GeoPark Limited

Good morning and welcome to the Geopark Limited conference call following the results announcement for the fourth quarter ended December 31st, 2022. After the speaker's remarks, there'll be a question and answer session. If you'd like to ask a question at this time, please press star one on your telephone keypad. If you'd like to withdraw your question, please press star followed by two. If you do not have a copy of the press release, it is available at the Invest With Us section on the company's corporate website at www.geo-park.com. A replay of today's call may be accessed through this webcast in the Invest With Us section of the Geopark corporate website. Before we continue, please know that certain statements contained in the results press release and on this conference call are forward-looking statements rather than historical facts and are subject to risks and uncertainties that could cause actual results to differ materially from those described. With respect to such forward-looking statements, the company seeks protections afforded by the Private Securities Litigation Reform Act of 1995. These risks include a variety of factors, including competitive development and risk factors listed from time to time in a company's SEC reports and public releases. Those lists are intended to identify certain principal factors that could cause actual results to differ materially from those described in the forward-looking statement, but are not intended to represent a complete list of the company's business. All financial figures included herein were prepared in accordance with the IFRS, and are stated in US dollars unless otherwise noted. Reserve figures correspond to PRMS standards. On the call today from Geopark is Andres Ocampo, Chief Executive Officer, Veronica Davila, Chief Financial Officer, Augusto Zubilaga, Chief Technical Officer, Martin Teredo, Chief Operating Officer, and Stacey Stiemel, Shareholder Value Director. And now, I'll turn the call over to Mr. Andres Ocambo.

Mr. Ocambo, you may begin.

Good morning and thank you for joining our call. We are connecting with our team from Houston, Texas, to report on our fourth quarter and full year 2022 financial results. During 2022, Geopark completed its work program with 50 wells drilled for a total capex of nearly $170 million mainly targeted to grow production in its most profitable assets, 2% production growth in Janus 34 and 50% growth in CP05. Tigana, Hakana, and now Indico rank within the top 10 largest oil-producing fields in Colombia today. With this investment and work program, as well as our team's ability to maintain costs in line despite global inflationary pressures, Geopark closed a record year. with revenues over $1 billion, adjusted EBITDA over $540 million, and bottom line net profits of over $224 million, equivalent to $3.8 per share. Every dollar invested in our assets generated more than three times adjusted EBITDA within the same year, another proof of the high quality of our asset base combined with our capital allocation methodology and cost discipline. Full-year cash flow from operations was $467 million, which not only funded our CAPEX program, but also allowed us to pay down $170 million of debt, canceling our 2024 notes. We ended the year with $129 million in cash, a net debt of $369 million, a net leverage ratio of 0.7 times, well below our comfort zone, and with no principal debt maturities until 2027. Such free cash flow generation also allowed us to continue expanding our shareholder value return initiatives. In 2022, Geopark paid shareholders more than $60 million, representing over $1 per share, through a bigger base dividend and a more accelerated share buyback, and we expect to continue doing more in 2023. 2022 was also an important year in Geopark's mission to provide the cleanest, and most cost-efficient hydrocarbons possible, as we continue to invest and develop ideas to neutralize and reduce our carbon emissions and environmental impact. Last year, we connected the Janus 34 block to the national power grid and installed a solar energy park, reducing our carbon footprint by approximately 30 to 35 percent over a year earlier, with more improvements on the way this year. With 2023 underway, we are embarked on another ambitious work program, planning to invest $200 to $220 million to drill 50 to 55 wells, 10 to 15 of which are low-risk, high-potential abrasion and exploration wells. At $80 Brent, we expect to generate more than half a billion dollars adjusted EBITDA again, and over $120 million of free cash flow, of which we expect to return 40 to 50 percent to shareholders. With 10 rigs currently operating and multiple activities taking place in multiple basins, we look forward to reporting the results of this exciting multi-year drilling program in the upcoming quarters. Thank you, and we would now be happy to answer any questions you may have.