GRAN TIERRA ENERGY INC.
For the period ended Jun 30, 2026. Filed Aug 5, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 5, 2026
GTE$9.42+0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-08.
0001273441-26-000015
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-05.
0001273441-26-000028
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 129 previous paragraphs and 138 current paragraphs.
47 unchanged; 59 reworded; 32 added; 20 removed; 3 previous and 0 current paragraphs rearranged.
Tables are not compared: 47 previous and 47 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (32)
Current report
•Funds flow from operations(2)increased to $60.3 million compared to $53.9 million in the second quarter of 2025, and $42.8 million in the prior quarter
Current report
•Oil, natural gas and NGL sales for the second quarter of 2026 increased by 25% to $187.2 million, compared to the second quarter of 2025, due to increase in benchmark oil prices, offset by lower sales volumes in Colombia and Canada and higher quality and transportation discounts in Colombia associated with using alternative transportation routes for Putumayo production as the Colombia and Ecuador border remained closed. Oil, natural gas and NGL sales increased by 9% from $172.1 million in the prior quarter due to higher benchmark oil prices and lower quality and transportation discounts in Colombia and premium in Ecuador, partially offset by lower sales volumes
Current report
•Operating expenses decreased by 7% and 22% to $51.6 million when compared to the second quarter of 2025 and the prior quarter, respectively, primarily due to lower workover activities, reduced field personnel costs, lower oil treatment and testing service costs, as well as inventory fluctuations resulting from inventory accumulation at the end of the current quarter. On a per boe basis, operating expenses increased by $1.67 to $17.61 when compared to the second quarter of 2025 due to lower sales volumes and decreased by $0.64 from $18.25 in the prior quarter primarily due to inventory fluctuations resulting from inventory accumulation at the end of the current quarter
Current report
•Transportation expenses decreased by 13% when compared to the second quarter of 2025 and decreased by 26% from the prior quarter primarily due to lower sales volumes transported in Colombia and Canada
Current report
•Operating netback(2)was $131.7 million compared to $89.3 million in the second quarter of 2025 and $100.6 million in the prior quarter
Current report
•Quality and transportation discounts per boe in South America were $10.47, an increase from $10.29 in the second quarter of 2025 due to higher transportation discounts in Colombia. Quality and transportation discounts in Colombia were affected by using alternative transportation route for Putumayo production as a result of closure of Ecuador and Colombia border which was significantly more expensive and resulted in approximately $5.9 million for the current quarter. Quality and transportation discounts in South America decreased from $19.04 per boe in the prior quarter primarily a result of decrease in Vasconia and Oriente differentials, offset by higher transportation discounts
Current report
•General and administrative (“G&A”) expenses before stock-based compensation for the second quarter of 2026 decreased to $13.2 million compared to $14.1 million in the second quarter of 2025 and $15.1 million in the prior quarter due to lower consulting, information technology costs and lower salaries associated with headcount optimization
Current report
Brent -For the three and six months ended June 30, 2026, Brent increased 45% and 24% from the corresponding periods of 2025 and increased 23% from the prior quarter.
Current report
For the three months ended June 30, 2026, Castilla differential per bbl increased to $9.71 from $4.73 in the corresponding period of 2025. Vasconia and Oriente differentials per bbl decreased to $1.42 and $2.01 compared to $1.71 and $7.26, respectively, in the corresponding period of 2025.
Current report
For the six months ended June 30, 2026, Castilla and Vasconia differentials per bbl increased to $9.69 and $3.65 from $5.04 and $1.99, respectively, in the corresponding period of 2025. Oriente differential per bbl decreased to $5.07 from $7.45 in the corresponding period of 2025.
Current report
Castilla differential per bbl was comparable to the prior quarter and Vasconia and Oriente differentials per bbl decreased from $5.91 and $8.17 in the prior quarter.
Current report
The differentials for South America fluctuate based on regional supply and demand of heavy crude, shipping costs, pipeline disruptions and geopolitical and trading policies.
Current report
Oil, natural gas and NGL salesfor the three and six months ended June 30, 2026, increased by 25% and 13% to $187.2 million and $359.2 million compared to the corresponding periods of 2025, primarily due to increases of 45% and 24% in Brent price, partially offset by 16% and 6% lower sales volumes in Colombia and Canada and higher quality and transportation discounts in Colombia. Quality and transportation discounts in Colombia were affected by using alternative transportation route for Putumayo production as Colombia and Ecuador border remained closed. The alternative transportation route was significantly more expensive and resulted in approximately $5.9 million and $10.0 million for the three and six months ended June 30, 2026.
Current report
Compared to the prior quarter, oil, natural gas and NGL sales increased by 9%, primarily due to a 23% increase in Brent price and lower quality and transportation discounts in Colombia and premium in Ecuador, partially offset by a 20% decrease in sales volumes. During three months ended June 30, 2026, there was only one lifting in Ecuador compared to two in the prior quarter.
Current report
(*)Same as DD&A expenses for the three months ended June 30, 2026 and 2025, six months ended June 30, 2026 and 2025, and the prior quarter (the depreciation of administrative assets had a de minimus amount for all reported periods).
Current report
(1) Operating netback is a non-GAAP measure that does not have any standardized meaning prescribed under GAAP. Refer to footnote 2 “Non-GAAP measures” in “Financial and Operational Highlights” for a definition and reconciliation of this measure.
Current report
Operating expenses for the three and six months ended June 30, 2026, decreased by 7% and 4% to $51.6 million and $117.7 million, respectively, compared to the corresponding periods of 2025. The decrease was primarily due to lower workover activities, reduced field personnel costs, lower oil treatment and testing service costs, as well as inventory fluctuations resulting from inventory accumulation at the end of the current quarter.
Current report
Operating expenses for the three and six months ended June 30, 2026, on a per boe basis, increased by $1.67 and $0.44 to $17.61 and $17.97, respectively, compared to the corresponding periods of 2025, primarily due to lower sales volumes during current periods, partially offset by $0.18 and $0.68 per boe lower workover activities and inventory fluctuations, respectively.
Current report
Compared to the prior quarter, operating expenses decreased by 22% from $66.1 million or by$0.64 from $18.25 on a per boe basis primarily due to inventory fluctuations resulting from inventory accumulation at the end of the current quarter, partially offset by$0.34 per boe higher workover activities.
Current report
Transportation expenses for the three months ended June 30, 2026, decreased by 13% to $3.9 million, compared to the corresponding period of 2025, due to lower sales volumes transported in Colombia and Canada and increased by $0.04 per boe due to lower sales volumes. Transportation expenses for the six months ended June 30, 2026, increased by 2% or $0.12 per boe due to higher volumes transported via pipeline which had a higher cost per boe.
Current report
Transportation expenses decreased by 26% or $0.13 per boe from $5.3 million or $1.46 per boe in the prior quarter due to lower sales volumes transported during the current quarter.
Current report
G&A expenses before stock-based compensation for the three months ended June 30, 2026, decreased by 6% to $13.2 million compared to the corresponding period of 2025, primarily due to lower consulting and information technology costs during the current period. G&A expenses before stock-based compensation for the six months ended June 30, 2026, increased by 9% to $28.4 million, compared to the corresponding period of 2025, primarily due to higher costs associated with project optimization.
Current report
On a per boe basis, G&A expenses before stock-based compensation for the three and six months ended June 30, 2026 increased by $0.47 and $0.61 to $4.52 and $4.33, compared to the corresponding period of 2025 primarily due to 16% and 6% lower sales volumes, respectively.
Current report
Compared to the prior quarter, G&A expenses before stock-based compensation decreased by 13% due to lower consulting, information technology costs and lower salaries associated with headcount optimization. On a per boe basis, G&A expenses before stock-based compensation increased by $0.34 compared to the prior quarter due to 20% decrease in sales volumes.
Current report
The deferred income tax for the six months ended June 30, 2025, was a recovery of $2.3 million primarily attributable to an increase in deductible temporary differences arising from tax losses generated during the period. This recovery was partially offset by temporary differences related to accelerated tax depreciation in excess of accounting depreciation.
Current report
During the three months ended June 30, 2026, we spud one development well in Cohembi field in Colombia which was producing as of June 30, 2026.
Current report
During the three and six months ended June 30, 2026, we drew nil and $166.5 million on oil prepayment and re-paid $28.8 million of the outstanding principal on oil prepayment via crude oil deliveries.
Current report
Assets exchange transaction
Current report
During the three months ended June 30, 2026, we completed an asset exchange transaction in which we transferred a 30% WI in certain oil and natural gas rights, wells, and tangible assets located in the Marten Hills area, in exchange for oil and natural gas rights, wells, and tangible assets in the Seal/Dawson area, WI ranging from 35% to 100%. In connection with this transaction, we received cash consideration of C$0.8 million (US$0.6 million).
Current report
Disposition of Lodgepole area
Current report
During the three months ended June 30, 2026, we completed a disposition of 54% WI and associated title rights in the Lodgepole area in Canada effective January 1, 2026, for a total cash consideration of C$12.8 million (US$9.3 million). As part of disposition, we derecognized asset retirement obligation attributed to Lodgepole area totaling C$17.5 million (US$12.8 million) on an undiscounted basis and C$9.0 million (US$6.6 million) on a discounted basis. No gain or loss was recognized in the statement of operations as the disposal did not materially change the relationship between capital costs and the proved reserves of oil and natural gas assets.
Current report
(1)At the June 30, 2026 foreign exchange rate.
Removed paragraphs (20)
Previous report
•Funds flow from operations(2)decreased to $42.8 million compared to $55.3 million in the first quarter of 2025, and increased from $26.8 million in the prior quarter
Previous report
•Operating expenses decreased by 1% or $0.85 per boe to $66.1 million or $18.25 per boe when compared to the first quarter of 2025, due to lower workover activities, lower power generation and field personnel costs associated with head-count optimization partially offset by inventory fluctuations due to the sale of oil inventory accumulated at the end of the previous quarter. Operating expenses increasedby 16% or by$0.98 per boefrom$57.2 million or $17.27 per boe in the prior quarter primarily a result of inventory fluctuations due to the sale of oil inventory accumulated at the end of the previous quarter partially offset by lower workover activities and lower operating costs across various categories
Previous report
•Transportation expenses increased by 17% when compared to the first quarter of 2025 and increased by 44% compared to the prior quarter primarily due to higher sales volumes transported in Ecuador during the current quarter
Previous report
•Operating netback(2)was $100.6 million compared to $96.5 million in the first quarter of 2025 and $69.1 million in the prior quarter
Previous report
•Quality and transportation discounts per boe in South America increased for the first quarter of 2026 to $19.04 compared to $11.58 in the first quarter of 2025 and $12.30 in the prior quarter, due to higher differentials and transportation discounts. Higher transportation discounts were incurred due to utilizing alternative transportation route associated with Putumayo production in Colombia which was significantly more expensive and resulted in approximately $4.1 million for the current quarter
Previous report
•General and administrative (“G&A”) expenses before stock-based compensation for the first quarter of 2026 increased to $15.1 million compared to $11.9 million in the first quarter of 2025 due to higher consulting costs attributable to optimization projects and decreased from $16.8 million in the prior quarter due to headcount optimization measures implemented during the current quarter
Previous report
•During the first quarter of 2026 we entered into an exploration, development and production sharing agreement with the State Oil Company of the Republic of Azerbaijan, for the onshore Guba–Khazaryani region in Azerbaijan, expanding our international exploration portfolio
Previous report
Brent -For the three months ended March 31, 2026, Brent increased 5% from the corresponding period of 2025 and increased 24% from the prior quarter. For the three months ended March 31, 2026, Castilla, Vasconia and Oriente differentials per boe increased to $9.67, $5.91 and $8.17 compared to $5.34, $2.27 and $7.65, respectively, in the corresponding period of 2025. Additionally, the realized price for South America was effected by higher transportation discounts. Higher transportation discounts were incurred due to utilizing alternative transportation route associated with Putumayo production in Colombia which was significantly more expensive and resulted in approximately $4.1 million for the current quarter.
Previous report
Oil, natural gas and NGL salesfor the three months ended March 31, 2026, increased by 2% to $172.1 million compared to the corresponding period of 2025 due to 3% higher sales volumes driven by selling production from newly acquired Perico Block in Ecuador and 5% increase in Brent price, offset by higher quality and transportation discounts in Colombia. Higher quality and transportation discounts incurred due to using alternative transportation route associated with Putumayo production which was significantly more expensive and resulted in approximately $4.1 million for the current quarter.
Previous report
Compared to the prior quarter, oil, natural gas and NGL sales increased by 32%, primarily due to a 24% increase in Brent price, and a 12% increase in sales volumes as a result of higher sales volumes in Ecuador partially offset by higher differentials. During the first quarter, we had two liftings in Ecuador compared to one in prior quarter. The sales price in Ecuador is the average Brent price less discounts for the month prior to lifting (M-1). During the three months ended March 31, 2026, we sold our January 2026 production for the average Brent price of December 2025 and the March 2026 production at the average Brent price of February 2026.
Previous report
(1) Operating netback is a non-GAAP measure that does not have any standardized meaning prescribed under GAAP. Refer to note 2 “Non-GAAP measures” in “Financial and Operational Highlights” for a definition and reconciliation of this measure.
Previous report
Operating expenses for the three months ended March 31, 2026, decreased by 1% to $66.1 million compared to the corresponding period of 2025 due to lower workover activities, lower power generation and field personnel costs associated with head count optimization partially offset by higher inventory fluctuations due to the sale of oil inventory accumulated at the end of the previous quarter.
Previous report
On a per boe basis, operating expenses decreased by $0.85 to $18.25 compared to the corresponding period of 2025, primarily due to $1.14 per boe lower workover activities which were partially offset by $0.21 per boe higher lifting costs associated with inventory fluctuations.
Previous report
Compared to the prior quarter, operating expenses increased by 16% from $57.2 million or by$0.98 from $17.27 on a per boe basis primarily a result of inventory fluctuations due to the sale of oil inventory accumulated at the end of the previous quarter partially offset by lower workover activities and lower operating costs across various categories.
Previous report
Transportation expenses for the three months ended March 31, 2026, increased by 17% to $5.3 million or $0.16 to $1.46 per boe, compared to the corresponding period of 2025, due to higher sales volumes transported in Ecuador during the current quarter.
Previous report
Transportation expenses increased by 44% or $0.35 per boe from $3.7 million or $1.11 per boe in the prior quarter for the same reason mentioned above.
Previous report
G&A expenses before stock-based compensation for the three months ended March 31, 2026, increased by 27% to $15.1 million or by $0.78 to $4.18 per boe compared to the corresponding period of 2025, primarily due to higher consulting costs attributable to optimization projects.
Previous report
Compared to the prior quarter, G&A expenses after stock-based compensation increased by 75% or $3.61 per boe for the same reason mentioned above.
Previous report
During the three months ended March 31, 2026, we spud three development wells in Colombia and three in Canada. As of March 31, 2026, two development wells drilled in Colombia were producing and one well was in-progress. The wells drilled in Canada were in Simonette area, which was disposed during the three months ended March 31, 2026.
Previous report
Subsequent to March 31, 2026, we entered into the following foreign currency exchange derivative positions:
Reworded paragraphs (59)
Previous wording
Key Highlights for the first quarter of 2026
Current wording
Key Highlights for the second quarter of 2026
Previous wording
•Net loss for the first quarter of 2026 was $119.2 million or $3.38 per share basic and diluted, compared to a net loss of $19.3 million or $0.54 per share basic and diluted for the first quarter of 2025 and a net loss of $141.1 million for the prior quarter. The following non-cash items were the main contributors to net loss for the first quarter of 2026: $77.3 million unrealized mark-to-market hedging loss, $19.7 million stock-based compensation remeasurement, $11.3 million amortization of deferred financing fees and $4.5 million oil prepayment interest
Current wording
•Net income for the second quarter of 2026 was $24.9 million or $0.70 per share basic and diluted, compared to a net loss of $12.7 million or $(0.36) per share basic and diluted for the second quarter of 2025 and a net loss of $119.2 million or $(3.38) per share for the prior quarter.
Previous wording
•Loss before income taxes for the first quarter of 2026 was $145.8 million, compared to loss before income taxes of $15.7 million for the first quarter of 2025 and loss before income taxes of $177.8 million for the prior quarter
Current wording
•Income before income taxes for the second quarter of 2026 was $45.3 million, compared to loss before income taxes of $8.1 million for the second quarter of 2025 and loss before income taxes of $145.8 million for the prior quarter
Previous wording
•Brent oil price averaged $78.38 per bbl during the quarter, an increase of 5% from the comparative period of 2025, and a 24% increase from the prior quarter. Castilla, Vasconia and Oriente differentials averaged$9.67, $5.91 and $8.17 per bbl during the quarter, an increase of 81%, 160% and 7% from the comparable period of 2025, and an increase of 49%, 73% for Castilla and Vasconia differentials and 3% decrease for Oriente differential from the prior quarter, respectively
Current wording
•Brent oil price averaged $96.68 per bbl during the quarter, an increase of 45% from the comparative period of 2025, and an increase of 23% from the prior quarter. Castilla, Vasconia and Oriente differentials averaged$9.71, $1.42 and $2.01 per bbl during the quarter, an increase of 105% for Castilla and a decrease of 17% and 72% for Vasconia and Oriente differentials from the comparable period of 2025. Castilla differential was comparable to the prior quarter and Vasconia and Oriente differentials decreased by 76% and 75% from the prior quarter, respectively
Previous wording
•Adjusted EBITDA(2) was $73.9 million for the first quarter of 2026, a decrease from $85.2 million in the first quarter of 2025, and an increase from $52.5 million in the prior quarter
Current wording
•Adjusted EBITDA(2) was $85.1 million for the second quarter of 2026, an increase from $77.0 million in the second quarter of 2025, and $73.9 million in the prior quarter
Previous wording
•NAR production for the first quarter of 2026 decreased by 2% to 37,741 BOEPD, compared to 38,563 BOEPD in the first quarter of 2025, and decreased by 4% from 39,464 BOEPD in the prior quarter
Current wording
•NAR production for the second quarter of 2026 decreased by 20% to 31,990 BOEPD, compared to 39,800 BOEPD in the second quarter of 2025, and decreased by 15% from 37,741 BOEPD in the prior quarter primarily due to lower production in Colombia, higher in-kind royalties driven by higher oil prices and asset sales in Canada
Previous wording
•NAR Sales volumes for the first quarter of 2026 increased by 3% to 40,267 BOEPD, compared to 39,024 BOEPD in the first quarter of 2025 and increased by 12% from 35,984 BOEPD in the prior quarter
Current wording
•NAR sales volumes for the second quarter of 2026 decreased by 16% to 32,166 BOEPD, compared to 38,331 BOEPD in the second quarter of 2025 and decreased by 20% from 40,267 BOEPD in the prior quarter
Previous wording
•Gross profit increased to $36.7 million compared to $28.1 million in first quarter of 2025 and $0.9 million in the prior quarter
Current wording
•Gross profit increased to $75.5 million compared to $23.3 million in the second quarter of 2025 and $36.7 million in the prior quarter
Previous wording
•Quality and transportation discounts for oil per boe in Canada increased for the first quarter of 2026 to $9.64 compared to $7.48 in the first quarter of 2025 due to higher pipeline tariffs related to new wells drilled and decreased from $10.35 in the prior quarter
Current wording
•Quality and transportation discounts for oil per boe in Canada for the second quarter of 2026 decreased to $2.24 compared to $8.22 in the second quarter of 2025 and $9.70 in the prior quarter due to lower pipeline tariffs in the current quarter resulting from a change in product mix associated with asset sales
Previous wording
•Capital expenditures for the first quarter of 2026 were $45.4 million compared to $94.7 million in the first quarter of 2025 and $53.0 million in the prior quarter
Current wording
•Capital expenditures for the second quarter of 2026 were $54.3 million compared to $51.2 million in the second quarter of 2025 and $45.4 million in the prior quarter
Previous wording
•During the first quarter, we entered into a strategic partnership with Ecopetrol S.A. to earn, subject to regulatory approvals and conditions precedent, a 49% WI in the Tisquirama Block in Colombia
Current wording
•During the second quarter, we satisfied all outstanding conditions precedent to and received regulatory approval for a strategic partnership with Ecopetrol S.A., earning a 49% working interest in the Tisquirama Block in Colombia. Additionally, we completed all capital commitments related to Suroriente Block.
Previous wording
(*)Calculated as DD&A expenses for the three months ended March 31, 2026 and 2025 of $46.4 million and $48.7 million less depreciation of administrative assets of $5.7 million and $3.7 million, respectively. For the prior quarter, calculated as DD&A expenses of $53.3 million, less depreciation of administrative assets of $3.9 million.
Current wording
(*)Calculated as DD&A expenses for the three months ended June 30, 2026 and 2025 of $43.5 million and $50.5 million less depreciation of administrative assets of $5.5 million and $2.6 million, respectively. For the six months ended June 30, 2026 and 2025, DD&A expenses of $89.9 million and $99.1 million, less depreciation of administrative assets of $11.2 million and $6.2 million, respectively. For the prior quarter, calculated as DD&A expenses of $46.4 million, less depreciation of administrative assets of $5.7 million.
Previous wording
(*)Calculated as DD&A expenses for the three months ended March 31, 2026 and 2025 of $16.0 million and $10.5 million less depreciation of administrative assets of $0.1 million and nil, respectively. For the prior quarter, calculated as DD&A expenses of $5.5 million, less depreciation of administrative assets of $0.3 million.
Current wording
(*)Calculated as DD&A expenses for the three months ended June 30, 2026 and 2025 of $10.3 million and $4.4 million less depreciation of administrative assets of $0.6 million and nil, respectively. For the six months ended June 30, 2026 and 2025, DD&A expenses of $26.3 million and $14.8 million less depreciation of administrative assets of $0.7 million and nil, respectively. For the prior quarter, calculated as DD&A expenses of $16.0 million, less depreciation of administrative assets of $0.1 million.
Previous wording
(*)Same as DD&A expenses for the three months ended March 31, 2026 and 2025 and the prior quarter.
Current wording
(*)Same as DD&A expenses for the three months ended June 30, 2026 and 2025, six months ended June 30, 2026 and 2025, and the prior quarter (the depreciation of administrative assets had a de minimus amount for all reported periods).
Previous wording
(*)Calculated as DD&A expenses for the three months ended March 31, 2026 and 2025 of $69.9 million and $72.2 million less depreciation of administrative assets of $6.0 million and $3.8 million, respectively. For the prior quarter, calculated as DD&A expenses of $72.5 million, less depreciation of administrative assets of $4.3 million.
Current wording
(*)Calculated as DD&A expenses for the three months ended June 30, 2026 and 2025 of $62.3 million and $68.6 million less depreciation of administrative assets of $6.1 million and $2.7 million, respectively. For the six months ended June 30, 2026 and 2025, DD&A expenses of $132.2 million and $140.8 million less depreciation of administrative assets of $12.0 million and $6.5 million, respectively. For the prior quarter, calculated as DD&A expenses of $69.9 million, less depreciation of administrative assets of $6.0 million.
Previous wording
EBITDA, as presented, is defined as net income (loss) adjusted for depletion, depreciation and accretion (“DD&A”) expenses, interest expense, and income tax expense or recovery. Adjusted EBITDA, as presented, is defined as EBITDA adjusted for asset impairment, severance expense, non-cash lease expense, lease payments, foreign exchange gains or losses, stock-based compensation expense or recovery, other non-cash gains or losses and unrealized derivative instruments gains or losses. Management uses this supplemental measure to analyze performance and income generated by our principal business activities prior to the consideration of how non-cash items affect that income and believes that this financial measure is a useful supplemental information for investors to analyze our performance and financial results. A reconciliation from net income (loss) to EBITDA and adjusted EBITDA is as follows:
Current wording
EBITDA, as presented, is defined as net income (loss) adjusted for depletion, depreciation and accretion (“DD&A”) expenses, interest expense, and income tax expense or recovery. Adjusted EBITDA, as presented, is defined as EBITDA adjusted for severance expense, non-cash lease expense, lease payments, foreign exchange gains or losses, stock-based compensation expense or recovery, other non-cash gains or losses and unrealized derivative instruments gains or losses. Management uses this supplemental measure to analyze performance and income generated by our principal business activities prior to the consideration of how non-cash items affect that income and believes that this financial measure is a useful supplemental information for investors to analyze our performance and financial results. A reconciliation from net income (loss) to EBITDA and adjusted EBITDA is as follows:
Previous wording
Funds flow from operations, as presented, is defined as net loss adjusted for DD&A expenses, asset impairment, deferred income tax expense or recovery, stock-based compensation expense or recovery, amortization of debt issuance costs, Senior Notes exchange fees, non-cash interest, non-cash lease expense, lease payments, unrealized foreign exchange gain or loss, unrealized derivative instruments gains or loss and other non-cash gains or losses. Management uses this financial measure to analyze performance and income generated by our principal business activities prior to the consideration of how non-cash items affect that income and believes that this financial measure is also useful supplemental information for investors to analyze performance and our financial results. A reconciliation from net loss to funds flow from operations is as follows:
Current wording
Funds flow from operations, as presented, is defined as net income (loss) adjusted for DD&A expenses, deferred income tax expense or recovery, stock-based compensation expense or recovery, amortization of debt issuance costs, Senior Notes exchange fees, non-cash interest, non-cash lease expense, lease payments, unrealized foreign exchange gain or loss, unrealized derivative instruments gains or losses and other non-cash gains or losses. Management uses this financial measure to analyze performance and income generated by our principal business activities prior to the consideration of how non-cash items affect that income and believes that this financial measure is also useful supplemental information for investors to analyze performance and our financial results. A reconciliation from net loss to funds flow from operations is as follows:
Previous wording
(1) Operating netback is a non-GAAP measure that does not have any standardized meaning prescribed under GAAP. Refer to note 2 “Non-GAAP measures” in “Financial and Operational Highlights” for a definition of this measure.
Current wording
(1) Operating netback is a non-GAAP measure that does not have any standardized meaning prescribed under GAAP. Refer to footnote 2 “Non-GAAP measures” in “Financial and Operational Highlights” for a definition of this measure.
Previous wording
Oil, natural gas and NGL production NAR for the three months ended March 31, 2026, decreased by 2% to 37,741 BOEPD compared to the corresponding period of 2025 due to lower production in Acordionero field in Colombia and the sale of Simonette area in Canada, partially offset by higher than anticipated production results from Conejo-1 well in Charapa Block and additional production from Perico Block in Ecuador acquired in December 2025. Oil, natural gas and NGL production NAR decreased by 4% compared to the prior quarter for the same reason mentioned above.
Current wording
Oil, natural gas and NGL production NAR for the three and six months ended June 30, 2026, decreased by 20% and 11% to 31,990 BOEPD and 34,850 BOEPD, respectively, compared to the corresponding periods of 2025 due to lower production in Colombia, higher in-kind royalties driven by higher oil prices and the sale of Simonette area in Canada at the end of prior quarter, partially offset by higher than anticipated production results from Conejo-1 well in Charapa Block and additional production from Perico Block in Ecuador acquired in December 2025. Oil, natural gas and NGL production NAR decreased by 15% compared to the prior quarter primarily due to the sale of the Simonette area in Canada and lower production in the Acordionero and Cohembi fields in Colombia as a result of failure of artificial lift systems.
Previous wording
Royalties as a percentage of production for the three months ended March 31, 2026 were comparable to the corresponding period of 2025. Royalties as a percentage of production increased 2% compared to the prior quarter commensurate with the increase in benchmark oil prices and the price sensitive royalty regime in Colombia, Ecuador, and Canada.
Current wording
Royalties as a percentage of production for the three and six months ended June 30, 2026 increased to 23% and 20%, respectively, compared to the corresponding periods of 2025 and the prior quarter as a result of higher benchmark oil prices and the price sensitive royalty regime in Colombia and Ecuador.
Previous wording
During the three months ended March 31, 2026, 100% of sales from South America was priced against Brent.
Current wording
During the three and six months ended June 30, 2026 and 2025, 100% of sales from South America was priced against Brent.
Previous wording
WTI -For the three months ended March 31, 2026, WTI increased 2% from the corresponding period of 2025 and increased 23% from the prior quarter. During the first quarter of 2026, 25% of NAR production in Canada was oil, compared to 21% for the comparable period of 2025, and 26% for the prior quarter.
Current wording
WTI -For the three and six months ended June 30, 2026, WTI increased by 45% and 22% from the corresponding periods of 2025 and increased 27% from the prior quarter. During the three and six months ended June 30, 2026, 22% and 23% of NAR production in Canada was oil, compared to 26% and 23% for the corresponding periods of 2025 and 25% in the prior quarter, respectively.
Previous wording
NGLs - For the three months ended March 31, 2026, the weighted average NGL price received was 10% of WTI compared to 14% percent of WTI in the comparable period of 2025 and 22% percent of WTI in the prior quarter. During the first quarter of 2026, 26% of production in Canada were NGLs, compared to 27% from the comparable period of 2025 and 24% in the prior quarter.
Current wording
NGLs - For the three and six months ended June 30, 2026, the weighted average NGL price received was 7% and 12% of WTI compared to 11% and 12% of WTI in the corresponding periods of 2025, respectively, and 10% of WTI in the prior quarter. During the three and six months ended June 30, 2026, NGLs production in Canada was 27% in each reporting period, and comparable to the corresponding periods of 2025 and the prior quarter.
Previous wording
AECO - For the three months ended March 31, 2026, AECO price decreased 7% and 9% from the comparable period of 2025 and from prior quarter, respectively. During the first quarter of 2026, 49% of production in Canada was natural gas, compared to 52% from the comparable period of 2025 and 50% in the prior quarter.
Current wording
AECO - For the three and six months ended June 30, 2026, AECO price decreased by 3% and 5% from the corresponding periods of 2025 and decreased 19% from the prior quarter. During the three and six months ended June 30, 2026, 52% and 50% of production in Canada was natural gas, compared to 50% and 51%, in the corresponding periods of 2025, respectively, and 49% in the prior quarter.
Previous wording
The following table shows the effect of changes in realized price and sale volumes on our oil sales for the three months ended March 31, 2026, compared to the prior quarter and the corresponding period of 2025:
Current wording
The following table shows the effect of changes in realized price and sale volumes on our oil, natural gas and NGL sales for the three and six months ended June 30, 2026, compared to the prior quarter and the corresponding periods of 2025:
Previous wording
(*)Calculated as DD&A expenses for the three months ended March 31, 2026 and 2025 of $46.4 million and $48.7 million less depreciation of administrative assets of $5.7 million and $3.7 million, respectively. For the prior quarter, calculated as DD&A expenses of $53.3 million, less depreciation of administrative assets of $3.9 million.
Current wording
(*)Calculated as DD&A expenses for the three months ended June 30, 2026 and 2025 of $43.5 million and $50.5 million less depreciation of administrative assets of $5.5 million and $2.6 million, respectively. For the six months ended June 30, 2026 and 2025, DD&A expenses of $89.9 million and $99.1 million less depreciation of administrative assets of $11.2 million and $6.2 million, respectively. For the prior quarter, calculated as DD&A expenses of $46.4 million, less depreciation of administrative assets of $5.7 million.
Previous wording
(*)Calculated as DD&A expenses for the three months ended March 31, 2026 and 2025 of $16.0 million and $10.5 million less depreciation of administrative assets of $0.1 million and nil, respectively. For the prior quarter, calculated as DD&A expenses of $5.5 million, less depreciation of administrative assets of $0.3 million.
Current wording
(*)Calculated as DD&A expenses for the three months ended June 30, 2026 and 2025 of $10.3 million and $4.4 million less depreciation of administrative assets of $0.6 million and nil, respectively. For the six months ended June 30, 2026 and 2025. DD&A expenses of $26.3 million and $14.8 million less depreciation of administrative assets of $0.7 million and nil, respectively. For the prior quarter, calculated as DD&A expenses of $16.0 million, less depreciation of administrative assets of $0.1 million.
Previous wording
(*)Calculated as DD&A expenses for the three months ended March 31, 2026 and 2025 of $69.9 million and $72.2 million less depreciation of administrative assets of $6.0 million and $3.8 million, respectively. For the prior quarter, calculated as DD&A expenses of $72.5 million, less depreciation of administrative assets of $4.3 million.
Current wording
(*)Calculated as DD&A expenses for the three months ended June 30, 2026 and 2025 of $62.3 million and $68.6 million less depreciation of administrative assets of $6.1 million and $2.7 million, respectively. For the six months ended June 30, 2026 and 2025, DD&A expenses of $132.2 million and $140.8 million less depreciation of administrative assets of $12.0 million and $6.5 million, respectively. For the prior quarter, calculated as DD&A expenses of $69.9 million, less depreciation of administrative assets of $6.0 million.
Previous wording
We have options to sell our oil through multiple pipelines and various trucking routes. Each option has varying effects on realized sales price and transportation expenses. The following table shows the percentage of oil, natural gas and NGL volumes we sold in Canada, Colombia and Ecuador using each option for the three months ended March 31, 2026 and 2025, and the prior quarter:
Current wording
We have options to sell our oil through multiple pipelines and various trucking routes. Each option has varying effects on realized sales price and transportation expenses. The following table shows the percentage of oil, natural gas and NGL volumes we sold in Canada, Colombia and Ecuador using each option for the three and six months ended June 30, 2026 and 2025, and the prior quarter:
Previous wording
•Oil, natural gas and NGL sales for the first quarter of 2026 increased by 2% to $172.1 million, compared to the first quarter of 2025, due to higher sales volumes driven by selling production from the newly acquired Perico Block in Ecuador and increase in Brent price, offset by higher quality and transportation discounts in Colombia. Higher quality and transportation discounts incurred due to using alternative transportation route associated with Putumayo production which was significantly more expensive and resulted in approximately $4.1 million for the current quarter. Oil, natural gas and NGL sales increased by 32% from $129.9 million in the prior quarter due to higher oil prices, and increase in sales volumes, partially offset by higher differentials. During the first quarter, we had two liftings in Ecuador compared to one in the prior quarter. The sales price in Ecuador is the average Brent price less discounts for the month prior to lifting (M-1). During the current quarter, we sold our January 2026 production in Ecuador at the average Brent price of December 2025 and March production at the average Brent price of February 2026
Current wording
(*)The sales price in Ecuador is the average Brent price less discounts for the month prior to lifting (M-1).
Previous wording
DD&A expenses for the three months ended March 31, 2026, decreased by 3% or by$1.28 on a per boe basis, due to lower costs in the depletable base for Canadian operations as a result of Simonette field disposition and higher proved reserves in Ecuador, compared to the corresponding period of 2025.
Current wording
DD&A expenses for the three and six months ended June 30, 2026, decreased by 9% and 6%, respectively, due to lower costs in the depletable base for Canadian operations as a result of Simonette and Lodgepole areas disposition and higher proved reserves across reportable segments compared to the corresponding periods of 2025. On a per boe basis, DD&A expenses for the three and six months ended June 30, 2026, increased by $1.61 and $0.06, respectively, due to the lower sales volumes in the current periods.
Previous wording
DD&A expenses decreased by 4% from $72.5 million or by $2.63 on a per boe basis when compared to the prior quarter for the same reason mentioned above.
Current wording
DD&A expenses decreased by 11% from $69.9 million and increased by $2.01 on a per boe basis when compared to the prior quarter for the same reason mentioned above.
Previous wording
For the three months ended March 31, 2026 and 2025, we had no ceiling test impairment losses. We used a 12-month unweighted average of the first-day-of the month prices prior to the ending date of the period ended March 31, 2026 as follows: Brent Crude $67.58 per boe, Edmonton Light Crude of C$83.04 per boe, Alberta AECO spot price of C$1.99 per MMBtu Edmonton Propane C$28.38 per boe, Edmonton Butane C$36.04 per boe and Edmonton Condensate C$85.94 and for the period ended three months ended March 31, 2025 Brent Crude of $78.90 per boe, Edmonton Light Crude of C$98.11 per boe, Alberta AECO spot price of C$1.51 per MMBtu Edmonton Propane C$32.53 per boe, Edmonton Butane C$48.81 per boe and Edmonton Condensate C$101.71.
Current wording
For the three and six months ended June 30, 2026 and 2025, we had no ceiling test impairment losses. We used a 12-month unweighted average of the first-day-of-the-month prices prior to the ending date of the period ended June 30, 2026 as follows: Brent Crude $78.55 per bbl, Edmonton Light Crude of C$98.28 per bbl, Alberta AECO spot price of C$1.55 per MMBtu, Edmonton Propane C$32.84 per boe, Edmonton Butane C$41.70 per boe and Edmonton Condensate C$100.06 per boe (June 30, 2025: Brent Crude of $73.60 per bbl, Edmonton Light Crude of C$91.55 per bbl, Alberta AECO spot price of C$1.69 per MMBtu Edmonton Propane C$33.82 per boe, Edmonton Butane C$47.11 per boe and Edmonton Condensate C$95.75 per boe).
Previous wording
G&A expenses after stock-based compensation for the three months ended March 31, 2026, increased by 205% or $6.36 per boe, compared to the corresponding period of 2025, due to higher stock-based compensation cost attributed to a higher share price during the current quarter.
Current wording
G&A expenses after stock-based compensation for the three months ended June 30, 2026, decreased by 36% or $0.97 per boe compared to the corresponding period of 2025 due to lower share price resulting in stock-based compensation recovery. G&A expenses after stock-based compensation for the six months ended June 30, 2026, increased by 70% or $3.04 per boe compared to the corresponding period of 2025, due to higher stock-based compensation cost attributed to a higher share price during the current period.
Previous wording
Compared to the prior quarter, G&A expenses before stock-based compensation decreased by 10% or $0.90 per boe due to headcount optimization and higher sales volumes.
Current wording
Compared to the prior quarter, G&A expenses after stock-based compensation decreased by 73% or $6.37 per boe due to lower share price resulting in stock-based compensation recovery.
Previous wording
For the three months ended March 31, 2026, severance expenses were $2.5 million, compared to nil for the corresponding period of 2025 and the prior quarter, respectively due to headcount optimization.
Current wording
For the three and six months ended June 30, 2026, severance expenses were $0.1 million and $2.6 million, compared to nil for each of the corresponding periods of 2025 and $2.5 million for the prior quarter, respectively, due to headcount optimization.
Previous wording
For the three months ended March 31, 2026, we had a $1.4 million loss on foreign exchange compared to a $3.8 million loss on foreign exchange in the corresponding period of 2025, and a $0.9 million loss on foreign exchange in the prior quarter. Accounts payable, taxes receivable and payable and deferred income taxes are considered monetary items and require translation from local currencies to U.S. dollar functional currency at each balance sheet date. This translation was the primary source of the foreign exchange gains and losses in the periods.
Current wording
For the three and six months ended June 30, 2026, we had foreign exchange losses of $2.6 million and $4.0 million, compared to $3.7 million and $7.6 million losses on foreign exchange in the corresponding periods of 2025, respectively, and a $1.4 million loss on foreign exchange in the prior quarter. Accounts payable, taxes receivable and payable and deferred income taxes are considered monetary items and require translation from local currencies to U.S. dollar functional currency at each balance sheet date. This translation was the primary source of the foreign exchange gains and losses in the periods.
Previous wording
The following table presents the change in the U.S. dollar against the Colombian peso and Canadian dollar for the three months ended March 31, 2026 and 2025 and the prior quarter:
Current wording
The following table presents the change in the U.S. dollar against the Colombian peso and Canadian dollar for the three and six months ended June 30, 2026 and 2025 and the prior quarter:
Previous wording
The following table presents the nature of our financial instruments gains or losses three months ended March 31, 2026 and 2025, and the prior quarter:
Current wording
The following table presents the nature of our financial instruments gains or losses for the three and six months ended June 30, 2026 and 2025, and the prior quarter:
Previous wording
Current income tax expense was $5.9 million for the three months ended March 31, 2026, compared to $8.3 million in the corresponding period of 2025, primarily due to lower taxable income.
Current wording
Current income tax expense was $15.0 million for the six months ended June 30, 2026, compared to $10.5 million in the corresponding period of 2025, primarily due to higher taxable income.
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Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
•During the first quarter of 2026, we completed the disposition of our entire working interest and associated title rights in the Simonette Montney area in Canada
Previous report — wording carried elsewhere
(*)Same as DD&A expenses for the three months ended March 31, 2026 and 2025 and the prior quarter.
Previous report — wording carried elsewhere
The deferred income tax for the three months ended March 31, 2025, was a recovery of $4.7 million mainly due to the use of a higher enacted tax rate on Colombia tax losses. These were partially offset by higher tax depreciation relative to accounting depreciation.