be reviewed as investments in Argentina peak and investments return to positive free cash flow.
  

  Sentiment Analysis:

  Overall Tone: Positive

  • Management highlighted a "solid third quarter," adjusted EBITDA of USD 71.4M with a 57% margin, net income of USD 15.9M vs. prior quarter loss, $197M cash, repurchases reducing interest costs, and a transformational Vaca Muerta acquisition expected to add material EBITDA and production upside; guidance and financing for 2026 CapEx described as fully funded.

Q&A:

• Question from Joaquin Robet (Balanz Capital): My question is regarding the 2026 Vaca Muerta work program. Could you provide more color on the upcoming studies and permits, their timing and whether the associated CapEx and commitments are fully funded?
  Response: Immediate interventions (artificial lift/workovers) will lift Vaca Muerta to ~1.6–1.7k bpd in short order; permits to be submitted by Q1 2026; base‑case 2026 CapEx is $50–$70M and is fully funded via local credit lines (up to $100M) with options to optimize costs by using neighbors' capacity.

• Question from Eduardo Muniz (Santander): In Colombia, could you comment on the lower CapEx for this quarter and give us an update regarding production and the stage of exploratory campaigning in Llanos Basin? Also, can you update on how the infill campaign is progressing relative to cost/performance targets and timeline? In CPO-5, could you provide more detail to us about the commercial agreement with BP that started in August? How did this impact oil discounts and transportation cost? Regarding reserves, we will see major changes given divestments, VM acquisition and positive results from exploratory wells. So how do you view your reserves and reserve life? What increment should we see in reserves? In Argentina, could you comment on the current phase you're at in terms of operations? How complex and the timing for getting regulatory permits to start building your own infrastructure? You closed the transaction in VM, has the cash disbursement been done? What was the final?
  Response: Q3 CapEx of ~$17.5M reflected one rig (vs. $25–27M prior with two rigs); Q4 will ramp to more rigs. Infill in Llanos 34 outperformed (2,600 bpd from six wells; wells cost $2.9M, ~30% below prior year). CPO‑5 BP deal (6.5k bpd scope, 12 months) adds export/blend optionality via Covenas, yields ~$4–$5/BBL discount vs Brent and includes a $50M prepayment facility. Reserves directionally positive—targeting >100% organic replacement for the year. Argentina transaction closed for $115M; permits for VM to be submitted Q1 2026 (3–6 months approval typical).

• Question from Stephane Guy Foucaud (Auctus Advisors): In Colombia, I was wondering whether there will be any anti-competition restriction from the regulator, the government, with regards to when a player becomes too large or perhaps too much in a certain region?
  Response: Colombian competition rules and other local regulatory requirements would apply to any deal; the company will consider such rulings but will not speculate on outcomes.

• Question from Daniel Guardiola (BTG): How would you rank on a risk-adjusted basis your value-accretive growth opportunities between both countries? And can you provide any sort of indication of the expected NPV of the recently acquired assets of Argentina, assuming everything goes in line with the plan?
  Response: Vaca Muerta is highly accretive—management expects ~20k bpd and roughly $300–$350M incremental EBITDA over 3–4 years; portfolio capital allocation targets double‑digit returns at a 15% discount rate and $60 Brent; a specific NPV was not provided at this time.

• Question from Vicente Falanga (Bradesco): What are the risks related to your polymer injection project in Llanos 34? What could go wrong? What are the key operational milestones in terms of well results for the GeoPark to derisk its Argentina operations?
  Response: Polymer injection is a proven technology; managed risks include subsurface uncertainty, execution and economics, addressed via phased rollout (2 wells end‑2025, ~9 wells in 2026, ~30 patterns full development) and experienced hires—first injections expected in months. Argentina blocks are geologically proven with partially drilled pads to reduce drilling risk and expected well EURs ~1.1–1.3MM barrels, supported by local neighborhood data and experienced operational team.

• Question from Isabella Pacheco (BofA Securities): How much do you expect the Vaca Muerta acquisition will add to your 4Q '25 production?
  Response: For the ~75 days of ownership in 4Q25, Vaca Muerta will add approximately 1,400–1,600 bpd to the quarter.

• Question from Alejandro Anibal Demichelis (Jefferies): Maybe you can give us some indication of the rationale for keeping the poison pill still in place at this moment.
  Response: The poison pill remains to ensure any bidder pays a fair premium that reflects company value and benefits all shareholders; the Board supports keeping it given recent shareholder accumulation and ongoing process.

Contradiction Point 1

Production and Reserve Life Expectations in Colombia

It involves differing expectations regarding production and reserve life in Colombia, which are critical for understanding the company's growth and sustainability.

How do you view your reserves and reserve life? How are operations in Argentina progressing, and what is the status of cash disbursements for the VM acquisition? - Eduardo Muniz (Santander)

2025Q3: Jaime, on reserves: We don't see major changes from divestments, Vaca Muerta acquisition positively impacts reserves. - Jaime Caballero Uribe(CFO)

Can you detail your plans to extend P1 reserves' lifespan? How are you approaching reserves replacement, and what portion is expected to come from organic versus inorganic efforts? - Joaquin Robet (Unidentified Company)

2025Q2: Colombia's 2P reserves could sustain operations until the end of the decade. - Felipe Bayon Pardo(CEO & Director)

Contradiction Point 2

Inorganic Growth Opportunities in Argentina

It involves differing views on the attractiveness and risk profile of inorganic growth opportunities in Argentina, which impact strategic decision-making and investor expectations.

How do you prioritize value-accretive growth opportunities between Colombia and Argentina on a risk-adjusted basis? What is the expected NPV of the recently acquired assets in Argentina? - Daniel Guardiola (Banco BTG Pactual S.A.)

2025Q3: Argentina's Vaca Muerta acquisition is accretive with potential $300-$350 million EBITDA in next 3-4 years. NPVs are competitive at a 15% discount rate and $60 Brent price, supporting double-digit returns. - Felipe Bayon Pardo(CEO & Director)

Can you provide examples of areas for improvement? Also, can you update us on inorganic growth initiatives, particularly in Argentina? - Alejandro Anibal Demichelis (Jefferies LLC)

2025Q2: Argentina's light oil assets are relatively deepwater and of marginal value. These assets are not attractive in a $50 Brent world. - Felipe Bayon Pardo(CEO & Director)

Contradiction Point 3

Argentina Acquisition and Integration

It addresses the strategic significance and operational challenges associated with the acquisition and integration of assets in Argentina, which are key to the company's growth strategy.

How do you rank your value-accretive growth opportunities in Colombia versus Argentina in terms of risk-adjusted value? What is the expected NPV of Argentina's newly acquired assets? - Daniel Guardiola (Banco BTG Pactual S.A.)

2025Q3: Felipe Bayon: Argentina's Vaca Muerta acquisition is accretive with potential $300-$350 million EBITDA in next 3-4 years. NPVs are competitive at a 15% discount rate and $60 Brent price, supporting double-digit returns. - Felipe Bayon Pardo(CEO & Director)

How do you view the situation regarding CapEx and production growth in the current oil price environment? - Alejandro Anibal Demichelis (Jefferies)

2025Q1: Andrés Ocampo: Despite persistent market volatility and Brent fluctuations, we delivered solid results while preserving flexibility to pursue value-accretive opportunities. - Andrés Ocampo(CEO)

Contradiction Point 4

Argentina Production Growth Strategy

It highlights differing expectations for production growth in Argentina, which affects investment decisions and operational planning.

How much will the Vaca Muerta acquisition add to 4Q '25 production? - Isabella Pacheco (BofA Securities)

2025Q3: For the 75 days of production in Vaca Muerta, it will contribute approximately 1,400-1,600 barrels of oil per day for Q4 '25. - Martin Terrado(COO)

How should we expect Argentina's output to evolve in 2025? Are there any current well-related challenges? - Vicente Falanga (Bradesco)

2024Q4: The company's strategy is to grow production in Argentina, reaching 20,000 barrels per day by mid-2025 with one rig and 40,000 barrels per day with a second rig by early 2026. - Martin Terrado(COO)