Nevada
|
|
1311
|
|
98-0479924
|
(State
or Other Jurisdiction of
Incorporation
or Organization)
|
|
(Primary
Standard Industrial
Classification
Code Number)
|
|
(I.R.S.
Employer Identification
No.)
|
Page
|
|
SUMMARY
|
1
|
RISK
FACTORS
|
4
|
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
|
17
|
SELLING
STOCKHOLDERS
|
17
|
USE
OF PROCEEDS
|
29
|
DETERMINATION
OF OFFERING PRICE
|
29
|
MARKET
FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
|
29
|
DIVIDEND
POLICY
|
29
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS
|
30
|
BUSINESS
|
40
|
DIRECTORS,
EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
|
52
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
|
56
|
EXECUTIVE
COMPENSATION
|
58
|
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
|
61
|
PLAN
OF DISTRIBUTION
|
61
|
DESCRIPTION
OF SECURITIES
|
64
|
LEGAL
MATTERS
|
68
|
EXPERTS
|
68
|
WHERE
YOU CAN FIND MORE INFORMATION
|
68
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE |
68
|
CONSOLIDATED FINANCIAL STATEMENTS | F-1 |
Common
stock currently outstanding (1)
|
95,455,765 shares
|
Common
stock offered by the selling stockholders (2)
|
17,572,745 shares
|
Common
stock outstanding after the offering (3)
|
102,692,076 shares
|
Use
of Proceeds
|
We
will not receive any proceeds from the sale of common stock offered
by
this prospectus. We will receive the proceeds from any warrant exercises,
which we intend to use for general corporate purposes, including
for
working capital.
|
OTC
Bulletin Board Symbol
|
GTRE.OB
|
§ |
pursuing
growth opportunities, including more rapid expansion;
|
§ |
acquiring
complementary businesses;
|
§ |
making
capital improvements to improve our infrastructure;
|
§ |
hiring
qualified management and key employees;
|
§ |
responding
to competitive pressures;
|
§ |
complying
with licensing, registration and other requirements;
and
|
§ |
maintaining
compliance with applicable laws.
|
§ |
expand
our systems effectively or efficiently or in a timely manner;
|
§ |
allocate
our human resources optimally;
|
§ |
identify
and hire qualified employees or retain valued employees; or
|
§ |
incorporate
effectively the components of any business that we may acquire in
our
effort to achieve growth.
|
·
|
all
bilateral aid, except anti-narcotics and humanitarian aid,
would be
suspended,
|
·
|
the
Export-Import Bank of the United States and the Overseas
Private
Investment Corporation would not approve financing for new
projects in
Colombia,
|
·
|
United
States representatives at multilateral lending institutions
would be
required to vote against all loan requests from Colombia
, although such
votes would not constitute vetoes,
and
|
·
|
the
President of the United States and Congress would retain
the right to
apply future trade sanctions.
|
§ |
effective
legal redress in the courts of such jurisdictions, whether in respect
of a
breach of law or regulation, or, in an ownership dispute, being more
difficult to obtain;
|
§ |
a
higher degree of discretion on the part of governmental authorities;
|
§ |
the
lack of judicial or administrative guidance on interpreting applicable
rules and regulations;
|
§ |
inconsistencies
or conflicts between and within various laws, regulations, decrees,
orders
and resolutions; and
|
§ |
relative
inexperience of the judiciary and courts in such
matters.
|
§ |
dilution
caused by our issuance of additional shares of common stock and other
forms of equity securities, which we expect to make in connection
with
future capital financings to fund our operations and growth, to attract
and retain valuable personnel and in connection with future strategic
partnerships with other companies;
|
§ |
announcements
of new acquisitions, reserve discoveries or other business initiatives
by
our competitors;
|
§ |
fluctuations
in revenue from our oil and natural gas business as new reserves
come to
market;
|
§ |
changes
in the market for oil and natural gas commodities and/or in the capital
markets generally;
|
§ |
changes
in the demand for oil and natural gas, including changes resulting
from
the introduction or expansion of alternative fuels;
and
|
§ |
changes
in the social, political and/or legal climate in the regions in which
we
will operate.
|
§ |
quarterly
variations in our revenues and operating
expenses;
|
§ |
changes
in the valuation of similarly situated companies, both in our industry
and
in other industries;
|
§ |
changes
in analysts’ estimates affecting our company, our competitors and/or our
industry;
|
§ |
changes
in the accounting methods used in or otherwise affecting our
industry;
|
§ |
additions
and departures of key personnel;
|
§ |
announcements
of technological innovations or new products available to the oil
and
natural gas industry;
|
§ |
announcements
by relevant governments pertaining to incentives for alternative
energy
development programs;
|
§ |
fluctuations
in interest rates, exchange rates and the availability of capital
in the
capital markets; and
|
§ |
significant
sales of our common stock, including sales by the investors following
registration of the shares of common stock under the registration
statement of which this prospectus is a part and/or future investors
in
future offerings we expect to make to raise additional capital.
|
Shares
of Common
Stock Owned
Before the
Offering
|
Shares
of Common Stock
Being Offered
|
Shares
of Common
Stock Owned
Upon Completion
of the
Offering (a)
|
Percentage
of Common
Stock Outstanding
Upon Completion
of Offering
|
||||||||||
Amaran
Tyab1
|
7,500
|
7,500
|
--
|
--
|
|||||||||
Arleen
Agate2
|
41,125
|
15,625
|
25,500
|
*
|
|||||||||
Arnie
Charbonneau3
|
15,625
|
15,625
|
--
|
--
|
|||||||||
Arthur
Ruoff4
|
48,000
|
48,000
|
--
|
--
|
|||||||||
Aton
Select Fund Ltd.5
|
937,431
|
937,431
|
--
|
--
|
|||||||||
Bank
Sal. Oppenheim jr. & Cie (Switzerland) Ltd.6
|
1,536,500
|
1,536,500
|
--
|
--
|
|||||||||
Barbara
Jean Taylor7
|
149,982
|
149,982
|
--
|
--
|
|||||||||
Barry
R. Balsillie8
|
233,730
|
75,000
|
158,730
|
*
|
|||||||||
Bashaw
Fertilizer Ltd.9
|
112,500
|
112,500
|
--
|
--
|
|||||||||
Bayford
Investments, Ltd.10
|
150,000
|
150,000
|
--
|
--
|
|||||||||
Beattie
Homes Ltd.11
|
149,982
|
149,982
|
--
|
--
|
|||||||||
Bela
Balaz12
|
29,978
|
29,978
|
--
|
--
|
|||||||||
Ben
T. Morris13
|
138,750
|
93,750
|
45,000
|
*
|
|||||||||
Bernie
Broda14
|
15,625
|
15,625
|
--
|
--
|
|||||||||
Betty
Wong15
|
15,625
|
15,625
|
--
|
--
|
|||||||||
Catherine
E. Coffield16
|
75,000
|
75,000
|
--
|
--
|
|||||||||
Chad
Oakes17
|
644,957
|
374,972
|
269,985
|
*
|
|||||||||
Clive
Mark Stockdale18
|
48,000
|
48,000
|
--
|
--
|
|||||||||
Code
Consulting Ltd.19
|
75,000
|
75,000
|
--
|
--
|
|||||||||
Dale
Foster20
|
191,825
|
37,472
|
154,353
|
*
|
|||||||||
Dana
Quentin Coffield21
|
1,834,662
|
44,978
|
1,789,784
|
1.87
|
%
|
||||||||
Danich
Investments, Ltd.22
|
21,875
|
21,875
|
--
|
--
|
|||||||||
Daniel
Todd Dane23
|
849,977
|
749,978
|
99,999
|
*
|
|||||||||
Don
A. Sanders24
|
675,000
|
375,000
|
300,000
|
*
|
|||||||||
Donald
A. Wright25
|
1,658,730
|
750,000
|
908,730
|
*
|
|||||||||
Donald
V. Weir and Julie E. Weir26
|
258,750
|
93,750
|
165,000
|
*
|
|||||||||
Earl
Fawcett27
|
21,875
|
21,875
|
--
|
--
|
|||||||||
Edward
B. Antonsen28
|
102,500
|
20,000
|
82,500
|
*
|
|||||||||
Edward
Armogan29
|
18,000
|
18,000
|
--
|
--
|
|||||||||
Edward
C. Grant30
|
74,982
|
74,982
|
--
|
--
|
|||||||||
Edwin
Lau31
|
15,625
|
15,625
|
--
|
--
|
|||||||||
Elizabeth
J. Fenton32
|
37,500
|
37,500
|
--
|
--
|
|||||||||
Eric
Pederson33
|
21,875
|
21,875
|
--
|
--
|
|||||||||
Faccone
Enterprises Ltd.34
|
45,625
|
15,625
|
30,000
|
*
|
|||||||||
Gary
Gee Wai Hoy and Lily Lai Wan Hoy35
|
41,119
|
15,619
|
25,500
|
*
|
|||||||||
George
L. Ball36
|
198,750
|
93,750
|
105,000
|
--
|
|||||||||
George
Vernon Symons37
|
44,978
|
44,978
|
--
|
--
|
|||||||||
Grant
Hodgins38
|
41,119
|
15,619
|
25,500
|
*
|
|||||||||
Greg
Crowe39
|
46,875
|
46,875
|
--
|
--
|
Shares
of Common
Stock Owned
Before the
Offering
|
Shares
of Common Stock
Being Offered
|
Shares
of Common
Stock Owned
Upon Completion
of the
Offering (a)
|
Percentage
of Common
Stock Outstanding
Upon Completion
of Offering
|
||||||||||
Gregg
J. Sedun40
|
212,491
|
62,491
|
150,000
|
*
|
|||||||||
Hans
Rueckert41
|
13,500
|
13,500
|
--
|
--
|
|||||||||
Henry
Polessky42
|
15,625
|
15,625
|
--
|
--
|
|||||||||
Hollyvale
Limited43
|
35,500
|
10,000
|
25,500
|
*
|
|||||||||
Humbert
B. Powell III44
|
46,875
|
46,875
|
--
|
--
|
|||||||||
James
E. Anderson45
|
75,000
|
75,000
|
--
|
--
|
|||||||||
James
Fletcher46
|
15,000
|
15,000
|
--
|
--
|
|||||||||
James
L. Harris47
|
15,625
|
15,625
|
--
|
--
|
|||||||||
Jamie
Gilkison48
|
15,625
|
15,625
|
--
|
--
|
|||||||||
Janet
R. Denhamer49
|
37,472
|
37,472
|
--
|
--
|
|||||||||
Jason
Soprovich Realty Inc.50
|
46,875
|
46,875
|
--
|
--
|
|||||||||
Jeffrey
J. Scott51
|
2,513,861
|
674,972
|
1,838,889
|
1.93
|
%
|
||||||||
Jim
and Kathleen Gilders52
|
93,728
|
93,728
|
--
|
--
|
|||||||||
Jim
Anderson53
|
7,500
|
7,500
|
--
|
--
|
|||||||||
John
and Jodi Malanga54
|
63,000
|
37,500
|
25,500
|
*
|
|||||||||
John
W. Seaman55
|
9,999
|
9,999
|
--
|
--
|
|||||||||
Joseph
Grosso56
|
25,000
|
25,000
|
--
|
--
|
|||||||||
Ken
Wong57
|
41,125
|
15,625
|
25,500
|
*
|
|||||||||
Kent
Kirby58
|
7,500
|
7,500
|
--
|
--
|
|||||||||
Kent
Milani59
|
15,000
|
15,000
|
--
|
--
|
|||||||||
Kyung
Chun Min60
|
27,700
|
2,500
|
25,200
|
*
|
|||||||||
Lamond
Investments Ltd61
|
187,500
|
187,500
|
--
|
--
|
|||||||||
Lindsay
Bottomer62
|
37,500
|
37,500
|
--
|
--
|
|||||||||
Lisa
Streu63
|
84,375
|
84,375
|
--
|
--
|
|||||||||
LSM
Business Services Ltd.64
|
76,875
|
46,875
|
30,000
|
*
|
|||||||||
Mahmood
Mangalji65
|
7,500
|
7,500
|
--
|
--
|
|||||||||
Mark
E. Cline66
|
46,875
|
46,875
|
--
|
--
|
|||||||||
Michael
Graham67
|
60,000
|
60,000
|
--
|
--
|
|||||||||
Michael
J. Stark68
|
187,472
|
187,472
|
--
|
--
|
|||||||||
Michael
Paraskake69
|
63,000
|
37,500
|
25,500
|
*
|
|||||||||
Michael
F. Schaefer70
|
500,000
|
500,000
|
--
|
--
|
|||||||||
Nadine
C. Smith and John D. Long, Jr71
|
2,065,761
|
937,500
|
1,128,261
|
1.18
|
%
|
||||||||
Neil
Davey72
|
7,500
|
7,500
|
--
|
--
|
|||||||||
Nell
Dragovan73
|
46,875
|
46,875
|
--
|
--
|
|||||||||
Nick
DeMare74
|
62,491
|
62,491
|
--
|
--
|
|||||||||
North
Group Limited75
|
20,000
|
20,000
|
|||||||||||
Perfco
Investments Ltd.76
|
2,412,302
|
525,000
|
1,877,302
|
1.97
|
%
|
Shares
of Common
Stock Owned
Before the
Offering
|
Shares
of Common Stock
Being Offered
|
Shares
of Common
Stock Owned
Upon Completion
of the
Offering (a)
|
Percentage
of Common
Stock Outstanding
Upon Completion
of Offering
|
||||||||||
Postell
Energy Co Ltd77
|
37,500
|
37,500
|
--
|
--
|
|||||||||
Professional
Trading Services SA78
|
937,500
|
937,500
|
--
|
--
|
|||||||||
Prussian
Capital Corp79
|
75,000
|
75,000
|
--
|
--
|
|||||||||
Richard
M. Crawford80
|
15,625
|
15,625
|
--
|
--
|
|||||||||
Richard
Machin81
|
63,750
|
37,500
|
26,250
|
*
|
|||||||||
Richard
MacDermott82
|
247,478
|
187,478
|
60,000
|
*
|
|||||||||
Rob
Anderson83
|
91,250
|
91,250
|
--
|
--
|
|||||||||
Robert
A. Fenton84
|
37,500
|
37,500
|
--
|
--
|
|||||||||
Robert
D. Steele85
|
549,960
|
112,500
|
437,460
|
*
|
|||||||||
Robert
K. Macleod86
|
39,999
|
15,000
|
24,999
|
*
|
|||||||||
Ron
Carey87
|
74,978
|
74,978
|
--
|
--
|
|||||||||
Rowena
M. Santos88
|
41,125
|
15,625
|
25,500
|
*
|
|||||||||
Samuel
Belzberg89
|
156,250
|
156,250
|
--
|
--
|
|||||||||
Sanders
1998 Childrens Trust90
|
187,500
|
187,500
|
--
|
--
|
|||||||||
Sanders
Opportunity Fund (Institutional) LP91
|
1,520,904
|
721,329
|
799,575
|
*
|
|||||||||
Sanders
Opportunity Fund LP92
|
475,971
|
225,546
|
250,425
|
*
|
|||||||||
Sanovest
Holdings Ltd.93
|
577,500
|
202,500
|
375,000
|
--
|
|||||||||
Sara
Tyab94
|
2,500
|
2,500
|
--
|
--
|
|||||||||
Sean
Warren95
|
33,750
|
33,750
|
--
|
--
|
|||||||||
Standard
Bank PLC 96
|
1,875,000
|
1,875,000
|
--
|
--
|
|||||||||
Suljo
Dzafovic97
|
15,000
|
15,000
|
--
|
--
|
|||||||||
Tammy
L. Gurr98
|
28,125
|
28,125
|
--
|
--
|
|||||||||
The
Brewster Family Trust99
|
15,625
|
15,625
|
--
|
--
|
|||||||||
The
MacLachlan Investments Corporation100
|
62,500
|
62,500
|
--
|
--
|
|||||||||
Tom
Chmilar101
|
15,000
|
15,000
|
--
|
--
|
|||||||||
Tom
Rebane102
|
22,500
|
22,500
|
--
|
--
|
|||||||||
Ursula
Kaiser103
|
37,500
|
37,500
|
--
|
--
|
|||||||||
Verne
G. Johnson104
|
1,232,725
|
187,478
|
1,645,247
|
1.72
|
%
|
||||||||
VP
Bank (Switzerland) Ltd.105
|
562,550
|
312,500
|
250,050
|
--
|
|||||||||
Walter
A. Dawson106
|
401,587
|
300,000
|
101,587
|
*
|
|||||||||
Wayne
Hucik107
|
21,875
|
21,875
|
--
|
--
|
|||||||||
Wildcat
Investments Ltd.108
|
75,000
|
75,000
|
--
|
--
|
|||||||||
William
Lowe109
|
93,750
|
93,750
|
--
|
--
|
|||||||||
William
McCluskey110
|
393,750
|
393,750
|
--
|
--
|
|||||||||
1053361
Alberta Ltd.111
|
491,865
|
262,500
|
229,365
|
*
|
|||||||||
1087741
Alberta Ltd.112
|
15,993
|
15,993
|
--
|
--
|
|||||||||
666977
Alberta Ltd.113
|
12,000
|
12,000
|
--
|
--
|
|||||||||
893619
Alberta Ltd.114
|
149,972
|
149,972
|
--
|
--
|
|||||||||
954866
Alberta Ltd.115
|
30,000
|
30,000
|
--
|
--
|
Quarter
Ended
|
High
|
Low
|
|||||
March 31, 2007 (through February 2) | $ |
1.64
|
$ |
0.88
|
|||
December 31, 2006 |
$
|
1.85 |
$
|
1.08 | |||
September 30, 2006 |
$
|
3.70 |
$
|
1.45 | |||
June
30, 2006
|
$ |
5.12
|
$ |
2.57
|
|||
March
31, 2006
|
$ |
6.06
|
$ |
2.94
|
|||
December
31, 2005
|
$
|
2.83
|
$
|
1.01
|
Plan
category
|
Number
of securities to be issued upon exercise of outstanding options,
warrants
and rights
|
Weighted-average
exercise price of outstanding options, warrants and
rights
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column
(a))
|
|||
(a)
|
(b)
|
(c)
|
||||
Equity
compensation plans approved by security holders
|
1,830,000
|
$1.12
|
170,000
|
|||
Equity
compensation plans not approved by security
holders
|
875,000
|
$1.27
|
1,125,000
|
|||
Total
|
2,705,000
|
—
|
1,295,000
|
|
·
|
$4,000,100
held in escrow relating to the Argosy acquisition is required to
be
replaced by a letter of credit. Release of these funds occurred
on November 9, 2006.
|
|
·
|
$4,000,000
is being held by Standard Bank in support of the letter of credit
noted
above.
|
|
·
|
$3,100,000
will become available upon the expiry of the offer to purchase
certain
assets from CGC.
|
|
·
|
$200,426
is held in escrow with our joint venture partners in Palmar Largo
against
our future cash calls. These funds were released to us in November
2006.
|
|
·
|
$1,280,993
is held in escrow related to the June 2006 financing. These funds
will be
released from escrow pending our request to the Alberta
Securities Commission requesting an exemption from prospectus requirements
for the trading of our common shares for purchasers resident in
Alberta
under “accredited investor” exemptions.
|
|
·
|
$35,744
relates to interest earned on various escrow accounts, which will
be
released along with the principal funds involved.
|
§ |
expected
reservoir characteristics based on geological, geophysical and engineering
assessments;
|
§ |
future
production rates based on historical performance and expected future
operating and investment
activities;
|
§ |
future
oil and gas quality differentials;
|
§ |
assumed
effects of regulation by governmental agencies;
and
|
§ |
future
development and operating costs.
|
§ |
Determining
whether or not an exploratory well has found economically producible
reserves.
|
§ |
Calculating
our unit-of-production depletion rates. Both proved and proved developed
reserves estimates are used to determine rates that are applied to
each
unit-of-production in calculating our depletion expense. Proved reserves
are used where a property is acquired and proved developed reserves
are
used where a property is drilled and
developed.
|
§ |
Assessing,
when necessary, our oil and gas assets for impairment. Estimated
future
cash flows are determined using proved reserves. The critical estimates
used to assess impairment, including the impact of changes in reserves
estimates, are discussed below.
|
§ |
abnormal
amounts of idle facility expense, freight, handling costs and wasted
material (spoilage) should be recognized as current-period charges;
and
|
§ |
the
allocation of fixed production overhead to inventory based on the
normal
capacity of the production facilities is required.
|
§ |
Oil
and gas reserves tend to be distributed in a pyramid
pattern.
The distribution of oil and gas reserves is generally depicted as
a
“pyramid” with the greatest number of fields being smaller fields and with
very few large fields. Because of their size, the large fields are
more
easily located - most have already been discovered and tend to be,
though
are not always, the most economical to produce.
|
§ |
Oil
and gas companies tend to be distributed in a pyramid
pattern.
Oil and gas companies tend to be distributed in a pattern that is
similar
to that of oil and gas reserves. There are many small companies and
few
very large companies. Large companies tend to operate at the top
of the
resource pyramid, where rewards are larger but fewer. Smaller companies
tend to operate at the base of the resource pyramid, where rewards
are
smaller but plentiful. Furthermore, large companies tend to divest
smaller, non-core assets as they grow, and tend to acquire smaller
companies that have reached a critical mass, perpetuating a cycle
of
growth.
|
§ |
In
a mature producing area with a mature industry, the entirety of the
resource pyramid is being explored and developed by both small and
large
oil and gas companies.
Maturity is typically a function of time and market forces. Government
policy can have an important role, encouraging or discouraging the
full
potential of the resource base and industry.
|
§ |
By
its nature, finding and producing oil and gas is a risky
business.
Oil and gas deposits may be located miles below the earth’s surface. There
is no guarantee, despite the sophistication of modern exploration
techniques, that oil or gas will be present in a particular location
without drilling. Additionally, there is no guarantee that a discovery
will be commercially viable without follow up drilling, nor can there
be
any guarantee that such follow up drilling will be successful. There
is
also no guarantee that reserves once established will produce at
expected
rates. Furthermore, adverse political events and changing laws/regulations
can threaten the economic viability of oil and gas activity, the
safety
and security of workers, or the reputation of a company that conducts
business outside of more stable countries. The effective management
of
risk is integral to the oil and gas
industry.
|
§ |
The
oil and gas industry is capital intensive. Investment
decisions are based on long time horizons - the typical oil and gas
project has a life of greater than 20 years. Economics and value
are based
on a long-term perspective.
|
§ |
The
production profile for a substantial majority of oil and gas reservoirs
is
a declining trend. Production
from an oil or gas field with a fixed number of wells declines over
time.
That decline rate varies depending on the reservoir and well/development
characteristics but in general, steepest declines are earlier in
the
production life of the field. Typically, production falls to a point
where
revenues are insufficient to cover operating costs (the project reaches
its economic limit) and the field is
abandoned.
|
§ |
Production
levels in a field can be maintained by more intensive drilling and/or
enhancement of existing wells and such efforts are usually made to
offset
the natural decline in production.
A
low price environment, budgetary constraints or lack of imagination
can
prevent companies from taking appropriate action to offset a natural
decline in production, however, this can present a significant opportunity
for new operators in a high price environment. While
production levels may be maintained for a period of time by more
intensive
drilling, such efforts can only be maintained for short periods of
time
and may not be effective. Moreover, such efforts may also be economically
unfeasible and may be impermissible under rules and regulations applying
to the field.
|
§ |
Position
in countries that are welcoming to foreign investment, that provide
attractive fiscal terms and/or offer opportunities that have been
previously ignored or undervalued;
|
§ |
Engage
qualified, experienced and motivated professionals;
|
§ |
Establish
an effective local presence;
|
§ |
Create
alliances with companies that are active in areas and countries of
interest, and consolidate initial land/property positions;
|
§ |
Build
a balanced portfolio of production, development, step-out and more
speculative exploration opportunities;
|
§ |
Assess
and close opportunities expeditiously;
|
§ |
Do
business in familiar countries with familiar people and familiar
assets.
|
§ |
Palmar
Largo Joint Venture - Gran Tierra participation 14%, Pluspetrol (Operator)
38.15%, Repsol YPF 30%, Compañia General de Combustibles (“CGC”)
17.85%.
|
§ |
Nacatimbay
Concession - Gran Tierra participation 50%, CGC (Operator)
50%.
|
§ |
Ipaguazu
Concession - Gran Tierra participation 50%, CGC (Operator)
50%.
|
Estimated
Reserves (1)
Net
to Gran Tierra, After 12% Royalty, at December 31,
2005
|
|||
Oil
(thousand
barrels)
|
Natural
Gas
(million
cubic feet)
|
Liquids
(thousand
barrels)
|
|
Palmar
Largo
|
Nacatimbay
|
Nacatimbay
|
|
Proved
Developed
|
462
|
24.5
|
1.72
|
Proved
Undeveloped
|
119
|
—
|
—
|
Total
Proved
|
581
|
24.5
|
1.72
|
Production
Net
to Gran Tierra, After 12% Royalty, September 1 - December 31,
2005
|
Oil -
Palmar Largo
|
Natural
Gas - Nacatimbay
|
Liquids
- Nacatimbay
|
|||
(barrels
per day)
|
(average
price)
|
(thousand
cubic feet per day)
|
(average
price)
|
(barrels
per day)
|
|
293
|
$37.80/barrel
|
494
|
$1.50/thousand
cubic feet
|
5
|
Productive
Wells
Gran
Tierra, December 31, 2005
|
||||||
(Number
of wells)
|
Oil
|
Natural
Gas
|
Total
|
|||
|
Gross(1)
|
Net(2)
|
Gross(1)
|
Net(2)
|
Gross(1)
|
Net(2)
|
Palmar
Largo
|
16
|
2.2
|
—
|
—
|
16
|
2.2
|
Nacatimbay
|
—
|
—
|
1
|
0.5
|
1
|
0.5
|
Ipaguazu
|
—
|
—
|
—
|
—
|
—
|
—
|
Total
|
16
|
2.2
|
1
|
0.5
|
17
|
2.7
|
Acreage
Gran
Tierra, December 31, 2005
|
||||||
(Acres)
|
Developed
|
Undeveloped
|
Total
|
|||
Gross(1)
|
Net(2)
|
Gross(1)
|
Net(2)
|
Gross(1)
|
Net(2)
|
|
Palmar
Largo
|
301,700
|
42,238
|
—
|
—
|
301,700
|
42,238
|
Nacatimbay
|
36,600
|
18,300
|
—
|
—
|
36,600
|
18,300
|
Ipaguazu
|
43,200
|
21,600
|
—
|
—
|
43,200
|
21,600
|
Total
|
381,500
|
82,138
|
—
|
—
|
381,500
|
82,138
|
Drilling
Activity
Gran
Tierra, 2005
|
||||||
(Number
of wells)
|
Productive
|
Dry
|
Total
|
|||
Gross(1)
|
Net(2)
|
Gross(1)
|
Net(2)
|
Gross(1)
|
Net(2)
|
|
Exploration
|
—
|
—
|
1
|
0.14
|
1
|
0.14
|
Development
|
1
|
0.14
|
—
|
—
|
1
|
0.14
|
Total
|
1
|
0.14
|
1
|
0.14
|
2
|
0.28
|
Name
|
Age
|
Position
|
||
Dana
Coffield
|
48
|
President
and Chief Executive Officer; Director
|
||
James
Hart
|
52
|
Director
|
||
Max
Wei
|
56
|
Vice
President, Operations
|
||
Rafael
Orunesu
|
50
|
President,
Gran Tierra Energy Argentina
|
||
Edgar Dyes |
61
|
President, Argosy Energy/Gran Tierra Energy Colombia | ||
Jeffrey
Scott
|
44
|
Chairman
of the Board of Directors
|
||
Walter
Dawson
|
66
|
Director
|
||
Verne
Johnson
|
62
|
Director
|
||
Nadine
C. Smith
|
49
|
Director
|
||
Martin H. Eden |
59
|
Chief Financial Officer |
Name
and Address of Beneficial Owner
|
Amount
and
Nature
of
Beneficial
Owner
|
Percentage
of
Class
|
|||||
Dana
Coffield (2)
|
1,888,829
|
1.98
|
%
|
||||
James
Hart (3)
|
1,743,850
|
1.83
|
%
|
||||
Max
Wei (3)
|
1,783,834
|
1.87
|
%
|
||||
Rafael
Orunesu (3)
|
1,863,850
|
1.95
|
%
|
||||
Jeffrey
Scott (4)
|
2,563,861
|
2.68
|
%
|
||||
Walter
Dawson (5)
|
3,005,952
|
3.14
|
%
|
||||
Verne
Johnson (6)
|
1,662,884
|
1.74
|
%
|
||||
Nadine
C. Smith (7)
|
2,099,094
|
2.19
|
%
|
||||
Greywolf
Capital Management LP (8)
|
10,000,001
|
10.12
|
%
|
||||
Millennium
Global Investments Limited (9)
|
5,002,500
|
5.15
|
%
|
||||
US
Global Investors, Inc. (10)
|
5,000,000
|
5.15
|
%
|
||||
Directors
and officers as a group (total of 8 persons)
|
16,612,154
|
17.13
|
%
|
(1)
|
Beneficial
ownership is calculated based on 95,455,765 shares of common stock
issued and outstanding as of February 2, 2007, which number includes
shares of common stock issuable upon the exchange of the exchangeable
shares of Goldstrike Exchange Co. issued to certain former holders
of Gran
Tierra Canada's common stock. Beneficial ownership is determined
in
accordance with Rule 13d-3 of the SEC. The number of shares beneficially
owned by a person includes shares of common stock underlying options
or
warrants held by that person that are currently exercisable or
exercisable
within 60 days of February 2, 2007. The shares issuable pursuant
to the
exercise of those options or warrants are deemed outstanding for
computing
the percentage ownership of the person holding those options and
warrants
but are not deemed outstanding for the purposes of computing the
percentage ownership of any other person. Unless otherwise indicated,
the
persons and entities named in the table have sole voting and sole
investment power with respect to the shares set forth opposite
that
person's name, subject to community property laws, where
applicable.
|
(2)
|
The
number of shares beneficially includes an option to acquire 54,167
shares
of common stock exercisable within 60 days of February 2, 2007,
and a
warrant to acquire 48,334 shares of common stock exercisable within
60
days of February 2, 2007. The number of shares beneficially owned
also
includes 1,689,683 exchangeable
shares.
|
(3)
|
The
number of shares beneficially includes an option to acquire 54,167
shares
of common stock exercisable within 60 days of February 2, 2007.
All other
shares beneficially owned by such stockholder are exchangeable
shares.
|
(4)
|
The
number of shares beneficially includes an option to acquire 50,000
shares
of common stock exercisable within 60 days of February 2, 2007,
and a
warrant to acquire 274,991 shares of common stock exercisable within
60
days of February 2, 2007. The number of shares beneficially owned
also
includes 1,688,889 exchangeable
shares.
|
(5)
|
The
number of shares beneficially includes an option to acquire 33,333
shares
of common stock exercisable within 60 days of February 2, 2007.
The number
beneficially owned also includes warrants to acquire 375,000 shares
of
common stock exercisable within 60 days of February 2, 2007, of
which
warrants to acquire 275,000 shares are held by Perfco Investments
Ltd
("Perfco"). The number of shares beneficially owned also includes
550,000
shares of common stock directly owned by Perfco and 158,730 shares
of
common stock directly owned by Mr. Dawson's spouse. The number
of shares
beneficially owned includes 1,688,889 exchangeable shares, of which
1,587,302 are held by Perfco. Mr. Dawson is the sold owner of Perfco
and
has sole voting and investment power over the shares beneficially
owned by
Perfco. Mr. Dawson disclaims beneficial ownership over the shares
beneficially owned by Perfco.
|
(6)
|
The
number of shares beneficially includes an option to acquire 33,333
shares
of common stock exercisable within 60 days of February 2, 2007,
and a
warrant to acquire 112,496 shares of common stock exercisable within
60
days of February 2, 2007. The number of shares beneficially owned
includes
1,292,064 exchangeable shares, of which 396,825 are held by KirstErin
Resources, Ltd., a private family-owned business of which Mr. Johnson
is
the President. Mr. Johnson has sole voting and investment power
over the
shares held by KirstErin Resources, Ltd.
|
(7)
|
The
number of shares beneficially includes an option to acquire 33,333
shares
of common stock exercisable within 60 days of February 2, 2007,
and a
warrant to acquire 362,500 shares of common stock exercisable within
60
days of February 2, 2007.
|
(8)
|
Greywolf
Capital Management LP is the investment manager for (a) Greywolf
Capital
Overseas Fund ("GCOF"), which owns 4,800,000 shares of common stock
and a
warrant to acquire 2,400,000 shares of common stock exercisable
within 60
days of February 2, 2007, and (b) Greywolf Capital Partners II
("GCP"),
which owns 1,888,667 shares of common stock and a warrant to acquire
933,334 shares of common stock exercisable within 60 days of February
2,
2007. William Troy has the power to vote and dispose of the shares
of
common stock beneficially owned by GCOF and GCP. The address for
Greywolf
Capital Management LP is 4 Manhattanville Road, Purchase, NY 10577.
|
(9)
|
Includes
shares beneficially owned by Millennium Global High Yield Fund
Limited
(the "High Yield Fund") and Millennium Global Natural Resources
Fund
Limited (the "Natural Resources Fund"). The High Yield Fund owns
2,668,000
shares of common stock and a warrant to acquire 1,334,000 shares
of common
stock exercisable within 60 days of February 2, 2007. The Natural
Resources Fund owns 667,000 shares of common stock and a warrant
to
acquire 333,500 shares of common stock exercisable within 60 days
of
February 2, 2007. Joseph Strubel has the power to vote and dispose
of the
shares of common stock beneficially owned by the High Yield Fund
and the
Natural Resources Fund. The address for Millennium Global Investments
Limited is 57-59 St. James Street, London, U.K., SW1A
1LD.
|
(10)
|
Includes
shares beneficially owned by US Global Investors - Global Resources
Fund
(the "Global Fund") and US Global Investors - Balanced Natural
Resources
Fund (the "Balanced Fund"). The Global Fund owns 3,100,000 shares
of
common stock and a warrant to acquire 1,550,000 shares of common
stock
exercisable within 60 days of February 2, 2007. The Balanced Fund
owns
233,333 shares of common stock and a warrant to acquire 116,667
shares of
common stock exercisable within 60 days of February 2, 2007. Evan
Smith,
portfolio manager, has the power to vote and dispose of the shares
of
common stock beneficially owned by the Global Fund and the Balanced
Fund.
The address for US Global Investors, Inc. is 7900 Callaghan Road,
San
Antonio, Texas 78229.
|
Summary
Compensation Table
|
|||||||||
Name
and principal position
|
Year
|
Salary
($) (1)
|
Bonus
($)
|
Stock
Awards ($)
|
Option
Awards ($) (2)(3)
|
Non-Equity
Incentive Plan Compensation ($)
|
Nonqualified
Deferred Compensation Earnings ($)
|
All
Other Compensation ($) (4)
|
Total
($)
|
Dana
Coffield
President
and Chief Executive Officer
|
2006
|
$154,458
|
0
|
0
|
$23,400
|
0
|
0
|
0
|
$177,858
|
2005
|
$154,386
|
0
|
0
|
$41,546
|
0
|
0
|
0
|
$195,932
|
|
James
Hart
Vice
President, Finance and Chief Financial Officer
|
2006
|
$154,458
|
0
|
0
|
$14,625
|
0
|
0
|
0
|
$169,083
|
2005
|
$154,386
|
0
|
0
|
$41,546
|
0
|
0
|
0
|
$195,392
|
|
Max
Wei
Vice
President, Operations
|
2006
|
$154,458
|
0
|
0
|
$11,700
|
0
|
0
|
0
|
$166,158
|
2005
|
$154,386
|
0
|
0
|
$41,546
|
0
|
0
|
0
|
$195,392
|
|
Rafael
Orunesu
President,
Gran Tierra Argentina
|
2006
|
$150,000
|
0
|
0
|
$11,700
|
0
|
0
|
$55,200
|
$216,900
|
2005
|
$150,000
|
0
|
0
|
$41,546
|
0
|
0
|
$55,200
|
$246,746
|
Dividend
Yield (per share)
|
$0.00
|
Volatility
(%)
|
85.1353%
|
Risk-free
interest rate (%)
|
5%
|
Expected
life
|
3
years
|
Name
|
Number
of Securities Underlying Options/SARs Granted (#)
|
Percent
of Total Options/SARs Granted to Employees In Fiscal
Year
|
Exercise
or Base Price ($/Sh) (1)
|
Expiration
Date
|
Dana
Coffield
|
200,000
|
22.9%
|
$1.27
|
November
8, 2016
|
James
Hart
|
125,000
|
14.3%
|
$1.27
|
November
8, 2016
|
Max
Wei
|
100,000
|
11.4%
|
$1.27
|
November
8, 2016
|
Rafael
Orunesu
|
100,000
|
11.4%
|
$1.27
|
November
8, 2016
|
Outstanding
Equity Awards at Fiscal Year-End
|
|||||||||
OPTION
AWARDS
|
STOCK
AWARDS
|
||||||||
Name
(a)
|
Number
of Securities Underlying Unexercised Options
(#)
Exercisable
(b)
|
Number
of Securities Underlying Unexercised Options
(#)
Unexercisable
(c)
|
Equity
Incentive Plan Awards: Number of Securities Underlying Unexercised
Unearned Options
(#)
(d)
|
Option
Exercise Price
($)
(e)
|
Option
Expiration Date
(f)
|
Number
of Shares or Units of Stock That Have Not Vested
(#)
(g)
|
Market
Value of Shares or Units of Stock That Have Not Vested
($)
(h)
|
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other
Rights
That Have Not Vested
(#)
(i)
|
Equity
Incentive Plan Awards: Market or Payout Value of Unearned Shares,
Units or
Other Rights That Have Not Vested
(#)
(j)
|
Dana
Coffield
|
54,167(1)
|
108,333(2)
|
$0.80
|
11/10/2015
|
|||||
200,000(3)
|
$1.27
|
11/8/2016
|
|||||||
James
Hart
|
54,167(1)
|
108,333(2)
|
$0.80
|
11/10/2015
|
|||||
125,000(3)
|
$1.27
|
11/8/2016
|
|||||||
Max
Wei
|
54,167(1)
|
108,333(2)
|
$0.80
|
11/10/2015
|
|||||
100,000(3)
|
$1.27
|
11/8/2016
|
|||||||
Rafael
Orunesu
|
54,167(1)
|
108,333(2)
|
$0.80
|
11/10/2015
|
|||||
100,000(3)
|
$1.27
|
11/8/2016
|
§ |
any
national securities exchange or quotation service on which the securities
may be listed or quoted at the time of
sale;
|
§ |
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
|
§ |
block
trades in which the broker-dealer will attempt to sell the shares
as agent
but may position and resell a portion of the block as principal to
facilitate the transaction;
|
§ |
purchases
by a broker-dealer as principal and resale by the broker-dealer for
its
account;
|
§ |
transactions
otherwise than on these exchanges or systems or in the over-the-counter
market;
|
§ |
through
the writing of options, whether such options are listed on an options
exchange or otherwise;
|
§ |
an
exchange distribution in accordance with the rules of the applicable
exchange;
|
§ |
privately
negotiated transactions;
|
§ |
short
sales;
|
§ |
broker-dealers
may agree with the selling stockholders to sell a specified number
of such
shares at a stipulated price per
share;
|
§ |
a
combination of any such methods of sale;
and
|
§ |
any
other method permitted pursuant to applicable
law.
|
· |
Warrants
representing the right to purchase 7,236,311 shares of our common
stock.
The outstanding warrants were issued on varying dates
between September 2005 and February 2006, and are exercisable
for 5 years from the date of issuance at an exercise price of $1.25
per share. The
shares of common stock underlying the outstanding warrants are being
registered under this registration
statement.
|
· |
Warrants
representing the right to purchase 25,000,030 shares of our common
stock. The outstanding warrants are exercisable until June 2011
at an exercise price of $1.75 per share. The warrants can be called
by us
if our common stock trades above $3.50 for 20 consecutive
days.
|
Page(s)
|
|
Consolidated
Financial Statements (Unaudited) for the three month and nine month
period ended September 30, 2006:
|
F-1
|
Consolidated
Statement of Operations
|
F-1
|
Consolidated
Balance Sheet
|
F-2
|
Consolidated
Statement of Cash Flows
|
F-3
|
Consolidated
Statement of Shareholders’
Equity
|
F-4
|
Notes
to the Consolidated Financial Statements
|
F-5
- F-19
|
Consolidated Financial Statements (Audited) for the nine months ended September 30,2006 |
F-20
|
Report
of Independent Registered Chartered Accountants
|
F-20
|
Consolidated
Statement of Operations
|
F-21
|
Consolidated
Balance Sheet
|
F-22
|
Consolidated
Statement of Cash Flows
|
F-23
|
Consolidated
Statement of Shareholders’
Equity
|
F-24
|
Notes
to the Consolidated Financial Statements
|
F-25
- F-41
|
Consolidated
Financial Statements for the period from incorporation on January
26, 2005
to December 31, 2005:
|
F-42
|
Report
of Independent Registered Chartered Accountants
|
F-42
|
Comments
by Independent Registered Chartered Accountants on Canada-United
States of
America Reporting Differences
|
F-42
|
Consolidated
Statement of Operations and Deficit
|
F-43
|
Consolidated
Balance Sheet
|
F-44
|
Consolidated
Statement of Cash Flows
|
F-45
|
Consolidated
Statement of Shareholders’
Equity
|
F-46
|
Notes
to the Consolidated Financial Statements
|
F-47
- F-59
|
Supplementary
Data (unaudited)
|
F-60
- F-62
|
Pro Forma Financial Statements for the nine months ended September 30, 2006 and the year ended December 31, 2005: |
F-63
|
Pro
Forma Statement of Operations for the period January 1, 2006
to September 30, 2006
|
F-64
|
Pro
Forma Statement of Operations for the period January 1, 2005 to
December
31, 2005
|
F-65
|
Notes
to Pro Forma Consolidated Financial Statements
|
F-66
- F-68
|
Financial Statements for Argosy Energy International, LP as of March 31, 2006 and for the period ended March 31, 2006 (Unaudited) |
F-69
|
Statement
of Income
|
F-70
|
Balance
Sheet
|
F-71
|
Statement
of Cash Flows
|
F-72
|
Statement
of Partner's Equity
|
F-73
|
Notes
to Financial Statements
|
F-74
- F-86
|
Financial Statements for Argosy Energy International, LP as of December 31, 2005 and 2004 |
F-87
|
Independent
Auditor's Report
|
F-88
|
Statements
of Income
|
F-89
|
Balance
Sheets
|
F-90
|
Statement
of Cash Flows
|
F-91
|
Statement
of Partner's Equity
|
F-92
|
Notes
to Financial Statements
|
F-93-
F-106
|
Supplemental
Oil and Gas Information
|
F-107-
F-113
|
Schedule
of Revenues, Royalties and Operating Cost corresponding to the
14%
interest
in the Palmar Largo joint venture for the
eight-month period ended
August 31, 2005:
|
F-114
|
Report
of Independent Registered Public Accounting Firm
|
F-115
|
Schedule
of Revenues, Royalties and Operating Cost
|
F-115
|
Notes
to the Schedule of Revenues, Royalties and Operating
Costs
|
F-116
- F-118
|
|
|
Schedule
of Revenues, Royalties and Operating Cost corresponding to the
14%
interest
in the Palmar Largo joint venture for the
years ended December 31,
2004 and 2003 (audited) and for the six months ended June 30, 2005
and 2004 (unaudited):
|
F-119
|
Report
of Independent Registered Public Accounting Firm
|
F-119
|
Schedule
of Revenues, Royalties and Operating Cost
|
F-120
|
Notes
to the Schedule of Revenues, Royalties and Operating
Cost
|
F-121
- F-124
|
Gran
Tierra Energy Inc.
Condensed
Consolidated Statement of Operations (Unaudited)
Stated
in US dollars
|
|||||||||||||
Three
months ended
September
30,
|
Nine
months ended
September
30, 2006 and the period from January 26 to September 30,
2005
|
||||||||||||
2006
$
|
2005
$
|
2006
$
|
2005
$
|
||||||||||
Revenue
|
|||||||||||||
Oil
and Natural Gas Sales
|
5,219,308
|
349,263
|
8,358,921
|
349,263
|
|||||||||
Interest
Revenue
|
175,641 |
—
|
195,816 |
—
|
|||||||||
5,394,949 | 349,263 | 8,554,737 | 349,263 | ||||||||||
EXPENSES
|
|||||||||||||
Operating
Expenses
|
1,259,888
|
125,000
|
2,702,507
|
125,000
|
|||||||||
General
and Administrative
|
1,764,856
|
414,397
|
4,256,303
|
668,908
|
|||||||||
Interest
Expenses
|
2,765
|
|
—
|
3,075
|
|
—
|
|||||||
Depreciation,
Depletion and Accretion
|
1,449,694
|
111,843
|
2,324,158
|
115,209
|
|||||||||
Foreign
Exchange (gain)/loss
|
273,684
|
(24,703
|
)
|
277,526
|
(21,064
|
)
|
|||||||
4,750,887
|
626,537
|
9,563,569
|
888,053
|
||||||||||
INCOME/(LOSS)
BEFORE INCOME TAXES
|
644,062
|
(277,274
|
)
|
(1,008,832
|
)
|
(538,790
|
)
|
||||||
Income
Taxes (Note 8)
|
710,417
|
7,370
|
848,200
|
7,370
|
|||||||||
NET
INCOME/(LOSS)
|
(66,355
|
)
|
(284,644
|
)
|
(1,857,032
|
)
|
(546,160
|
)
|
|||||
NET
EARNINGS/(LOSS) PER SHARE
|
|||||||||||||
Basic
|
0.00
|
(0.02
|
)
|
(0.03
|
)
|
(0.11
|
)
|
||||||
Diluted
|
0.00
|
(0.02
|
)
|
(0.03
|
)
|
(0.11
|
)
|
||||||
Weighted
average number of shares - Basic
|
95,455,759
|
12,083,333
|
63,043,998
|
4,903,297
|
|||||||||
Weighted
average number of shares - Diluted
|
130,612,674
|
12,083,333
|
98,200,913
|
4,903,297
|
Gran
Tierra Energy Inc.
Condensed
Consolidated Balance Sheets (Unaudited)
Stated
in US dollars
|
|||||||
September
30,
2006
$
|
December
31,
2005
$
|
||||||
ASSETS
|
|||||||
CURRENT
|
|||||||
Cash
and cash equivalents
|
18,796,084
|
2,221,456
|
|||||
Restricted
cash
|
12,617,263
|
400,427
|
|||||
Accounts
receivable
|
7,137,920
|
808,960
|
|||||
Inventory
|
586,943
|
447,012
|
|||||
Prepaid
expenses
|
247,073
|
42,701
|
|||||
Total
Current Assets
|
39,385,283
|
3,920,556
|
|||||
Taxes
Receivable
|
165,919
|
108,139
|
|||||
Property
Plant and Equipment (Note 5)
|
|||||||
Proven
oil and gas properties, net
|
25,859,978
|
7,886,914
|
|||||
Unproven
oil and gas properties not amortized
|
18,292,211
|
-
|
|||||
Other,
net
|
499,146
|
426,294
|
|||||
Goodwill
|
15,005,083
|
-
|
|||||
Deferred
Income Taxes
|
-
|
29,228
|
|||||
99,207,620
|
12,371,131
|
||||||
LIABILITIES
|
|||||||
CURRENT
|
|||||||
Accounts
payable
|
6,486,464
|
1,142,930
|
|||||
Accrued
liabilities
|
1,367,368
|
121,122
|
|||||
Taxes
Payable
|
1,708,955
|
-
|
|||||
9,562,787
|
1,264,052
|
||||||
Long
term Payables
|
76,147
|
-
|
|||||
Asset
Retirement Obligation (Note 7)
|
121,655
|
67,732
|
|||||
Deferred
Income Taxes (Note 8)
|
7,849,421
|
-
|
|||||
Deferred
Remittance Taxes
|
1,385,849
|
-
|
|||||
Total
Liabilities
|
18,995,859
|
1,331,784
|
|||||
SHAREHOLDERS’
EQUITY
|
|||||||
Share
capital (Note 6)
|
95,455
|
43,285
|
|||||
Additional
Paid in Capital
|
71,361,463
|
11,807,313
|
|||||
Warrants
(Note 6)
|
12,831,553
|
1,408,429
|
|||||
Deficit
|
(4,076,711
|
)
|
(2,219,680
|
)
|
|||
80,211,760
|
11,039,347
|
||||||
99,207,620
|
12,371,131
|
Gran
Tierra Energy Inc.
Condensed
Consolidated Statements of Cash Flows (Unaudited)
Stated
in US dollars
|
|||||||
Nine
Months ended September 30,
2006
$
|
For
the Period from January 26, 2005 to September 30,
2005
$
|
||||||
CASH
FLOWS RELATED TO THE
|
|||||||
FOLLOWING
ACTIVITIES:
|
|||||||
OPERATING:
|
|||||||
Net
(loss) earnings
|
(1,857,032
|
)
|
(546,160
|
)
|
|||
Adjustments
for:
|
|||||||
Depreciation,
Depletion and Accretion
|
2,324,158
|
115,209
|
|||||
Stock-based
compensation
|
203,306
|
-
|
|||||
Deferred
Income Taxes
|
123,193
|
-
|
|||||
Asset
Retirement Obligation, settled
|
(9,218
|
)
|
-
|
||||
Taxes
Receivable
|
(57,780
|
)
|
-
|
||||
Changes
in non-cash working capital (Note 9)
|
1,497,304
|
(192,732
|
)
|
||||
2,223,931
|
(623,683
|
)
|
|||||
FINANCING
|
|||||||
Short
term loan
|
-
|
6,655,223
|
|||||
Proceeds
from issuance of common shares and warrants, net of issuance
costs
|
70,826,137
|
1,713,412
|
|||||
70,826,137
|
8,368,635
|
||||||
INVESTING
|
|||||||
Property
and equipment additions, net of asset retirement obligation
assumed
|
(6,011,735
|
)
|
(6,934,542
|
)
|
|||
Other
|
(28,940
|
)
|
-
|
||||
Business
Combination, net of cash acquired (Note 3)
|
(38,217,930
|
)
|
-
|
||||
Restricted
Cash
|
(12,216,835
|
)
|
(377,491
|
)
|
|||
(56,475,440
|
)
|
(7,312,033
|
)
|
||||
NET
INCREASE IN CASH AND CASH EQUIVALENTS
|
16,574,628
|
432,919
|
|||||
CASH
AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
2,221,456
|
-
|
|||||
CASH
AND CASH EQUIVALENTS, END OF PERIOD
|
18,796,084
|
432,919
|
|||||
GRAN
TIERRA ENERGY INC.
Condensed
Consolidated Statement of Shareholders’ Equity
(unaudited)
Stated
in US dollars
|
|||||||
September
30, 2006
$
|
December
31, 2005
$
|
||||||
Share
Capital
|
|||||||
Balance
beginning of period
|
43,285
|
-
|
|||||
Issue
of common shares
|
52,170
|
43,285
|
|||||
Balance
end of period
|
95,455
|
43,285
|
|||||
Additional
paid-in-capital
|
|||||||
Balance
beginning of period
|
11,807,313
|
-
|
|||||
Issue
of common shares
|
59,350,844
|
11,754,402
|
|||||
Stock-based
compensation expense
|
203,306
|
52,911
|
|||||
Balance
end of period
|
71,361,463
|
11,807,313
|
|||||
Warrants
|
|||||||
Balance
beginning of period
|
1,408,429
|
-
|
|||||
Issue
of warrants
|
11,476,118
|
1,408,429
|
|||||
Redemption
of warrants
|
(52,994
|
)
|
-
|
||||
Balance
end of period
|
12,831,553
|
1,408,429
|
|||||
Deficit
|
|||||||
Balance
beginning of period
|
(2,219,680
|
)
|
-
|
||||
Net
loss
|
(1,857,032
|
)
|
(2,219,680
|
)
|
|||
Balance
end of period
|
(4,076,712
|
)
|
(2,219,680
|
)
|
|||
·
|
raise
additional capital through issuance of debt. The Company is currently
negotiating a debt facility that would provide capital for future
expansion activities.
|
·
|
build
a portfolio of production, development, and exploration opportunities
using additional capital raised and cash provided by future operating
activities.
|
3.
|
BUSINESS
COMBINATION
|
$
|
||||
Cash
Paid, net
|
36,414,385
|
|||
Common
Shares Issued
|
1,305,971
|
|||
Transaction
Costs
|
497,574
|
|||
Total
Purchase Price
|
38,217,930
|
|||
Purchase
Price allocated:
|
||||
Oil
and Gas Assets
|
32,553,211
|
|||
Goodwill
(1)
|
15,005,083
|
|||
Accounts
Receivable
|
5,361,887
|
|||
Inventories
|
567,355
|
|||
Long
Term Investments
|
6,772
|
|||
Accounts
Payable and Accrued Liabilities
|
(6,085,109
|
)
|
||
Long
Term Liabilities
|
(49,763
|
)
|
||
Deferred
Tax Liabilities
|
(9,141,506
|
)
|
||
Total
Purchase Price allocated
|
38,217,930
|
$
|
||||
Oil
and Gas assets (Decrease)
|
(8,005,709
|
)
|
||
Goodwill
Increase
|
1,411,303
|
|||
Deferred
Tax Liabilities Decrease
|
6,097,406
|
|||
Inventories
Increase
|
497,000
|
|||
Total
Change
|
-
|
2006
|
2005
|
||||||
Revenue
|
15,780,000
|
12,950,000
|
|||||
Net
Income (loss)
|
865,000
|
1,569,000
|
|
||||
Earnings
per share (Basic)
|
0.01
|
0.04
|
|
||||
Earnings
per share (diluted)
|
0.01
|
0.03
|
|
Third
Quarter, 2006
|
Nine
months ended September 30, 2006
|
||||||||||||||||||
Colombia
|
Argentina
|
Total
|
Colombia
|
Argentina
|
Total
|
||||||||||||||
Revenues
|
3,616,833
|
1,602,474
|
5,219,308
|
4,077,035
|
4,281,885
|
8,358,921
|
|||||||||||||
Depreciation,
Depletion and Accretion
|
1,042,234
|
394,520
|
1,436,755
|
1,164,560
|
1,125,302
|
2,289,863
|
|||||||||||||
Segment
Income (loss) before income taxes
|
1,385,561
|
88,950
|
1,474,511
|
1,560,233
|
270,492
|
1,830,725
|
|||||||||||||
Segment
Capital Expenditures
|
3,741,500
|
844,563
|
4,586,063
|
3,818,500
|
2,086,063
|
5,904,563
|
Third
Quarter, 2005
|
Nine
months ended September 30, 2005
|
||||||||||||||||||
Colombia
|
Argentina
|
Total
|
Colombia
|
Argentina
|
Total
|
||||||||||||||
Revenues
|
-
|
349,263
|
349,263
|
-
|
349,263
|
349,263
|
|||||||||||||
Depreciation,
Depletion and Accretion
|
-
|
113,000
|
113,000
|
-
|
113,000
|
113,000
|
|||||||||||||
Segment
Income before income taxes
|
-
|
21,055
|
21,055
|
-
|
21,055
|
21,055
|
|||||||||||||
Segment
Capital Expenditures
|
-
|
6,884,426
|
6,884,426
|
-
|
6,884,426
|
6,884,426
|
September
30, 2006
|
December
31, 2005
|
||||||||||||||||||
Colombia
|
Argentina
|
Total
|
Colombia
|
Argentina
|
Total
|
||||||||||||||
Property,
Plant and Equipment, net
|
35,211,746
|
9,234,430
|
44,446,176
|
-
|
8,209,556
|
8,209,556
|
|||||||||||||
Goodwill
|
15,005,083
|
-
|
15,005,083
|
-
|
-
|
-
|
Third
Quarter, 2006
|
Nine
months ended September 30, 2006
|
||||||
Income
before income taxes for reportable segments
|
1,474,511
|
1,830,725
|
|||||
Corporate
Expenses
|
(830,449
|
)
|
(2,839,557
|
)
|
|||
Consolidated
income (loss) before income taxes
|
644,062
|
(1,008,832
|
)
|
Third
Quarter, 2005
|
Period
from January 26, 2005 to September 30, 2005
|
||||||
Income
before income taxes for reportable segments
|
21,055
|
21,055
|
|||||
Corporate
Expenses
|
294,328
|
555,844
|
|||||
Consolidated
income (loss) before income taxes
|
(273,273
|
)
|
(534,789
|
)
|
Third
Quarter, 2006
|
Nine
months ended September 30, 2006
|
||||||
Total
capital expenditures for reportable segments
|
4,586,063
|
5,904,563
|
|||||
Corporate
capital expenditures
|
31,845
|
107,172
|
|||||
Consolidated
capital expenditures
|
4,617,908
|
6,011,735
|
Third
Quarter,
2005 |
Period
from
January 26, 2005 to September 30, 2005 |
||||||
Total
capital expenditures for reportable segments
|
6,884,426
|
6,884,426
|
|||||
Corporate
capital expenditures
|
50,116
|
50,116
|
|||||
Consolidated
capital expenditures
|
6,934,542
|
6,934,542
|
September
30, 2006
|
December
31, 2005
|
||||||
Property,
Plant and Equipment, net for reportable segments
|
44,446,176
|
8,209,556
|
|||||
Corporate
property, plant and equipment, net
|
205,158
|
103,652
|
|||||
Consolidated
property, plant and equipment, net
|
44,651,335
|
8,313,208
|
September
30, 2006
|
||||||||||
Cost
$
|
Accumulated
Depletion
and Depreciation
$
|
Net
Book Value
$
|
||||||||
Oil
and natural gas properties
|
|
|
|
|
||||||
Proven
|
28,307,817
|
(2,682,656
|
)
|
25,625,161
|
||||||
Unproven
|
18,292,211
|
-
|
18,292,211
|
|||||||
Materials
and supplies
|
234,817
|
-
|
234,817
|
|||||||
Furniture
and Fixtures
|
656,192
|
(461,461
|
)
|
194,731
|
||||||
Computer
equipment
|
485,763
|
(205,167
|
)
|
280,596
|
||||||
Automobiles
|
43,901
|
(20,082
|
)
|
23,819
|
||||||
48,020,701
|
(3,369,366
|
)
|
44,651,335
|
December
31, 2005
|
||||||||||
Cost
$
|
Accumulated
Depletion
and Depreciation
$
|
Net
Book Value
$
|
||||||||
Oil
and natural gas properties
|
8,331,767
|
(444,853
|
)
|
7,886,914
|
||||||
Materials
and supplies
|
300,177
|
-
|
300,177
|
|||||||
Furniture
and Fixtures
|
20,167
|
(4,805
|
)
|
15,362
|
||||||
Computer
equipment
|
73,682
|
(2,649
|
)
|
71,033
|
||||||
Automobiles
|
49,534
|
(9,812
|
)
|
39,722
|
||||||
8,775,327
|
(462,119
|
)
|
8,313,208
|
Block
|
Description
|
Acquisition
Cost
|
Exploration
Cost
|
Transfer
to Amortizable
|
Total
|
Timing
of Amortization
|
|||||||||||||
Rio
Magdelena
|
Popa
Exploration well
|
1,000,000
|
3,500,000
|
4,500,000
|
Q1
2007
|
||||||||||||||
Rio
Magdelena
|
Exploration
Land
|
4,052,301
|
(55,000
|
)
|
3,997,301
|
2008
|
|||||||||||||
Talora
|
Exploration
Land
|
402,720
|
20,000
|
(6,000
|
)
|
416,720
|
2008
|
||||||||||||
Chaza
|
Exploration
Land
|
2,588,912
|
38,000
|
2,626,912
|
2008
|
||||||||||||||
Mecaya
|
Exploration
Land
|
381,799
|
29,000
|
410,799
|
2008
|
||||||||||||||
Primavera
|
Exploration
Land
|
282,427
|
54,000
|
336,427
|
2008
|
||||||||||||||
Santana
|
Linda
Probable reserves
|
378,378
|
378,378
|
Q4
2007
|
|||||||||||||||
Santana
|
Mary
Probable reserves
|
1,010,077
|
1,010,077
|
Q4
2007
|
|||||||||||||||
Santana
|
Miraflor
Probable reserves
|
96,198
|
96,198
|
Q4
2007
|
|||||||||||||||
Santana
|
G&G
data
|
380,000
|
(380,000
|
)
|
-
|
||||||||||||||
Guayuyaco
|
Exploration
Land
|
3,791,841
|
67,000
|
3,858,841
|
2008
|
||||||||||||||
Guayuyaco
|
Probable
reserves
|
693,558
|
(33,000
|
)
|
660,558
|
Q4
2007
|
|||||||||||||
Guayuyaco
|
G&G
Data
|
1,044,000
|
(1,044,000
|
)
|
-
|
||||||||||||||
Guayuyaco
|
Seismic
|
431,000
|
(431,000
|
)
|
-
|
||||||||||||||
New
Projects
|
390,000
|
(390,000
|
)
|
-
|
|||||||||||||||
Total
|
16,923,211
|
3,708,000
|
(2,339,000
|
)
|
18,292,211
|
Number
of Shares
|
Amount
$
|
||||||
Balance,
January 1, 2006
|
43,285,112
|
43,285
|
|||||
Common
shares issued, at par value of $0.001 per share
|
52,170,647
|
52,170
|
|||||
Balance,
September 30, 2006
|
95,455,759
|
95,455
|
Number
of
Options
|
Weighted
Average Exercise Price ($/option)
|
||||||
Outstanding,
January 1, 2006
|
1,940,000
|
1.12
|
|||||
Granted
|
-
|
-
|
|||||
Cancelled
|
(110,000
|
)
|
1.12
|
||||
Balance,
September 30, 2006
|
1,830,000
|
1.12
|
Exercise
Price ($/option)
|
Number
of Options Outstanding
|
Weighted
Average Expiry (years)
|
|||||
$0.80
|
1,580,000
|
9.1
|
|||||
$2.62
|
250,000
|
9.2
|
|||||
Total
|
1,830,000
|
9.1
|
Dividend
yield ($ per share)
|
0.00
|
|||
Volatility
(%)
|
57.0
|
|||
Risk-free
interest rate (%)
|
2.33
|
|||
Expected
life (years)
|
3.0
|
|||
Forfeiture
percentage (% per year)
|
10.0
|
September
30,
|
December
31,
|
||||||
2006
|
2005
|
||||||
$
|
$
|
||||||
Balance
beginning of period
|
67,732
|
-
|
|||||
Obligations
assumed with property acquisitions
|
57,682
|
66,931
|
|||||
Expenditures
made on asset retirements
|
(9,218
|
)
|
-
|
||||
Accretion
|
5,459
|
801
|
|||||
Balance,
end of period
|
121,655
|
67,732
|
September
30,
|
September
30,
|
||||||
2006
|
2005
|
||||||
$
|
$
|
||||||
Loss
before income taxes
|
(1,008,832
|
)
|
(534,789
|
)
|
|||
Statutory
income tax rate
|
34
|
%
|
34
|
%
|
|||
Income
tax benefit expected
|
(343,003
|
)
|
(181,828
|
)
|
|||
Stock-based
compensation
|
69,124
|
-
|
|||||
Tax
losses in other jurisdictions, not recognized
|
1,122,079
|
189,197
|
|||||
Income
tax expense
|
848,200
|
7,369
|
September
30,
2006
$
|
||||
Property,
Plant and Equipment
|
8,006,421
|
|||
Other
long term assets and liabilities
|
(157,000
|
)
|
||
Total
|
7,849,421
|
September
30,
|
September
30,
|
||||||
2006
|
2005
|
||||||
$
|
$
|
||||||
Increase
in Accounts receivable
|
(986,272
|
)
|
(423,914
|
)
|
|||
Increase
in Prepaids
|
(185,586
|
)
|
-
|
||||
Decrease
in Inventory
|
110,073
|
-
|
|||||
Increase
in Accounts payable
|
1,032,811
|
147,176
|
|||||
Increase
in Accrued liabilities
|
568,874
|
76,637
|
|||||
Increase
in Taxes Payable
|
957,404 | 7,369 |
|
||||
Net
Change in Non-cash Working Capital
|
1,497,304
|
(192,732
|
)
|
$
|
||||
2006
|
54,831
|
|||
2007
|
177,097
|
|||
2008
|
118,887
|
|||
2009
|
89,330
|
|||
2010
|
81,888
|
|||
2011
|
6,824
|
|||
Total
minimum lease payments
|
528,857
|
$
|
||||
2006
|
3,420
|
|||
2007
|
13,680
|
|||
2008
|
8,958
|
|||
2009
|
4,366
|
|||
2010
|
3,874
|
|||
2011
|
646
|
|||
Total
minimum lease payments
|
34,944
|
Gran
Tierra Energy Inc.
Consolidated
Statement of Operations
Stated
in US dollars
|
||||
Nine
months ended
September
30, 2006
|
||||
$
|
||||
REVENUE
|
|
|||
Oil
and natural gas sales
|
8,358,921
|
|||
Interest
Revenue
|
195,816
|
|||
8,554,737
|
||||
EXPENSES
|
||||
Operating
Expenses
|
2,702,507
|
|||
General
and Administrative
|
4,256,303
|
|||
Interest
Expenses
|
3,075
|
|||
Depreciation,
Depletion and Accretion
|
2,324,158
|
|||
Foreign
Exchange (gain)/loss
|
277,526
|
|||
9,563,569
|
||||
INCOME/(LOSS)
BEFORE INCOME TAXES
|
(1,008,832
|
)
|
||
Income
Taxes (Note 8)
|
848,200
|
|||
NET
INCOME/(LOSS)
|
(1,857,032
|
)
|
||
NET
EARNINGS/(LOSS) PER SHARE
|
(0.03
|
)
|
||
Basic
|
(0.03
|
)
|
||
Diluted
|
(0.03
|
)
|
||
Weighted
average number of shares - Basic
|
63,043,998
|
|||
Weighted
average number of shares - Diluted
|
98,200,913
|
Gran
Tierra Energy Inc.
Consolidated
Balance Sheet
Stated
in US dollars
|
September
30,
2006
$
|
||||
ASSETS
|
||||
CURRENT
|
||||
Cash
and cash equivalents
|
18,796,084
|
|||
Restricted
cash
|
12,617,263
|
|||
Accounts
receivable
|
7,137,920
|
|||
Inventory
|
586,943
|
|||
Prepaid
expenses
|
247,073
|
|||
Total
Current Assets
|
39,385,283
|
|||
Taxes
Receivable
|
165,919
|
|||
Property
Plant and Equipment (Note 5)
|
||||
Proven
oil and gas properties, net
|
25,859,978
|
|||
Unproven
oil and gas properties not amortized
|
18,292,211
|
|||
Other,
net
|
499,146
|
|||
Goodwill
|
15,005,083
|
|||
Deferred
Income Taxes
|
-
|
|||
99,207,620
|
||||
LIABILITIES
|
||||
CURRENT
|
||||
Accounts
payable
|
6,486,464
|
|||
Accrued
liabilities
|
1,367,368
|
|||
Taxes
Payable
|
1,708,955
|
|||
9,562,787
|
||||
Long
term Payables
|
76,147
|
|||
Asset
Retirement Obligation (Note 7)
|
121,655
|
|||
Deferred
Income Taxes (Note 8)
|
7,849,421
|
|||
Deferred
Remittance Taxes
|
1,385,849
|
|||
Total
Liabilities
|
18,995,859
|
|||
SHAREHOLDERS’
EQUITY
|
||||
Share
capital (Note 6)
|
95,455
|
|||
Additional
Paid in Capital
|
71,361,463
|
|||
Warrants
(Note 6)
|
12,831,553
|
|||
Deficit
|
(4,076,711
|
)
|
||
80,211,760
|
||||
99,207,620
|
Gran
Tierra Energy Inc.
Consolidated
Statements of Cash Flows
Stated
in US dollars
|
||||
Nine
Months ended September 30,
2006
$
|
||||
CASH
FLOWS RELATED TO THE
|
||||
FOLLOWING
ACTIVITIES:
|
||||
OPERATING:
|
||||
Net
(loss) earnings
|
(1,857,032
|
)
|
||
Adjustments
for:
|
||||
Depreciation,
Depletion and Accretion
|
2,324,158
|
|||
Stock-based
compensation
|
203,306
|
|||
Deferred
Income Taxes
|
123,193
|
|||
Asset
Retirement Obligation, settled
|
(9,218
|
)
|
||
Taxes
Receivable
|
(57,780
|
)
|
||
Changes
in non-cash working capital (Note 9)
|
1,497,304
|
|||
2,223,931
|
||||
FINANCING
|
||||
Proceeds
from issuance of common shares and warrants, net of issuance
costs
|
70,826,137
|
|||
70,826,137
|
||||
INVESTING
|
||||
Property
and equipment additions, net of asset retirement obligations
assumed
|
(6,011,735
|
)
|
||
Other
|
(28,940
|
)
|
||
Business
Combination, net of cash acquired (Note 3)
|
(38,217,930
|
)
|
||
Restricted
Cash
|
(12,216,835
|
)
|
||
(56,475,440
|
)
|
|||
NET
INCREASE IN CASH AND CASH EQUIVALENTS
|
16,574,628
|
|||
CASH
AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
2,221,456
|
|||
CASH
AND CASH EQUIVALENTS, END OF PERIOD
|
18,796,084
|
|||
Supplemental
Cash Flow Information
|
||||
Cash
paid for interest
|
3,075
|
|||
Cash
paid for taxes
|
408,569
|
|||
GRAN
TIERRA ENERGY INC.
Condensed
Consolidated Statement of Shareholders’ Equity
Stated
in US dollars
|
September
30, 2006
$
|
||||
Share
Capital
|
||||
Balance
beginning of period
|
43,285
|
|||
Issue
of common shares
|
52,170
|
|||
Balance
end of period
|
95,455
|
|||
Additional
paid-in-capital
|
||||
Balance
beginning of period
|
11,807,313
|
|||
Issue
of common shares
|
59,350,844
|
|||
Stock-based
compensation expense
|
203,306
|
|||
Balance
end of period
|
71,361,463
|
|||
Warrants
|
||||
Balance
beginning of period
|
1,408,429
|
|||
Issue
of warrants
|
11,476,118
|
|||
Redemption
of warrants
|
(52,994
|
)
|
||
Balance
end of period
|
12,831,553
|
|||
Deficit
|
||||
Balance
beginning of period
|
(2,219,680
|
)
|
||
Net
loss
|
(1,857,032
|
)
|
||
Balance
end of period
|
(4,076,712
|
)
|
||
·
|
raise
additional capital through issuance of debt. The Company is currently
negotiating a debt facility that would provide capital for future
expansion activities.
|
·
|
build
a portfolio of production, development, and exploration opportunities
using additional capital raised and cash provided by future operating
activities.
|
Computer
equipment
|
30
|
%
|
||
Furniture
and Fixtures
|
30
|
%
|
||
Automobiles
|
30
|
%
|
3.
|
BUSINESS
COMBINATION
|
$
|
||||
Cash
Paid, net
|
36,414,385
|
|||
Common
Shares Issued
|
1,305,971
|
|||
Transaction
Costs
|
497,574
|
|||
Total
Purchase Price
|
38,217,930
|
|||
Purchase
Price allocated:
|
||||
Oil
and Gas Assets
|
32,553,211
|
|||
Goodwill
(1)
|
15,005,083
|
|||
Accounts
Receivable
|
5,361,887
|
|||
Inventories
|
567,355
|
|||
Long
Term Investments
|
6,772
|
|||
Accounts
Payable and Accrued Liabilities
|
(6,085,109
|
)
|
||
Long
Term Liabilities
|
(49,763
|
)
|
||
Deferred
Tax Liabilities
|
(9,141,506
|
)
|
||
Total
Purchase Price allocated
|
38,217,930
|
$
|
||||
Oil
and Gas assets (Decrease)
|
(8,005,709
|
)
|
||
Goodwill
Increase
|
1,411,303
|
|||
Deferred
Tax Liabilities Decrease
|
6,097,406
|
|||
Inventories
Increase
|
497,000
|
|||
Total
Change
|
-
|
2006
|
2005
|
||||||
Revenue
|
15,780,000
|
12,950,000
|
|||||
Net
Income (loss)
|
865,000
|
1,569,000
|
|||||
Earnings
per share (Basic)
|
0.01
|
0.04
|
|||||
Earnings
per share (diluted)
|
0.01
|
0.03
|
Nine
months ended September 30, 2006
|
||||||||||
Colombia
|
Argentina
|
Total
|
||||||||
Revenues
|
4,077,035
|
4,281,885
|
8,358,921
|
|||||||
Depreciation,
Depletion and Accretion
|
1,164,560
|
1,125,302
|
2,289,863
|
|||||||
Segment
Income (loss) before income taxes
|
1,560,233
|
270,492
|
1,830,725
|
|||||||
Segment
Capital Expenditures
|
3,818,500
|
2,086,063
|
5,904,563
|
September
30, 2006
|
||||||||||
Colombia
|
Argentina
|
Total
|
||||||||
Property,
Plant and Equipment, net
|
35,211,746
|
9,234,430
|
44,446,176
|
|||||||
Goodwill
|
15,005,083
|
-
|
15,005,083
|
Nine
months ended
September
30, 2006
|
||||
Income
before income taxes for reportable segments
|
1,830,725
|
|||
Corporate
Expenses
|
(2,839,557
|
)
|
||
Consolidated
(loss) before income taxes
|
(1,008,832
|
)
|
Nine
months ended
September
30, 2006
|
||||
Total
capital expenditures for reportable segments
|
5,904,563
|
|||
Corporate
capital expenditures
|
107,172
|
|||
Consolidated
capital expenditures
|
6,011,735
|
September
30, 2006
|
||||
Property,
Plant and Equipment, net for reportable segments
|
44,446,176
|
|||
Corporate
property, plant and equipment, net
|
205,158
|
|||
Consolidated
property, plant and equipment, net
|
44,651,335
|
5.
|
CAPITAL
ASSETS
|
September
30, 2006
|
||||||||||
Cost
$
|
Accumulated
Depletion
and Depreciation
$
|
Net
Book Value
$
|
||||||||
Oil
and natural gas properties
|
||||||||||
Proven
|
28,307,817
|
(2,682,656
|
)
|
25,625,161
|
||||||
Unproven
|
18,292,211
|
-
|
18,292,211
|
|||||||
Materials
and supplies
|
234,817
|
-
|
234,817
|
|||||||
Furniture
and Fixtures
|
656,192
|
(461,461
|
)
|
194,731
|
||||||
Computer
equipment
|
485,763
|
(205,167
|
)
|
280,596
|
||||||
Automobiles
|
43,901
|
(20,082
|
)
|
23,819
|
||||||
48,020,701
|
(3,369,366
|
)
|
44,651,335
|
Block
|
Description
|
Acquisition
Cost
|
Exploration
Cost
|
Transfer
to Amortizable
|
Total
|
Timing
of Amortization
|
|||||||||||||
Rio
Magdelena
|
Popa
Exploration well
|
1,000,000
|
3,500,000
|
4,500,000
|
Q1
2007
|
||||||||||||||
Rio
Magdelena
|
Exploration
Land
|
4,052,301
|
(55,000
|
)
|
3,997,301
|
2008
|
|||||||||||||
Talora
|
Exploration
Land
|
402,720
|
20,000
|
(6,000
|
)
|
416,720
|
2008
|
||||||||||||
Chaza
|
Exploration
Land
|
2,588,912
|
38,000
|
2,626,912
|
2008
|
Mecaya
|
Exploration
Land
|
381,799
|
29,000
|
410,799
|
2008
|
||||||||||||||
Primavera
|
Exploration
Land
|
282,427
|
54,000
|
336,427
|
2008
|
||||||||||||||
Santana
|
Linda
Probable reserves
|
378,378
|
378,378
|
Q4
2007
|
|||||||||||||||
Santana
|
Mary
Probable reserves
|
1,010,077
|
1,010,077
|
Q4
2007
|
|||||||||||||||
Santana
|
Miraflor
Probable reserves
|
96,198
|
96,198
|
Q4
2007
|
|||||||||||||||
Santana
|
G&G
data
|
380,000
|
(380,000
|
)
|
-
|
||||||||||||||
Guayuyaco
|
Exploration
Land
|
3,791,841
|
67,000
|
3,858,841
|
2008
|
||||||||||||||
Guayuyaco
|
Probable
reserves
|
693,558
|
(33,000
|
)
|
660,558
|
Q4
2007
|
|||||||||||||
Guayuyaco
|
G&G
Data
|
1,044,000
|
(1,044,000
|
)
|
-
|
||||||||||||||
Guayuyaco
|
Seismic
|
431,000
|
(431,000
|
)
|
-
|
||||||||||||||
New
Projects
|
390,000
|
(390,000
|
)
|
-
|
|||||||||||||||
Total
|
16,923,211
|
3,708,000
|
(2,339,000
|
)
|
18,292,211
|
Number
of Shares
|
Amount
$
|
||||||
Balance,
January 1, 2006
|
43,285,112
|
43,285
|
|||||
Common
shares issued, at par value of $0.001 per share
|
52,170,647
|
52,170
|
|||||
Balance,
September 30, 2006
|
95,455,759
|
95,455
|
Number
of Options
|
Weighted
Average Exercise Price ($/option)
|
||||||
Outstanding,
January 1, 2006
|
1,940,000
|
1.12
|
|||||
Granted
|
-
|
-
|
|||||
Cancelled
|
(110,000
|
)
|
1.12
|
||||
Balance,
September 30, 2006
|
1,830,000
|
1.12
|
Exercise
Price ($/option)
|
Number
of Options Outstanding
|
Weighted
Average Expiry (years)
|
|||||
$0.80
|
1,580,000
|
9.1
|
|||||
$2.62
|
250,000
|
9.2
|
|||||
Total
|
1,830,000
|
9.1
|
Dividend
yield ($ per share)
|
0.00
|
|||
Volatility
(%)
|
57.0
|
|||
Risk-free
interest rate (%)
|
2.33
|
|||
Expected
life (years)
|
3.0
|
|||
Forfeiture
percentage (% per year)
|
10.0
|
September
30,
|
||||
2006
|
||||
$
|
||||
Balance
beginning of period
|
67,732
|
|||
Obligations
assumed with property acquisitions
|
57,682
|
|||
Expenditures
made on asset retirements
|
(9,218
|
)
|
||
Accretion
|
5,459
|
|||
Balance,
end of period
|
121,655
|
September
30,
|
|
2006
|
|
$
|
|
Loss
before income taxes
|
(1,008,832)
|
Statutory
income tax rate
|
34%
|
Income
tax benefit expected
|
(343,003)
|
Stock-based
compensation
|
69,124
|
Tax
losses from other jurisdictions not recognized
|
1,122,079
|
Income
tax expense
|
848,200
|
September
30,
2006
$
|
||||
Property,
Plant and Equipment
|
8,006,421
|
|||
Other
long term assets and liabilities
|
(157,000
|
)
|
||
Total
|
7,849,421
|
September
30,
|
||||
2006
|
||||
$
|
||||
Increase
in Accounts receivable
|
(986,272
|
)
|
||
Increase
in Prepaids
|
(185,586
|
)
|
||
Decrease
in Inventory
|
110,073
|
Increase
in Accounts payable
|
1,032,811
|
|||
Increase
in Accrued liabilities
|
568,874
|
|||
Increase
in Taxes Payable
|
957,404
|
|||
Net
Change in Non-cash Working Capital
|
1,497,304
|
$
|
||||
2006
|
54,831
|
|||
2007
|
177,097
|
|||
2008
|
118,887
|
|||
2009
|
89,330
|
|||
2010
|
81,888
|
|||
2011
|
6,824
|
|||
Total
minimum lease payments
|
528,857
|
$
|
||||
2006
|
3,420
|
|||
2007
|
13,680
|
|||
2008
|
8,958
|
|||
2009
|
4,366
|
|||
2010
|
3,874
|
|||
2011
|
646
|
|||
Total
minimum lease payments
|
34,944
|
Calgary, Alberta, Canada | /s/ Deloitte & Touche LLP | ||
March 3, 2006 | Independent Registered Chartered Accountants | ||
Calgary, Alberta, Canada |
/s/
Deloitte & Touche
LLP
|
March 3, 2006 |
Independent
Registered Chartered
Accountants
|
GRAN
TIERRA ENERGY INC.
Consolidated
Statement of Operations
Period
from Incorporation on January 26, 2005 to December 31,
2005
(Stated
in US dollars)
|
$
|
||||
REVENUES
|
1,059,297
|
|||
EXPENSES
|
||||
Operating
|
395,287
|
|||
General
and administrative
|
2,482,070
|
|||
Depletion,
depreciation and accretion
|
462,119
|
|||
Foreign
exchange gain
|
(31,271
|
)
|
||
3,308,205
|
||||
LOSS
BEFORE INCOME TAXES
|
(2,248,908
|
)
|
||
INCOME
TAXES
|
29,228
|
|||
NET
LOSS
|
(2,219,680
|
)
|
||
BASIC
AND DILUTED NET LOSS PER SHARE
|
(0.16
|
)
|
||
WEIGHTED
AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING - BASIC AND DILUTED
|
13,538,149
|
GRAN
TIERRA ENERGY INC.
Consolidated
Balance Sheet
December
31, 2005
(Stated
in US dollars)
|
||||
$
|
||||
ASSETS
|
||||
CURRENT
|
||||
Cash
|
2,221,456
|
|||
Restricted
cash
|
400,427
|
|||
Accounts
receivable
|
808,960
|
|||
Prepaid
expenses and deposits
|
42,701
|
|||
Inventory
|
447,012
|
|||
3,920,556
|
||||
Taxes
receivable
|
108,139
|
|||
Capital
assets (Note 3)
|
8,313,208
|
|||
Deferred
income taxes (Note 6)
|
29,228
|
|||
12,371,131
|
||||
LIABILITIES
|
||||
CURRENT
|
||||
Accounts
payable
|
1,142,930
|
|||
Accrued
liabilities
|
121,122
|
|||
1,264,052
|
||||
Asset
retirement obligations (Note 5)
|
67,732
|
|||
SHAREHOLDERS’
EQUITY
|
||||
Share
capital (Note 4)
(24,554,953
common shares and 18,730,159 exchangeable shares, par value $0.001
per
share, issued and outstanding)
|
43,285
|
|||
Additional
paid-in-capital
|
11,807,313
|
|||
Warrants
|
1,408,429
|
|||
Deficit
|
(2,219,680
|
)
|
||
11,039,347
|
||||
12,371,131
|
||||
GRAN
TIERRA ENERGY INC.
Consolidated
Statement of Cash Flows
Period
from Incorporation on January 26, 2005 to December 31,
2005
(Stated
in US dollars)
|
||||
$
|
||||
CASH
FLOWS RELATED TO THE FOLLOWING
ACTIVITIES:
|
||||
OPERATING
|
||||
Net
loss
|
(2,219,680
|
)
|
||
Add
(deduct) items not involving cash:
|
||||
Depletion,
depreciation and accretion
|
462,119
|
|||
Deferred
income taxes
|
(29,228
|
)
|
||
Stock-based
compensation
|
52,911
|
|||
Tax
receivable
|
(108,139
|
)
|
||
Changes
in non-cash working capital (Note 7)
|
|
|
||
Increase
in accounts receivable
|
(808,960 | ) | ||
Increase
in prepaid expenses
|
(42,701 | ) | ||
Increase
in inventory
|
(447,012 | ) | ||
Increase
in accounts payable
|
1,142,930 | |||
Increase
in accrued liabilities
|
121,122 | |||
(1,876,638
|
)
|
|||
FINANCING
|
||||
Proceeds
from issuance of common shares and warrants, net of issuance
costs
|
13,206,116
|
|||
INVESTING
|
||||
Purchase
of capital assets
|
(8,707,595
|
)
|
||
Restricted
cash
|
(400,427
|
)
|
||
(9,108,022
|
)
|
|||
NET
INCREASE IN CASH
|
2,221,456
|
|||
CASH,
BEGINNING OF PERIOD
|
-
|
|||
CASH,
END OF PERIOD
|
2,221,456
|
|||
Supplemental
cash flow disclosures:
|
||||
Cash
paid for interest
|
-
|
|||
Cash
paid for taxes
|
-
|
GRAN
TIERRA ENERGY INC.
Consolidated
Statement of Shareholders’ Equity
Period
from Incorporation on January 26, 2005 to December 31,
2005
(Stated
in US dollars)
|
||||
$
|
||||
Share
Capital
|
||||
Balance
beginning of period
|
-
|
|||
Issue
of common shares
|
43,285
|
|||
Balance
end of period
|
43,285
|
|||
Additional
paid-in-capital
|
||||
Balance
beginning of period
|
-
|
|||
Issue
of common shares
|
11,754,402
|
|||
Stock-based
compensation expense
|
52,911
|
|||
Balance
end of period
|
11,807,313
|
|||
Warrants
|
||||
Balance
beginning of period
|
-
|
|||
Issue
of warrants
|
1,408,429
|
|||
Balance
end of period
|
1,408,429
|
|||
Deficit
|
||||
Balance
beginning of period
|
-
|
|||
Net
loss
|
(2,219,680
|
)
|
||
Balance
end of period
|
(2,219,680
|
)
|
||
· |
raise
additional capital through the sale and issuance of common shares.
The
Company closed a private offering of common stock on February
2, 2006 for
762,500 shares of common stock and warrants to acquire 381,250
shares of
common stock, for proceeds of $610,000;
and
|
· |
build
a portfolio of production, development, step-out and more speculative
exploration opportunities using additional capital raised and
cash
provided by future operating activities.
|
Computer
equipment
|
30%
|
Furniture
and Fixtures
|
30%
|
Automobiles
|
30%
|
· |
abnormal
amounts of idle facility expense, freight, handling costs and wasted
material (spoilage) should be recognized as current-period charges;
and
|
· |
the
allocation of fixed production overhead to inventory based on the
normal
capacity of the production facilities is
required.
|
2005
|
||||||||||
Cost
$
|
Accumulated
Depletion
and Depreciation
$
|
Net
Book Value
$
|
||||||||
Oil
and natural gas properties
|
8,331,767
|
(444,853
|
)
|
7,886,914
|
||||||
Materials
and supplies
|
300,177
|
-
|
300,177
|
|||||||
Furniture
and Fixtures
|
20,167
|
(4,805
|
)
|
15,362
|
||||||
Computer
equipment
|
73,682
|
(2,649
|
)
|
71,033
|
||||||
Automobiles
|
49,534
|
(9,812
|
)
|
39,722
|
||||||
8,775,327
|
(462,119
|
)
|
8,313,208
|
Number
of Shares
|
Amount
$
|
||||||
Balance,
beginning of period
|
-
|
-
|
|||||
Shares
acquired at closing of share exchange, at par value of $0.001 per
share
|
42,491,462
|
42,491
|
|||||
Shares acquired subsequent to closing of share exchange, at par value $0.001 per share | 793,650 | 794 | |||||
Balance,
end of period
|
43,285,112
|
43,285
|
Dividend
yield ($ per share)
|
0.00
|
|
Volatility
(%)
|
57.0
|
|
Risk-free
interest rate (%)
|
2.33
|
|
Expected
life (years)
|
3.0
|
Number
of Options
|
Weighted
Average Exercise Price ($/option)
|
||||||
Outstanding,
beginning of period
|
-
|
-
|
|||||
Granted
|
1,940,000
|
1.12
|
|||||
Balance,
end of period
|
1,940,000
|
1.12
|
Exercise
Price ($/option)
|
Number
of Options Outstanding
|
Weighted
Average Expiry (years)
|
|
$0.80
|
1,600,000
|
9.9
|
|
$2.62
|
340,000
|
10.0
|
|
Total
Options
|
1,940,000
|
9.9
|
Dividend
yield ($ per share)
|
0.00
|
|||
Volatility
(%)
|
57.0
|
|||
Risk-free
interest rate (%)
|
2.33
|
|||
Expected
life (years)
|
3.0
|
|||
Forfeiture
percentage (% per year)
|
10.0
|
2005
|
||||
$
|
||||
Balance
beginning of period
|
-
|
|||
Obligations
assumed with property acquisitions
|
66,931
|
|||
Expenditures
made on asset retirements
|
-
|
|||
Accretion
|
801
|
|||
Revisions
to estimates
|
-
|
|||
Balance,
end of period
|
67,732
|
2005
|
||||
$
|
||||
Loss
before income taxes
|
(2,248,908
|
)
|
||
Statutory
income tax rate
|
34
|
%
|
||
Income
tax benefit
|
(764,628
|
)
|
||
Stock-based
compensation
|
17,990
|
|||
Valuation
allowance
|
717,410
|
|||
Deferred
income tax recovery and deferred tax asset
|
(29,228
|
)
|
2005
|
||||
$
|
||||
Increase
in accounts receivable
|
(808,960
|
)
|
||
Increase
in prepaid expenses
|
(42,701
|
)
|
||
Increase
in inventory
|
(447,012
|
)
|
||
Increase
in accounts payable
|
1,142,930
|
|||
Increase
in accrued liabilities
|
121,122
|
|||
(34,621
|
)
|
$
|
||||
2006
|
7,578
|
|||
Total
minimum lease payments
|
7,578
|
$
|
||||
2006
|
88,240
|
|||
2007
|
105,888
|
|||
2008
|
85,888
|
|||
2009
|
81,888
|
|||
2010
|
81,888
|
|||
2011
|
6,824
|
|||
Total
minimum lease payments
|
450,616
|
Oil
|
Gas
|
||||||
(barrels)
|
(thousand
cubic feet) |
||||||
Proved
developed and undeveloped reserves, beginning of period
|
-
|
-
|
|||||
Revisions
of previous estimates
|
-
|
-
|
|||||
Improved
recovery
|
-
|
-
|
|||||
Purchase
of reserves in place
|
618,703
|
84,693
|
|||||
Extensions
and discoveries
|
-
|
-
|
|||||
Production
|
(36,011
|
)
|
(60,229
|
)
|
|||
Sales
of reserves in place
|
-
|
-
|
|||||
Proved
developed and undeveloped reserves, end of period
|
582,692
|
24,464
|
|||||
Proved
developed reserves, end of period
|
463,892
|
24,464
|
$
|
||||
Unproved
oil and gas properties
|
12,588
|
|||
Proved
oil and gas properties
|
8,319,179
|
|||
8,331,767
|
||||
Accumulated
depletion, depreciation and amortization
|
(444,853
|
)
|
||
Capitalized
costs
|
7,886,914
|
|||
$
|
||||
Property
acquisition costs
|
||||
Proved
|
7,087,858
|
|||
Unproved
|
12,588
|
|||
Exploration
costs
|
-
|
|||
Development
costs
|
1,231,321
|
|||
Loans Incurred |
8,331,767
|
|||
$
|
||||
Net
sales
|
1,059,297
|
|||
Production
costs
|
395,287
|
|||
Depletion,
depreciation and accretion
|
444,853
|
|||
219,157
|
||||
Income
taxes
|
76,705
|
|||
Results
of operations for producing activities
|
142,452
|
· |
no
economic value is attributed to probable and possible
reserves;
|
· |
use
of a 10% discount rate is arbitrary;
and
|
· |
prices
change constantly from year-end
levels.
|
$
|
||||
Future
cash inflows
|
25,445,000
|
|||
Future
production and development costs
|
(11,965,000
|
)
|
||
Future
income taxes
|
(1,575,000
|
)
|
||
Future
net cash flows
|
11,905,000
|
|||
10%
discount factor
|
(2,725,000
|
)
|
||
Standardized
measure
|
9,180,000
|
|||
· |
Gran
Tierra Energy’s audited consolidated financial statements for the
period
from incorporation on January 26, 2005 to December
31,
2005.
|
· |
Gran
Tierra Energy’s unaudited consolidated financial statements for
the nine months ended September 30,
2006.
|
· |
Argosy’s
audited financial statements for the year ended December
31,
2005;
|
· |
Audited
schedules of revenues, royalties and operating costs
of the Palmar Largo
Property for the eight months ended August 31,
2005.
|
Gran
Tierra Energy Inc.
Pro
Forma Statement of Operations (unaudited)
For
the period January 1 to September 30, 2006
Stated
in thousands of US dollars
|
Gran
Tierra Energy
|
Argosy
Energy
|
Pro
forma Adjustments
|
Pro
forma Consolidated
|
||||||||||
Revenue
|
|||||||||||||
Oil
and Natural Gas Sales
|
8,359
|
7,226
|
--
|
15,585
|
|||||||||
Interest
Revenue
|
196
|
--
|
--
|
196
|
|||||||||
8,555
|
7,226
|
--
|
15,780
|
||||||||||
Expenses
|
|||||||||||||
Operating
|
2,703
|
891
|
--
|
3,594
|
|||||||||
General
and Administrative
|
4,256
|
520
|
--
|
4,776
|
|||||||||
Other
Income and expenses, net
|
--
|
(235
|
)
|
--
|
(235
|
)
|
|||||||
Interest
Expense
|
3
|
--
|
--
|
3
|
|||||||||
Depletion,
depreciation and accretion (Note 2a)
|
2,324
|
372
|
1,523
|
4,219
|
|||||||||
Foreign
exchange gain
|
278
|
--
|
--
|
278
|
|||||||||
9,564
|
1,548
|
1,523
|
12,635
|
||||||||||
Earnings
(loss) before income taxes
|
(1,009
|
)
|
5,678
|
(1,523
|
)
|
3,145
|
|||||||
Provision
for income taxes (Note 2b)
|
(848
|
)
|
(1,966
|
)
|
533
|
(2,281
|
)
|
||||||
Net
Earnings (loss) for the period
|
(1,857
|
)
|
3,712
|
(990
|
)
|
865
|
|||||||
Basic
Earnings (loss) per share
|
(0.02
|
)
|
0.01
|
||||||||||
Diluted
Earnings (loss) per share
|
(0.02
|
)
|
0.01
|
||||||||||
Weighted
Average Shares - Basic
|
63,043,998
|
25,870,647
|
88,914,645
|
||||||||||
Weighted
Average Shares - Diluted
|
98,200,913
|
25,870,647
|
124,071,560
|
||||||||||
Gran
Tierra Energy Inc.
Pro
Forma Statement of Operations (unaudited)
For
the period January 1 to December 31, 2005
Stated
in thousands of US dollars
|
|
Gran
Tierra Energy
|
Argosy
Energy |
Pro
Forma Adjustment
|
Pro
Forma Consolidated
Subtotal
|
Palmar
Largo Property
|
Pro
Forma Consolidated
|
|||||||||||||
Revenue
|
1,059
|
11,891
|
-
|
12,950
|
2,560
|
15,510
|
|||||||||||||
Operating
Expense (Note 2c)
|
395
|
2,452
|
-
|
2,847
|
1,081
|
3,928
|
|||||||||||||
664
|
9,439
|
-
|
10,103
|
1,479
|
11,582
|
||||||||||||||
Other
Expenses
|
|
||||||||||||||||||
General
and Administrative
|
2,482
|
1,082
|
-
|
3,564
|
-
|
-
|
|||||||||||||
Depreciation,
Depletion and Accretion (Note 2d)
|
462
|
697
|
2,322
|
3,481
|
-
|
-
|
|||||||||||||
Foreign
Exchange Gain
|
(31
|
)
|
(31
|
)
|
-
|
-
|
|||||||||||||
Other
Income, Net
|
(449
|
)
|
-
|
(449
|
)
|
-
|
-
|
||||||||||||
2,913
|
1,330
|
2,322
|
6,565
|
-
|
-
|
||||||||||||||
Earnings
(Loss) Before Income Taxes
|
(2,249
|
)
|
8,109
|
(2,322
|
)
|
3,538
|
-
|
-
|
|||||||||||
Provision
For Income and Remittance Taxes (Note 2e)
|
29
|
(2,892
|
)
|
894
|
(1,969
|
)
|
-
|
-
|
|||||||||||
Earnings
(Loss) for the period
|
(2,220
|
)
|
5,217
|
(1,428
|
)
|
1,569
|
-
|
-
|
|||||||||||
Basic
Earnings Per Share (Note 4)
|
(0.06
|
)
|
-
|
-
|
0.04
|
-
|
-
|
||||||||||||
Diluted
Earnings Per Share (Note 4)
|
(0.06
|
)
|
-
|
-
|
0.03
|
-
|
-
|
||||||||||||
Weighted
Average Shares - Basic
|
13,538,149
|
25,870,647
|
39,408,796
|
||||||||||||||||
Weighted
Average Shares - Diluted
|
20,680,702
|
25,870,647
|
46,551,349
|
GRAN
TIERRA ENERGY, INC.
Notes
to the Pro forma Consolidated Financial Statements
For
the Nine-Month Period Ended September 30, 2006 and
the
Year
Ended December 31, 2005
(Unaudited)
(Tabular
amounts expressed in thousands of US dollars)
|
GRAN
TIERRA ENERGY, INC.
Notes
to the Pro forma Consolidated Financial Statements
For the
Nine-Month Period Ended September 30, 2006 and the
Year
Ended December 31, 2005
(Unaudited)
(Tabular
amounts expressed in thousands of US dollars)
|
2.
|
PRO FORMA ADJUSTMENTS TO THE CONSOLIDATED STATEMENTS
OF
OPERATIONS
|
a. |
Depreciation,
depletion and accretion expense (DD&A) has been increased by $1,523
thousand to reflect the additional DD&A from the Argosy asset purchase
from January 1 to June 20, 2006. Additional
DD&A is due to the increased cost basis of Argosy
assets from
recording them at full value on the acquisition
date (of January 1, 2005
for pro forma purposes.)
|
b. |
Provision
for income taxes has been decreased by $533 thousand
to account for the
tax effects of operating income and DD&A adjustment related to the
Argosy acquisition.
|
c. |
Costs
incurred to operate and maintain wells and related
equipment and
facilities.
|
d. |
DD&A
has been adjusted to reflect the effect of the
Argosy acquisition in the
amount of $2,322 thousand. An adjustment of $704
thousand would be
associated with the Palmar Largo acquisition. Additional
DD&A is due to the increased cost basis of Argosy
and Palmar Largo
assets from recording them at full value on the
acquisition date (of
January 1, 2005 for pro forma
purposes.)
|
e. |
Provision
for income taxes has been decreased by $894 thousand
to account for the
tax effects of operating income and DD&A adjustment related to the
Argosy acquisition.
|
3.
|
PURCHASE PRICE
ALLOCATION
|
$
|
||||
Cash
paid, net of cash acquired
|
36,414
|
|||
Shares
issued
|
1,306
|
|||
Transaction
costs
|
498
|
|||
38,218 | ||||
Purchase
Price Allocated
|
||||
Oil
& natural gas assets
|
32,553
|
|||
Goodwill
|
15,005
|
|||
Accounts
Receivable
|
5,362
|
|||
Inventories
|
568
|
|||
Long
term investments
|
7
|
|||
Accounts
Payable and Accrued Liabilities
|
(6,085
|
)
|
||
Long
term Payable
|
(50
|
)
|
||
Deferred
Tax Liabilities
|
(9,142
|
)
|
||
38,218
|
$
|
||||
Cash
paid
|
7,000
|
|||
Purchase
price allocated
|
||||
Oil
and natural gas properties
|
7,110
|
|||
Asset
retirement obligations
|
(110
|
)
|
||
7,000
|
4.
|
BASIC
AND DILUTED EARNINGS PER
SHARE
|
ARGOSY
ENERGY INTERNATIONAL, LP
|
||||||||||||
Statements
of Income (Unaudited)
|
||||||||||||
For
the Three Months Ended March 31, 2006 and 2005
|
||||||||||||
(Expressed
in thousands of US dollars)
|
2006
|
2005
|
||||||
Oil
sales to Ecopetrol
|
$
|
3,575
|
1,521
|
||||
Operating
cost (note 8)
|
367
|
364
|
|||||
Depreciation,
depletion and amortization
|
190
|
80
|
|||||
General
and administrative expenses
|
282
|
148
|
|||||
839
|
592
|
||||||
Operating
profit
|
2,736
|
929
|
|||||
Other
income, net
|
79
|
116
|
|||||
Income
before income and remittance taxes
|
2,815
|
1,045
|
|||||
Current
income tax (note 9)
|
1,017
|
370
|
|||||
Deferred
remittance tax
|
109
|
42
|
|||||
Total
income and remittance taxes
|
1,126
|
412
|
|||||
Net
income
|
$
|
1,689
|
633
|
||||
See
accompanying notes to unaudited financial statements.
|
ARGOSY
ENERGY INTERNATIONAL, LP
|
||||||||||||
Balance
Sheets (Unaudited)
|
||||||||||||
March
31, 2006 and December 31, 2005
|
||||||||||||
(Expressed
in thousands of US dollars)
|
Assets
|
March
31,
2006
|
December
31,
2005
|
|||||
Current
assets:
|
|||||||
Cash
and cash equivalents (note 3)
|
$
|
2,670
|
7,124
|
||||
Accounts
receivable, net (note 4)
|
3,898
|
951
|
|||||
Accounts
receivable reimbursement Ecopetrol
|
1,186
|
1,186
|
|||||
Inventories:
|
|||||||
Crude
oil
|
211
|
218
|
|||||
Materials
and supplies
|
626
|
557
|
|||||
837
|
775
|
||||||
Total
current assets
|
8,591
|
10,036
|
|||||
Other
long-term assets
|
25
|
16
|
|||||
Property,
plant and equipment (note 5):
|
|||||||
Unproved
properties
|
3,831
|
3,622
|
|||||
Proved
properties
|
5,305
|
5,401
|
|||||
9,136
|
9,023
|
||||||
Total
assets
|
$
|
17,752
|
19,075
|
||||
Liabilities
and Partners' Equity
|
|||||||
Current
liabilities:
|
|||||||
Accounts
payable
|
4,852
|
4,979
|
|||||
Tax
payable
|
1,721
|
1,326
|
|||||
Employee
benefits
|
97
|
103
|
|||||
Accrued
liabilities
|
547
|
522
|
|||||
Total
current liabilities
|
7,217
|
6,930
|
|||||
Long-term
accounts payable (note 10)
|
686
|
686
|
|||||
Deferred
income tax
|
473
|
475
|
|||||
Deferred
remittance tax
|
1,210
|
1,104
|
|||||
Pension
plan
|
-
|
-
|
|||||
Total
liabilities
|
9,586
|
9,195
|
|||||
Partners'
equity (note 7)
|
8,166
|
9,880
|
|||||
Total
liabilities and partners' equity
|
$
|
17,752
|
19,075
|
See
accompanying notes to unaudited financial statements.
|
ARGOSY
ENERGY INTERNATIONAL, LP
|
||||||||||||
Statements
of Cash Flows (Unaudited)
|
||||||||||||
For
the Three Months Ended March 31, 2006 and 2005
|
||||||||||||
(Expressed
in thousands of US dollars)
|
2006
|
2005
|
||||||
Cash
flows from operating activities:
|
|||||||
Net
income
|
$
|
1,689
|
633
|
||||
Adjustments
to reconcile net income to net cash
|
|||||||
provided
by operating activities:
|
|||||||
Depreciation,
depletion and amortization
|
190
|
80
|
|||||
Deferred
remittance tax
|
109
|
42
|
|||||
Changes
in assets and liabilities:
|
|||||||
Accounts
receivable
|
(3,147
|
)
|
(839
|
)
|
|||
Inventories
|
(62
|
)
|
58
|
||||
Accounts
payable
|
(127
|
)
|
202
|
||||
Tax
payable
|
395
|
99
|
|||||
Employee
benefits
|
(6
|
)
|
48
|
||||
Accrued
Liabilities
|
25
|
491
|
|||||
Deferred
income tax
|
(2
|
)
|
1
|
||||
Deferred
remittance tax
|
(3
|
)
|
4
|
||||
Pensions
|
-
|
(5
|
)
|
||||
Net
cash (used in) provided by operating activities
|
(939
|
)
|
814
|
||||
Cash
flows from investing activities:
|
|||||||
Increase
in long term investments
|
(9
|
)
|
(1
|
)
|
|||
Payments
from Petroleum Equipment International - Talora
|
200
|
-
|
|||||
Additions
to property, plant and equipment
|
(303
|
)
|
(767
|
)
|
|||
Net
cash used in investing activities
|
(112
|
)
|
(768
|
)
|
|||
|
|||||||
Cash
flows from financial activities:
|
|||||||
Bank
overdrafts
|
-
|
106
|
|||||
Distributions
to partners
|
(3,250
|
)
|
-
|
||||
Aviva
redemption shares
|
(153
|
)
|
-
|
||||
Net
cash (used in) provided by financial activities
|
(3,403
|
)
|
106
|
||||
(Decrease)
increase in cash and cash equivalents
|
(4,454
|
)
|
152
|
||||
Cash
and cash equivalents at beginning of year
|
7,124
|
6,954
|
|||||
Cash
and cash equivalents at end of the period
|
$
|
2,670
|
7,106
|
See
accompanying notes to unaudited financial statements.
|
ARGOSY
ENERGY INTERNATIONAL, LP
|
|||||||
Statements
of Partners' Equity (Unaudited)
|
|||||||
For
the Three Months Ended March 31, 2006 and the Year Ended
December 31,
2005
|
|||||||
(Expressed
in thousands of US dollars)
|
|
Limited
|
General
|
Total
|
|||||||
partners'
|
partners'
|
partners'
|
||||||||
capital
|
capital
|
equity
|
||||||||
Balance
as of December 31, 2005
|
9,810
|
70
|
9,880
|
|||||||
Redemption
of partnership payments interest -
Aviva
Overseas Inc. (note 10)
|
(152
|
)
|
(1
|
)
|
(153
|
)
|
||||
Distributions
to partners
|
(3,227
|
)
|
(23
|
)
|
(3,250
|
)
|
||||
Net
income
|
1,677
|
12
|
1,689
|
|||||||
Balance
as of March 31, 2006
|
$
|
8,108
|
58
|
8,166
|
See
accompanying notes to unaudited financial statements.
|
Contract
|
Participation
|
Operator
|
Phase
|
|||||||
Santana
|
35
|
%
|
ARGOSY
|
Exploitation
|
||||||
Guayuyaco
|
70
|
%
|
ARGOSY
|
Exploitation
|
||||||
Aporte
Putumayo
|
100
|
%
|
ARGOSY
|
Abandonment
|
||||||
Río
Magdalena
|
70
|
%
|
ARGOSY
|
Exploration
|
||||||
Talora
|
20
|
%
|
ARGOSY
|
Exploration
|
||||||
Chaza
|
50
|
%
|
ARGOSY
|
Exploration
|
Phase
|
Starting
date
|
Obligations
|
|||||
3
|
December
16, 2006
|
One
exploratory well.
|
|||||
4
|
December
16, 2007
|
One
exploratory well.
|
|||||
5
|
December
16, 2008
|
One
exploratory well.
|
|||||
6
|
December
16, 2009
|
One
exploratory well.
|
Phase
|
Starting
date
|
Obligations
|
|||||
2
|
June
27, 2006
|
One
exploratory well.
|
|||||
3
|
June
27, 2007
|
One
exploratory well.
|
|||||
4
|
December
27, 2008
|
One
exploratory well.
|
|||||
5
|
December
27, 2009
|
One
exploratory well.
|
|
||||
6
|
December
27, 2010
|
One
exploratory well.
|
March
31,
2006
|
December
31,
2005
|
||||||
Held
in United States dollars
|
$
|
2,040
|
6,329
|
||||
Held
in Colombian pesos
|
157
|
394
|
|||||
Short-term
investments
|
473
|
401
|
|||||
$
|
2,670
|
7,124
|
March
31,
2006
|
December
31,
2005
|
||||||
Trade
|
$
|
3,248
|
675
|
||||
B.T.O.
Río Magdalena Agreement
|
355
|
355
|
|||||
Vendor
Advances
|
177
|
172
|
|||||
Petroleum
Equipment Investments - Talora
|
300
|
-
|
|||||
Other
|
173
|
104
|
|||||
4,253
|
1,306
|
||||||
Less
allowance for bad debts
|
(355
|
)
|
(355
|
)
|
|||
$
|
3,898
|
951
|
March
31,
2006
|
December
31,
2005
|
||||||
Oil
properties:
|
|||||||
Unproved
|
$
|
3,831
|
3,622
|
||||
Proved
|
59,190
|
59,096
|
|||||
|
|
|
63,021
|
|
|
62,718
|
|
Less
accumulated depreciation, depletion, and amortization
|
53,885
|
53,695
|
|||||
$
|
9,136
|
9,023
|
Capitalized
Cost Unproved
|
|||||||||||
Excluded
From the Capitalized Cost Being
Amortized
|
Month
Anticipated
|
||||||||||||||||||||||||||||
Exploration
Cost
|
Cost
Incurred
|
to
be included
|
||||||||||||||||||||||||||
AFE
|
Contract
|
Detail
|
Dec-04
|
Dec-05
|
Mar-06
|
2004
|
2005
|
2006
|
in
Amortization
|
|||||||||||||||||||
MARY
WELLWEST PROSPECT
|
Santana
|
Geological
& Geophysical Data
|
287
|
287
|
287
|
287
|
Dec-06
|
|||||||||||||||||||||
MARY
WEST WELL TESTING
|
Santana
|
Geological
& Geophysical Data
|
93
|
93
|
93
|
93
|
Dec-06
|
|||||||||||||||||||||
Expl.
100% NEW PROJECTS
|
New
Projects
|
Geological
& Geophysical Data
|
253
|
363
|
375
|
253
|
110
|
12
|
Dec-06
|
|||||||||||||||||||
Expl.
100% SANTANA
|
Guayuyaco
|
Geological
& Geophysical Data
|
1,044
|
1,044
|
1,044
|
1,044
|
Dec-06
|
|||||||||||||||||||||
Expl.
100% RIO MAGDALENA
|
Rio
Magdalena
|
Seismic
Program
|
634
|
808
|
889
|
634
|
174
|
81
|
Mar-07
|
|||||||||||||||||||
TALORA
PROJECT
|
Talora
|
Seismic
Program
|
1
|
89
|
134
|
1
|
88
|
44
|
Sep-07
|
|||||||||||||||||||
SEISMIC
GUAYUYACO
|
Guayuyaco
|
Seismic
Program
|
0
|
431
|
431
|
431
|
Dec-06
|
|||||||||||||||||||||
SEISMIC
CHAZA
|
Chaza
|
Seismic
Program
|
0
|
505
|
538
|
505
|
33
|
Sep-07
|
||||||||||||||||||||
POPA-1
WELL EXPLORATORY
|
Rio
Magdalena
|
Road
and Location Well
|
0
|
0
|
32
|
32
|
Mar-07
|
|||||||||||||||||||||
JUANAMBU-1
WELL EXPLORATORY
|
Guayuyaco
|
Road
and Location Well
|
0
|
2
|
8
|
2
|
6
|
Jun-07
|
||||||||||||||||||||
0
|
0
|
|||||||||||||||||||||||||||
Total
Unproved Exploration Costs
|
2,312
|
3,622
|
3,831
|
2,312
|
1,310
|
208
|
March
31,
2006 |
March
31,
2005 |
||||||
Interest
cost
|
$
|
8
|
8
|
||||
Expected
return of assets
|
(13
|
)
|
(6
|
)
|
|||
Amortization
of unrecognized net transition obligation (asset)
|
1
|
1
|
|||||
Net
periodic pension cost
|
$
|
(4
|
)
|
3
|
Stockholder
|
March
31,
2006
|
December
31,
2005
|
|||||
Crosby
Capital L.L.C.
|
$
|
98.75
|
98.75
|
||||
Argosy
Energy Corp. **
|
0.71
|
0.71
|
|||||
Dale
E. Armstrong
|
0.41
|
0.41
|
|||||
Richard
S. McKnight
|
0.13
|
0.13
|
|||||
$
|
100.0
|
100.00
|
March
31,
2006 |
March
31,
2005 |
||||||
Direct
labor
|
$
|
111
|
86
|
||||
Maintenance,
materials and lubricants
|
86
|
49
|
|||||
Repairs
- third party
|
123
|
196
|
|||||
General
expenses - other
|
47
|
33
|
|||||
$
|
367
|
364
|
|
March
31, 2006
|
March
31, 2005
|
|||||||||||
Amount
|
%
|
Amount
|
%
|
||||||||||
Income
before taxes
|
$
|
2,815
|
100.00
|
1,045
|
100.00
|
||||||||
Computed
“Expected” tax expense
|
985
|
35.00
|
366
|
35.00
|
|||||||||
Tax
expense
|
1,126
|
40.00
|
412
|
39.43
|
|||||||||
Difference
|
$
|
141
|
5.00
|
46
|
4.43
|
|
March
31, 2006
|
March
31, 2005
|
|||||||||||||||||
Basis
|
Amount
|
%
|
Basis
|
Amount
|
%
|
||||||||||||||
Explanation:
|
|||||||||||||||||||
Difference
in principles and translation
|
$
|
(312
|
)
|
(109
|
)
|
(3.88
|
)
|
(86
|
)
|
(30
|
)
|
(2.87
|
)
|
||||||
Surcharge
tax (10%)
|
92
|
3.28
|
34
|
3.25
|
|||||||||||||||
Remitance
tax expense (7%)
|
146
|
5.19
|
42
|
4.02
|
|||||||||||||||
Inflation
adjustment
|
(23
|
)
|
(8
|
)
|
(0.28
|
)
|
-
|
-
|
|||||||||||
No
deductible expenses
|
9
|
3
|
0.11
|
-
|
-
|
||||||||||||||
No
deductible taxes (Industry
and
commerce, stamp tax )
|
41
|
14
|
0.51
|
-
|
-
|
||||||||||||||
Assessments
to financial movements
|
6
|
2
|
0.07
|
-
|
-
|
||||||||||||||
Income
not taxable
|
4
|
1
|
0.00
|
-
|
|||||||||||||||
$
|
|
141
|
5.00
|
46
|
4.43
|
March
31,
2006
|
December
31,
2005
|
||||||
Accrued
liabilities
|
$
|
201
|
201
|
||||
Property,
plant and equipment
|
(674
|
)
|
(676
|
)
|
|||
Net
deferred tax liability
|
$
|
(473
|
)
|
(475
|
)
|
||
Roll
forward of deferred taxes:
|
|||||||
Beginning
balance
|
475
|
223
|
|||||
Increase
in year
|
-
|
352
|
|||||
Translation
|
(2
|
)
|
(100
|
)
|
|||
$
|
473
|
475
|
1) |
An
equity tax was created for fiscal years 2004, 2005 and
2006. Such tax must
be liquidated applying at 0.3 % over the net equity at
January
1st
of
each year. This applies to equities of 3.000 million
pesos in 2004, 3.183
million pesos in 2005 and 3.344 million pesos in 2006.
|
2) |
The
financial transaction tax increased from 3 per thousand
to 4 per thousand
and it is applicable through the year
2007.
|
3) |
Paid
taxes are not deductible except for 80% of industrial
and commercial and
Property Taxes.
|
4) |
The
10% income tax surcharge (3.5%) is applicable for years
2003 through 2006.
This payment is not deductible for tax
purposes.
|
1. |
The
parties agreed that the agreement is a negotiated resolution
of various
disputes between the parties.
|
2. |
Aviva
Overseas, Inc. assigned and transferred all interests
in the partnership,
corresponding to 29.6196%, to Argosy Energy International,
LP as a
redemption of such interests.
|
3. |
Argosy
Energy International, LP is required to make the following
payments to
Aviva Overseas, Inc.: an initial cash payment of $300
as reimbursement to
Aviva Overseas, Inc. for a portion of its cost incurred
in connection with
the disputes, a 90 day promissory note amounted to $3,050,
a two year
promissory note in the amount of $1,125 (the “Note”, represented for 8
quarterly payments of $153 beginning in November 2005,
including interest
at 8%), and an additional payment (described below) accrued
in the amount
of $329 as of the agreement date. As of March 31, 2006,
amounts
outstanding under the agreement include $990 due on the
Note and $310
accrued for the additional payment. The outstanding amount
is payable as
follows: $614 in 2006 and $686 in
2007.
|
Partner
|
Interest
|
Type
of interest
|
|||||
Crosby
Capital L.L.C.
|
98.7491
|
%
|
Limited
Partner
|
||||
Argosy
Energy Corporation
|
0.7104
|
%
|
General
Partner
|
||||
Dale
E. Armstrong
|
0.4122
|
%
|
Limited
Partner
|
||||
Richard
S. McKnight
|
0.1283
|
%
|
Limited
Partner
|
||||
Total
|
100.0000
|
%
|
• |
The
Company signed in May and June, 2006 two new exploration
and production
contracts with the National Hydrocarbons Agency (ANH)
called Primavera and
Mecaya, to explore and produce oil, respectively.
|
• |
On
April 1, 2006 the partners of the partnership entered
into a redemption
agreement pursuant to which all of Dale E. Armstrong
interest and Richard
S. McKnight interest.
|
• |
On
June 21, 2006 Gran Tierra Energy Inc. acquired all of
the outstanding
partnership interest in the Company.
|
2005
|
2004
|
||||||
Oil
sales to Ecopetrol
|
$
|
11,891
|
6,393
|
||||
Operating
cost (note 9)
|
2,452
|
2,060
|
|||||
Depreciation,
depletion and amortization
|
697
|
357
|
|||||
General
and administrative expenses
|
1,082
|
859
|
|||||
4,231
|
3,276
|
||||||
Operating
profit
|
7,660
|
3,117
|
|||||
Other
income, net (note 10)
|
449
|
225
|
|||||
Income
before income and remittance taxes
|
8,109
|
3,342
|
|||||
Current
income tax (note 11)
|
2,187
|
1,026
|
|||||
Deferred
income tax
|
352
|
245
|
|||||
Deferred
remittance tax
|
353
|
146
|
|||||
Total
income and remittance taxes
|
2,892
|
1,417
|
|||||
Net
Income
|
$
|
5,217
|
1,925
|
Assets
|
2005
|
2004
|
|||||
Current
assets:
|
|||||||
Cash
and cash equivalents (note 3)
|
$
|
7,124
|
6,954
|
||||
Accounts
receivable, net (note 4)
|
951
|
584
|
|||||
Accounts
receivable reimbursement Ecopetrol
|
1,186
|
-
|
|||||
Inventories:
|
|||||||
Crude
oil
|
218
|
154
|
|||||
Materials
|
557
|
248
|
|||||
|
775
|
402
|
|||||
Total
current assets
|
10,036
|
7,940
|
|||||
|
|||||||
Other
long-term assets
|
16
|
10
|
|||||
Property,
plant and equipment (note 5):
|
|||||||
Unproved
properties
|
3,622
|
2,312
|
|||||
Proved
properties, net
|
5,401
|
3,211
|
|||||
|
9,023
|
5,523
|
|||||
Total
assets
|
$
|
19,075
|
13,473
|
||||
|
|||||||
|
|||||||
Liabilities
and Partners' Equity
|
|||||||
|
|||||||
Current
liabilities:
|
|||||||
Accounts
payable
|
4,979
|
1,745
|
|||||
Tax
payable
|
1,326
|
826
|
|||||
Employee
benefits
|
103
|
88
|
|||||
Accrued
liabilities
|
522
|
375
|
|||||
Total
current liabilities
|
6,930
|
3,034
|
|||||
Long-term
accounts payable (note 6)
|
686
|
-
|
|||||
Deferred
income tax
|
475
|
223
|
|||||
Deferred
remmittance tax
|
1,104
|
714
|
|||||
Pension
plan (note 7)
|
-
|
35
|
|||||
Total
liabilities
|
9,195
|
4,006
|
|||||
Partners'
equity (note 8)
|
9,880
|
9,467
|
|||||
Total
liabilities and Partners' equity
|
$
|
19,075
|
13,473
|
2005
|
2004
|
||||||
Cash
flows from operating activities:
|
|||||||
Net
income
|
$
|
5,217
|
1,925
|
||||
Adjustments
to reconcile net income to net cash
|
|||||||
provided
by operating activities:
|
|||||||
Depreciation,
depletion and amortization
|
697
|
357
|
|||||
Bad
debt allowance
|
116
|
239
|
|||||
Deferred
income tax
|
352
|
245
|
|||||
Deferred
remittance tax
|
353
|
146
|
|||||
Pensions
|
24
|
59
|
|||||
Changes
in assets and liabilities:
|
|||||||
Accounts
receivable
|
(1,669
|
)
|
(191
|
)
|
|||
Inventories
|
(373
|
)
|
339
|
||||
Accounts
payable
|
2,620
|
1,245
|
|||||
Tax
payable
|
500
|
|
716
|
|
|||
Employee
benefits
|
15
|
28
|
|||||
Accrued
liabilities
|
147
|
102
|
|||||
Deferred
income tax
|
(100
|
)
|
(4
|
)
|
|||
Deferred
remmittance tax
|
37
|
58
|
|||||
Net
cash provided by operating activities
|
7,936
|
5,264
|
|||||
Cash
flows from investing activities:
|
|||||||
Increase
in long term investments
|
(65
|
)
|
(70
|
)
|
|||
Additions
to property, plant and equipment
|
(4,197
|
)
|
(748
|
)
|
|||
Net
cash used in investing activities
|
(4,262
|
)
|
(818
|
)
|
|||
|
|||||||
Cash
flows used in financial activities - Redemption of partnership
|
|||||||
interest
- Aviva Overseas Inc.
|
(3,504
|
)
|
-
|
||||
Net
increase in cash and cash equivalents
|
170
|
4,446
|
|||||
Cash
and cash equivalents at beginning of year
|
6,954
|
2,508
|
|||||
Cash
and cash equivalents at end of year
|
$
|
7,124
|
6,954
|
|
Limited
|
General
|
Total
|
|||||||
|
partners'
|
partners'
|
partners'
|
|||||||
|
capital
|
capital
|
equity
|
|||||||
|
||||||||||
Balance
as of December 31, 2003
|
$
|
7,504
|
38
|
7,542
|
||||||
Net
income
|
1,915
|
10
|
1,925
|
|||||||
Balance
as of December 31, 2004
|
9,419
|
48
|
9,467
|
|||||||
Net
income
|
5,180
|
37
|
5,217
|
|||||||
Redemption
of partnership interest -
|
||||||||||
Aviva
Overseas Inc. (note 6)
|
(4,789
|
)
|
(15
|
)
|
(4,804
|
)
|
||||
Balance
as of December 31, 2005
|
$
|
9,810
|
70
|
9,880
|
ARGOSY
ENERGY INTERNATIONAL, LP
|
||||
|
||||
Notes
to Financial Statements
|
||||
|
||||
December
31, 2005 and 2004
|
||||
|
||||
(Expressed
in thousands of US dollars)
|
Contract
|
Participation
|
Operator
|
Phase
|
|||||||
Santana
|
35
|
%
|
ARGOSY
|
Exploitation
|
||||||
Guayuyaco
|
70
|
%
|
ARGOSY
|
Exploitation
|
||||||
Aporte
Putumayo
|
100
|
%
|
ARGOSY
|
Abandonment
|
||||||
Río
Magdalena
|
70
|
%
|
ARGOSY
|
Exploration
|
||||||
Talora
|
20
|
%
|
ARGOSY
|
Exploration
|
||||||
Chaza
|
50
|
%
|
ARGOSY
|
Exploration
|
Phase | Starting date | Obligations |
|
||
3 | December 16, 2006 | One exploratory well. |
4 | December 16, 2007 | One exploratory well. |
5 | December 16, 2008 | One exploratory well. |
6 | December 16, 2009 | One exploratory well. |
Phase | Starting date | Obligations |
|
||
2 | June 27, 2006 | One exploratory well. |
3 | June 27, 2007 | One exploratory well. |
4 | December 16, 2008 | One exploratory well. |
5 | December 16, 2009 | One exploratory well. |
6 | December 16, 2010 | One exploratory well. |
2005
|
2004
|
||||||
Held
in United States dollars
|
$
|
6,329
|
6,454
|
||||
Held
in Colombian pesos
|
394
|
185
|
|||||
Short-term
investments
|
401
|
315
|
|||||
$
|
7,124
|
6,954
|
2005
|
2004
|
||||||
Trade
|
$
|
675
|
81
|
||||
B.T.
Río Magdalena Agreement
|
355
|
239
|
|||||
Vendor
advances
|
172
|
60
|
|||||
Solana
joint account
|
-
|
324
|
|||||
Other
|
104
|
119
|
|||||
1,306
|
823
|
||||||
Less
allowance for bad debts
|
(355
|
)
|
(239
|
)
|
|||
$
|
951
|
584
|
2005
|
2004
|
||||||
Oil
properties:
|
|||||||
Unproved
|
$
|
3,622
|
2,312
|
||||
Proved
|
59,096
|
56,218
|
|||||
62,718
|
58,530
|
||||||
Less
accumulated depreciation, depletion,
|
|||||||
and
amortization
|
53,695
|
53,007
|
|||||
$
|
9,023
|
5,523
|
Capitalized
Cost Unproved
|
|||||||||
Excluded
From the Capitalized Cost Being
Amortized
|
Month
Anticipated
|
||||||||||||||||||||||
Exploration
Cost
|
Cost
Incurred
|
to
be included
|
||||||||||||||||||||
AFE
|
Contract
|
Detail
|
Dec-04
|
Dec-05
|
2004
|
2005
|
in
Amortization
|
|||||||||||||||
MARY
WELLWEST PROSPECT
|
Santana
|
Geological
& Geophysical Data
|
287
|
287
|
287
|
Dec-06
|
||||||||||||||||
MARY
WEST WELL TESTING
|
Santana
|
Geological
& Geophysical Data
|
93
|
93
|
93
|
Dec-06
|
||||||||||||||||
EXPL.
100% NEW PROJECTS
|
New
Projects
|
Geological
& Geophysical Data
|
253
|
363
|
253
|
110
|
Dec-06
|
|||||||||||||||
EXPL.
100% SANTANA
|
Guayuyaco
|
Geological
& Geophysical Data
|
1,044
|
1,044
|
1,044
|
Dec-06
|
||||||||||||||||
EXPL.
100% RIO MAGDALENA
|
Rio
Magdalena
|
Sesimic
Program
|
634
|
808
|
634
|
174
|
Mar-07
|
|||||||||||||||
TALORA
PROJECT
|
Talora
|
Seismic
Program
|
1
|
89
|
1
|
88
|
Sep-07
|
|||||||||||||||
SEISMIC
GUAYUYACO
|
Guayuyaco
|
Seismic
Program
|
0
|
431
|
431
|
Dec-06
|
||||||||||||||||
SEISMIC
CHAZA
|
Chaza
|
Seismic
Program
|
0
|
505
|
505
|
Sep-07
|
||||||||||||||||
POPA-1
WELL EXPLORATORY
|
Rio
Magdalena
|
Road
and Location Well
|
0
|
0
|
Mar-07
|
|||||||||||||||||
JUANAMBU-1
WELL EXPLORATORY
|
Guayuyaco
|
Road
and Location Well
|
0
|
2
|
2
|
Jun-07
|
||||||||||||||||
0
|
||||||||||||||||||||||
Total
Unproved Exploration Costs
|
2,312
|
3,622
|
2,312
|
1,310
|
Partner
|
Interest
|
Type
of interest
|
|||||
Crosby
Capital L.L.C.
|
98.7491
|
%
|
Limited
Partner
|
||||
Argosy
Energy Corporation
|
0.7104
|
%
|
General
Partner
|
||||
Dale
E. Armstrong
|
0.4122
|
%
|
Limited
Partner
|
||||
Richard
S. McKnight
|
0.1283
|
%
|
Limited
Partner
|
||||
Total
|
100.0000
|
%
|
2005
|
2004
|
||||||
Interest
cost
|
$
|
34
|
31
|
||||
Expected
return of assets
|
(48
|
)
|
(30
|
)
|
|||
Amortization
of unrecognized net transition obligation
(asset)
|
3
|
3
|
|||||
Net
periodic pension cost
|
$
|
(11
|
)
|
4
|
|||
Changes
in plan assets:
|
|||||||
Fund
assets at beginning of year
|
300
|
232
|
|||||
Interest
earned
|
61
|
68
|
|||||
Fund
assets at end of year
|
$
|
361
|
300
|
2005
|
2004
|
||||||
Funded
status:
|
|||||||
Projected
benefit obligation
|
359
|
335
|
|||||
Assets
at fair value
|
361
|
300
|
|||||
Funded
status
|
2
|
(35
|
)
|
||||
Unrecognized
net transaction obligation remaining
|
31
|
32
|
|||||
Unrecognized
prior service cost
|
-
|
-
|
|||||
Adjustment
additional minimum liability
|
(2
|
)
|
(5
|
)
|
|||
Unrecognized
net loss or (gain)
|
(29
|
)
|
(27
|
)
|
|||
Prepaid
(unfunded accrued) pension cost
|
$
|
2
|
(35
|
)
|
2005
|
2004
|
||||||
Change
in benefit obligation
|
|||||||
Benefit
obligation at beginning of year
|
335
|
276
|
|||||
Interest
Cost
|
34
|
31 | |||||
Benefits
Paid
|
(24
|
) | (22 | ) | |||
Foreign
Currency Exchange
|
14
|
50
|
|||||
Total
Activity
|
24
|
59
|
|||||
Benefit
obligation at end of year
|
359
|
335
|
2005
%
|
2004
%
|
||||||
|
|||||||
Discount
rate
|
9.3
|
10.5
|
|||||
Rate
of compensation increase
|
4.7
|
6.0
|
Year
|
Amount
|
|||
2006
|
25
|
|||
2007
|
23
|
|||
2008
|
22
|
|||
2009
|
20
|
|||
2010
|
19
|
|||
2011-
2016
|
250
|
Stockholders
|
2005
%
|
2004
%
|
|||||
|
|||||||
Crosby
Capital L.L.C.
|
98.75
|
69.50
|
|||||
Argosy
Energy Corp. .**
|
0.71
|
0.50
|
|||||
Aviva
Overseas, Inc
|
-
|
29.62
|
|||||
Dale
E. Armstrong
|
0.41
|
0.29
|
|||||
Richard
S. McKnight
|
0.13
|
0.09
|
|||||
100.00
|
100.00
|
2005
|
2004
|
||||||
Direct
labor
|
$
|
383
|
316
|
||||
Maintenance,
materials and lubricants
|
417
|
417
|
|||||
Repairs
- third party
|
700
|
752
|
|||||
General
expenses - others
|
952
|
575
|
|||||
$
|
2,452
|
2,060
|
2005
|
2004
|
||||||
Oil
transportation
|
$
|
18
|
146
|
||||
Financial
income
|
171
|
65
|
|||||
Insurance
reimbursement
|
126
|
-
|
|||||
Other
income
|
217
|
162
|
|||||
Foreign
translation gain (loss)
|
33
|
(148
|
)
|
||||
Allowance
for bad debts
|
(116
|
)
|
-
|
||||
$
|
449
|
225
|
2005
|
2004
|
||||||||||||
|
Basis
Amount %
|
|
Basis
Amount %
|
||||||||||
Income
before taxes
|
$
|
8,109
|
100.00
|
3,342
|
100.00
|
||||||||
Computed
“Expected” tax expense
|
2,838
|
35.00
|
1,170
|
35.00
|
|||||||||
Tax
expense
|
2,892
|
35.66
|
1,417
|
42.40
|
|||||||||
Difference
|
$
|
54
|
0.66
|
247
|
7.40
|
2005
|
2004
|
||||||||||||||||||
Basis
|
|
Amount
|
%
|
Basis
|
Amount
|
%
|
|||||||||||||
Explanation:
|
|||||||||||||||||||
Difference
in principles
|
$
|
(593
|
)
|
(207
|
)
|
(2.56
|
)
|
(49
|
)
|
(17
|
)
|
(0.51
|
)
|
||||||
Surcharge
tax (10%)
|
199
|
2.45
|
93
|
2.79
|
|||||||||||||||
Remittance
tax expense (7%)
|
353
|
4.35
|
146
|
4.37
|
|||||||||||||||
Inflation
adjustment
|
(53
|
)
|
(19
|
)
|
(0.23
|
)
|
(21
|
)
|
(7
|
)
|
(0.22
|
)
|
|||||||
No
deductible expense
|
32
|
11
|
0.14
|
16
|
6
|
0.17
|
|||||||||||||
No
deductible tax (Stamp tax)
|
130
|
46
|
0.56
|
57
|
20
|
0.60
|
|||||||||||||
Assessments
to financial
|
|||||||||||||||||||
movements
|
45
|
16
|
0.19
|
13
|
4
|
0.13
|
|||||||||||||
Equity
tax
|
25
|
9
|
0.11
|
31
|
11
|
0.33
|
|||||||||||||
Deduction
fixed real productive
|
|||||||||||||||||||
assets
|
(1,014
|
)
|
(355
|
)
|
(4.38
|
)
|
|||||||||||||
Income
not taxable
|
4
|
1
|
0.03
|
(23
|
)
|
(9
|
)
|
(0.26
|
)
|
||||||||||
$
|
|
54
|
0.66
|
247
|
7.40
|
The
deferred tax is the following:
|
2005
|
2004
|
||||||
Accrued
liabilities
|
$
|
201
|
183
|
||||
Property,
plant and equipment
|
(676
|
)
|
(406
|
)
|
|||
Net
deferred tax liability
|
$
|
(475
|
)
|
(223
|
)
|
||
Roll
forward of deferred taxes:
|
|||||||
Net
deferred tax to December 31:
|
|||||||
Beginning
balance
|
223
|
(18
|
)
|
||||
Increase
in year
|
352
|
245
|
|||||
Translation
|
(100
|
)
|
(4
|
)
|
|||
$
|
475
|
223
|
1) |
An
equity tax was created for fiscal years 2004, 2005
and 2006. Such tax must
be liquidated applying at 0.3 % over the net equity
at January
1st
of
each year. This applies to equities of 3.000 millions
pesos in 2004, 3.183
millions pesos in 2005 and 3.344 millions pesos in
2006.
|
2) |
The
financial transaction tax increased from 3 per thousand
to 4 per thousand
and it is applicable through the year
2007.
|
3) |
Paid
taxes are not deductible except for 80% of industrial
and commercial and
property Taxes.
|
4) |
The
10% income tax surcharge (3.5%) is applicable for years
2003 through 2006.
This payment is not deductible for tax
purposes.
|
• |
The
Company signed in May and June, 2006 two new exploration
and production
contracts with the National Hydrocarbons Agency (ANH)
called Primavera and
Mecaya, to explore and produce oil, respectively.
|
• |
On
April 1, 2006 the partners of the partnership entered
into a redemption
agreement pursuant to which all of Dale E. Armstrong
interest and Richard
S. McKnight interest.
|
• |
On
June 21, 2006 Gran Tierra Energy Inc. acquired all
of the outstanding
partnership interest in the Company.
|
I-Oil
Reserves Information
|
|||||||
(In
barrels)
|
|||||||
Proved
Developed and Undeveloped Reserves
|
|||||||
Balance
at December 31, 2003
|
1,845,654
|
||||||
Revision
of previous estimates
|
168,766
|
||||||
Improved
recovery
|
-
|
||||||
Purchases
of proved reserves
|
-
|
||||||
Extension
and discoveries
|
-
|
||||||
Production
|
(197,027
|
)
|
|||||
Sales
|
-
|
||||||
Balance
at December 31, 2004
|
1,817,393
|
||||||
Revision
of previous estimates
|
(18,936
|
)
|
|||||
Improved
recovery
|
-
|
||||||
Purchases
of proved reserves
|
-
|
||||||
Extension
and discoveries
|
822,007
|
||||||
Production
|
(283,795
|
)
|
|||||
Sales
|
-
|
||||||
Balance
at December 31, 2005
|
2,336,669
|
||||||
Proved
developed reserves
|
|||||||
December
31, 2004
|
1,817,393
|
||||||
December
31, 2005
|
2,336,669
|
II-
Capitalized
Costs Relating to Oil And Gas Producing
Activities
|
|||||
(In
thousands)
|
As
of December 31,
|
|||||||
2005
|
2004
|
||||||
Oil
& gas properties:
|
|||||||
Unproved
|
$
|
3,622
|
2,312
|
||||
Proved
|
59,096
|
56,218
|
|||||
Accumulated
depreciation, depletion and amortization
|
(53,695
|
)
|
(53,007
|
)
|
|||
Net
capitalized costs
|
$
|
9,023
|
5,523
|
||||
III-
Cost Incurred in Oil And Gas Property Acquisition,
|
|||||
Exploration
and Development Activities
|
|||||
(In
thousands)
|
For
the year ended
December
31,
|
|||||||
2005
|
2004
|
||||||
Property
acquisitions costs
|
$
|
-
|
-
|
||||
Exploration
costs
|
1,310
|
405
|
|||||
Development
costs
|
2,878
|
45
|
|||||
Costs
incurred
|
$
|
4,188
|
450
|
IV- Results
of operations for producing
activities
|
|||||||
(In
thousands)
|
|||||||
For
the year ended
December
31,
|
|||||||
2005
|
2004
|
||||||
Revenues
- Oil sales
|
$
|
11,891
|
6,393
|
||||
Production
costs
|
(2,452
|
)
|
(2,060
|
)
|
|||
Depreciation,
depletion and amortization
|
(697
|
)
|
(357
|
)
|
|||
Income
tax expenses
|
(2,892
|
)
|
(1,417
|
)
|
|||
Results
of operations
|
$
|
5,850
|
2,559
|
V- Standardized
Measure of Discounted Future Net Cash Flows
|
|||||
(In
thousands)
|
|||||
As
of December 31,
|
|||||||
2005
|
2004
|
||||||
Future
cash inflows
|
$
|
112,721
|
64,626
|
||||
Future
production and development costs
|
(26,756
|
)
|
(21,553
|
)
|
|||
Future
income tax expense
|
(31,844
|
)
|
(15,952
|
)
|
|||
Future
net cash flows
|
54,121
|
27,121
|
|||||
10%
Annual discount factor
|
(15,688
|
)
|
(8,188
|
)
|
|||
Standardized
measure
|
$
|
38,433
|
18,933
|
Changes
in the Standardized Measure of Discounted Future
|
||||
Net
Cash Flows From Proved Reserve Quantities During
2005
|
||||
Balance
as of December 31, 2004
|
$
|
18,933
|
||
Sales
and transfers of oil and gas produced, net of production
costs
|
(9,439
|
)
|
||
Net
changes in prices and production costs
|
20,115
|
|||
Extensions,
discoveries and improved recover, net of related
costs
|
25,626
|
|||
Development
costs incurred during the period
|
0
|
|
||
Revision
of previous quantity estimates
|
(702
|
)
|
||
Accretion
of discount
|
1,175
|
|
||
Net
change in income taxes
|
(15,892
|
)
|
||
Other
|
(1,383
|
)
|
||
Balance
as of December 31, 2005
|
$
|
38,433
|
Eight-month
period ended
|
||||
August
31, 2005
|
||||
Revenues
|
2,913,532
|
|||
Royalties
|
(353,228
|
)
|
||
Operating
costs
|
(1,081,085
|
)
|
||
1,479,219
|
Revenues
from the sale of product are recognized upon delivery to
purchasers.
|
A
12% royalty is payable on the estimated value at the wellhead
of crude oil
production and the natural gas volumes commercialized.
The estimated value
is calculated based upon the actual sale price of the crude
oil and gas
produced, less the costs of transportation and storage.
|
In
preparing the Schedule of Revenues, Royalties and Operating
Cost, the
results have been translated from Argentine pesos to U.S.
dollars using
the average exchange rate for the eight-month period ended
August 31,
2005. The average exchange rates from Argentine pesos to
U.S. dollars was
Argentine peso 2.9015 to U.S. dollar for the eight-month
period ended
August 31, 2005.
|
RESERVES
QUANTITY INFORMATION
|
||||
FOR
THE PERIOD ENDED AUGUST 31, 2005
|
||||
Proved
developed and undeveloped reserves:
|
||||
Beginning
of year, January 1, 2005
|
733,857
|
|||
Revisions
of previous estimates
|
(37,381
|
)
|
||
Production
|
(80,091
|
)
|
||
|
|
|||
End
of year, August 31, 2005*
|
616,385
|
|||
Proved
Developed Reserves:
|
||||
Beginning
of year, January 1, 2005
|
577,321
|
|||
End
of year, August 31, 2005*
|
497,585
|
|||
*Denotes
the date at which Gran Tierra Energy purchased the assets
of Palmar
Largo.
|
Palmar
Largo
|
||||
Future
Cash Inflows*
|
27,000,420
|
|||
Future
Production and Development Costs*
|
(14,226,418
|
)
|
||
Future
Income Tax Expense*
|
(1,080,530
|
)
|
||
Future
Net Cash Flows
|
11,693,472
|
|||
10%
annual discount for estimated timing of cash flows
|
(3,476,304
|
)
|
||
Standardized
Measure of discounted future net cash flows
|
8,217,168
|
Sales
and transfers of oil and gas produced, net of production
costs
|
(1,848,790
|
)
|
||
Net
changes in prices, volumes and production costs
|
2,590,816
|
|||
Extentions,
discoveries and improved recovery, less related costs
|
656,101
|
|||
Accretion
of Discount
|
902,368
|
|||
Net
change in income taxes
|
(1,429,504
|
)
|
||
Total
Explained Variance
|
870,991
|
|||
(Amounts
expressed in U.S. Dollars - Note
2)
|
Six-month
period ended
|
Year
ended
|
||||||||||||
June
30, 2005
|
June
30, 2004
|
2004
|
2003
|
||||||||||
(unaudited)
|
(unaudited)
|
(audited)
|
(audited)
|
||||||||||
Revenues
|
2,065,587
|
2,036,454
|
4,703,136
|
4,422,688
|
|||||||||
Royalties
|
(258,716
|
)
|
(239,111
|
)
|
(492,535
|
)
|
(457,293
|
)
|
|||||
Operating
costs
|
(837,524
|
)
|
(635,088
|
)
|
(1,424,152
|
)
|
(1,297,260
|
)
|
|||||
969,347
|
1,162,255
|
2,786,449
|
2,668,135
|
RESERVES
QUANTITY INFORMATION
|
||||
FOR
THE PERIOD ENDED DECEMBER 31, 2004
|
||||
Proved
developed and undeveloped reserves:
|
||||
Beginning
of year, January 1, 2004
|
868,477
|
|||
Revisions
of previous estimates
|
||||
Production
|
(134,620
|
)
|
||
|
|
|||
End
of year, December 31, 2004
|
733,857
|
|||
Proved
Developed Reserves:
|
||||
Beginning
of year, January 1, 2004
|
711,941
|
|||
End
of year, December 31, 2004
|
577,321
|
Palmar
Largo
|
||||
Future
Cash Inflows*
|
22,909,244
|
|||
Future
Production and Development Costs*
|
(13,469,358
|
)
|
||
Future
Income Tax Expense*
|
348,974
|
|||
Future
Net Cash Flows
|
9,788,860
|
|||
10%
annual discount for estimated timing of cash flows
|
(2,442,683
|
)
|
||
Standardized
Measure of discounted future net cash flows
|
7,346,177
|
Sales
and transfers of oil and gas produced, net of production
costs
|
(369,103
|
)
|
||
Net
changes in prices, volumes and production costs
|
(191,468
|
)
|
||
Extentions,
discoveries and improved recovery, less related costs
|
1,590,000
|
|||
Accretion
of Discount
|
717,305
|
|||
Net
change in income taxes
|
(798,956
|
)
|
||
Other
|
(23,518
|
)
|
||
Total
Explained Variance
|
924,259
|
Proved
developed and undeveloped reserves:
|
||||
Beginning
of year, January 1, 2003
|
1,017,857
|
|||
Revisions
of previous estimates
|
||||
Production
|
(149,380
|
)
|
||
|
||||
End
of year, December 31, 2003
|
868,477
|
|||
Proved
Developed Reserves:
|
||||
Beginning
of year, January 1, 2003
|
861,321
|
|||
End
of year, December 31, 2003
|
711,941
|
Palmar
Largo
|
||||
Future
Cash Inflows*
|
24,990,646
|
|||
Future
Production and Development Costs*
|
(16,949,292
|
)
|
||
Future
Income Tax Expense*
|
1,147,930
|
|||
Future
Net Cash Flows
|
9,189,284
|
|||
10%
annual discount for estimated timing of cash flows
|
(2,767,366
|
)
|
||
Standardized
Measure of discounted future net cash flows
|
6,421,918
|
§ |
a
willful failure to deal fairly with the company or its stockholders
in
connection with a matter in which the director has a material
conflict of
interest;
|
§ |
a
violation of criminal law (unless the director had reasonable
cause to
believe that his or her conduct was lawful or no reasonable
cause to
believe that his or her conduct was
unlawful);
|
§ |
a
transaction from which the director derived an improper personal
profit;
and
|
§ |
willful
misconduct.
|
EXPENSE
|
AMOUNT
|
|
Registration
Fees
|
$9,755.36
|
|
Legal
Fees*
|
60,000
|
|
Accounting
Fees*
|
30,000
|
|
Miscellaneous
Fees and Expenses*
|
10,244.64
|
|
Total
|
$110,000
|
Exhibit
No.
|
Description
|
Reference
|
3.1
|
Articles
of Incorporation.
|
Incorporated
by reference to Exhibit 3.1 to the Form SB-2, as amended,
filed with the
Securities and Exchange Commission on December 31, 2003 (File No.
333-111656).
|
||
3.2
|
Certificate
Amending Articles of Incorporation.
|
Incorporated
by reference to Exhibit 3.2 to the Form SB-2, as amended,
and filed with
the Securities and Exchange Commission on December 31, 2003 (File No.
333-111656).
|
||
3.3
|
Bylaws.
|
Incorporated
by reference to Exhibit 3.3 to the Form SB-2, as amended,
filed with the
Securities and Exchange Commission on December 31, 2003 (File No.
333-111656).
|
||
3.4
|
Certificate
Amending Articles of Incorporation.
|
Incorporated
by reference to Exhibit 3.4 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
3.5
|
Certificates
of Amendment to Articles of Incorporation.
|
Incorporated by reference to Exhibit 3.5 to the Current Report on Form 8-K filed with the Securities and Exchange Commission on June 1, 2006 (File No. 333-111656). | ||
3.6
|
Amended
and Restated Bylaws of Gran Tierra Energy Inc.
|
Incorporated
by reference to Exhibit 3.5 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on June 21, 2006 (File
No.
333-111656).
|
||
4.1
|
Form
of Warrant.
|
Incorporated
by reference to Exhibit 4.1 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on December 19, 2005
(File No.
333-111656).
|
5.1
|
Opinion
of McGuireWoods LLP.*
|
10.1
|
Share
Purchase Agreement by and between Goldstrike Inc. and Gran
Tierra Energy
Inc. dated as of November 10, 2005.
|
Incorporated
by reference to Exhibit 10.1 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.2
|
Form
of Registration Rights Agreement by and among Goldstrike Inc.
and the
purchasers named therein.
|
Incorporated
by reference to Exhibit 10.2 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on December 19, 2005
(File No.
333-111656).
|
Exhibit
No.
|
Description
|
Reference
|
10.3
|
Assignment
Agreement by and between Goldstrike Inc. and Gran Tierra Goldstrike
Inc.
dated as of November 10, 2005.
|
Incorporated
by reference to Exhibit 10.2 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.4
|
Voting
Exchange and Support Agreement by and between Goldstrike, Inc.,
1203647
Alberta Inc., Gran Tierra Goldstrike Inc. and Olympia Trust
Company dated
as of November 10, 2005.
|
Incorporated
by reference to Exhibit 10.3 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.5
|
Form
of Split Off Agreement by and among Goldstrike Inc., Dr. Yenyou
Zheng,
Goldstrike Leasco Inc. and Gran Tierra Energy Inc.
|
Incorporated
by reference to Exhibit 10.4 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.6
|
Employment
Agreement between Gran Tierra Energy Inc. and Dana Coffield
dated as of
April 29, 2005, as amended.
|
Incorporated
by reference to Exhibit 10.5 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.7
|
Employment
Agreement between Gran Tierra Energy Inc. and James Hart dated
as of April
29, 2005, as amended.
|
Incorporated
by reference to Exhibit 10.6 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.8
|
Employment
Agreement between Gran Tierra Energy Inc. and Max Wei dated
as of April
29, 2005, as amended.
|
Incorporated
by reference to Exhibit 10.7 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
Exhibit
No.
|
Description
|
Reference
|
10.10
|
Form
of Indemnity Agreement.
|
Incorporated
by reference to Exhibit 10.9 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on November
10, 2005 (File No.
333-111656).
|
||
10.11
|
Mineral
Property Sale Agreement dated June 30, 2003.
|
Incorporated
by reference to Exhibit 10.1 to the Form SB-2, as amended,
filed with the
Securities and Exchange Commission on December 31,
2003 (File No.
333-111656).
|
||
10.12
|
2005
Equity Incentive Plan.
|
Incorporated
by reference to Exhibit 10.11 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on November
10, 2005 (File No.
333-111656).
|
||
10.13
|
Form
of Subscription Agreement.
|
Incorporated
by reference to Exhibit 10.1 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on December 19, 2005 (File No.
333-111656).
|
||
10.14 | Details of the Goldstrike Special Voting Share. | Incorporated by reference to Exhibit 10.14 to the Annual Report on Form 10-KSB/A for the period ended December 31, 2005 and filed with the Securities and Exchange on April 21, 2006 (File No. 333-111656). | ||
10.15 | Exchangeable Share Provisions. | Incorporated by reference to Exhibit 10.15 to the Annual Report on Form 10-KSB/A for the period ended December 31, 2005 and filed with the Securities and Exchange on April 21, 2006 (File No. 333-111656). | ||
10.16 | Refinery Contract between Refinor S.A.and Dong Wong Corporation - Golden Oil Corporation. | Incorporated by reference to Exhibit 10.16 to the Annual Report on Form 10-KSB/A for the period ended December 31, 2005 and filed with the Securities and Exchange on April 21, 2006 (File No. 333-111656). | ||
10.17 | Contract between Compañia General de Combustibles S.A. and Gran Tierra Energy Argentina S.A. | Incorporated by reference to Exhibit 10.17 to the Annual Report on Form 10-KSB/A for the period ended December 31, 2005 and filed with the Securities and Exchange on April 21, 2006 (File No. 333-111656). | ||
10.18 | Securities Purchase Agreement, dated May 25, 2006 between Gran Tierra Energy, Inc and Crosby Capital, LLC. | Incorporated by reference to Exhibit 10.18 to the Current Report on Form 8-K filed with the Securities and Exchange Commission on June 1, 2006 (File No. 333-111656). |
10.20
|
|
Form
of Securities Purchase Agreement, dated as of June
20, 2006, by and among
the Company and retail investors purchasing units
of Gran Tierra Energy
Inc. securities in a private offering.
|
Incorporated
by reference to Exhibit 10.20 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on June 21,
2006 (File No.
333-111656).
|
|
10.21
|
|
Form
of Subscription Agreement, dated as of June 20, 2006,
by and among Gran
Tierra Energy Inc. and retail investors subscribing
for units of Gran
Tierra Energy Inc. securities in a private offering.
|
Incorporated
by reference to Exhibit 10.21 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on June 21,
2006 (File No.
333-111656).
|
|
10.22
|
|
Securities
Purchase Agreement, dated as of June 20, 2006, by
and between Gran Tierra
Energy Inc. and CD Investment Partners, Ltd.
|
Incorporated
by reference to Exhibit 10.22 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on June 21,
2006 (File No.
333-111656)
|
|
10.23
|
|
Form
of Registration Rights Agreement, dated as of June
20, 2006, by and among
Gran Tierra Energy Inc. and institutional investors
purchasing units of
Gran Tierra Energy Inc. securities in a private offering.
|
Incorporated
by reference to Exhibit 10.23 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on June 21,
2006 (File No.
333-111656).
|
|
10.24
|
|
Form
of Registration Rights Agreement, dated as of June
20, 2006, by and among
Gran Tierra Energy Inc. and retail investors purchasing
units of Gran
Tierra Energy Inc. securities in a private offering.
|
Incorporated
by reference to Exhibit 10.24 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on June 21,
2006 (File No.
333-111656).
|
|
10.25
|
|
Registration
Rights Agreement, dated as of June 20, 2006, by and
between Gran Tierra
Energy Inc. and CD Investment Partners, Ltd.
|
Incorporated
by reference to Exhibit 10.25 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on June 21,
2006 (File No.
333-111656).
|
10.26
|
Lock-Up
Agreement, dated June 20, 2006, by and among Sanders
Morris Harris Inc.
and the executive officers and directors of Gran
Tierra Energy
Inc.
|
Incorporated
by reference to Exhibit 10.26 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on June 21,
2006 (File No.
333-111656)
|
||
10.27
|
Registration
Rights Agreement, dated as of June 20, 2006, by and
between Gran Tierra
Energy Inc. and Crosby Capital, LLC.
|
Incorporated
by reference to Exhibit 10.27 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on June 21,
2006 (File No.
333-111656).
|
||
10.28
|
Form
of Securities Purchase Agreement, dated as of June
30, 2006, by and among
Gran Tierra Energy Inc. and the investors in the
June 30, 2006 closing of
the Offering.
|
Incorporated
by reference to Exhibit 10.28 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on July 5,
2006 (File No.
333-111656)
|
||
10.29
|
Form
of Subscription Agreement, dated as of June 30, 2006,
by and among Gran
Tierra Energy Inc. and the investors in the June
30, 2006 closing of the
Offering.
|
Incorporated
by reference to Exhibit 10.29 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on July 5,
2006 (File No.
333-111656).
|
||
10.30
|
Form
of Registration Rights Agreement, dated as of June
30, 2006, by and among
Gran Tierra Energy Inc. and the investors in the
June 30, 2006 closing of
the Offering.
|
Incorporated
by reference to Exhibit 10.30 to the Current Report
on Form 8-K filed with
the Securities and Exchange Commission on July 5,
2006 (File No.
333-111656).
|
10.31 | Form of Escrow Agreement** |
10.32 | Form of Registration Rights Agreement by and among Goldstrike Inc. and the purchasers named therein** | |||
10.33 | Form of Subscription Agreement by and among Goldstrike Inc., Gran Tierra Energy, Inc. and the investor identified therein** | |||
10.34 | Form of Registration Rights Agreement by and among Gran Tierra Energy, Inc. f/k/a Goldstrike, Inc. and the purchasers named therein** |
10.35 | Form of Subscription Agreement by and among Gran Tierra Energy, Inc. f/k/a Goldstrike, Inc. and the investor identified therein** |
10.36 | Executive Employment Agreement, dated December 1, 2006, by and between Gran Tierra Energy Inc. and Martin H. Eden. | Incorporated by reference to Exhibit 10.36 to the current report on Form 8-K filed with the Securities and Exchange Commission on January 3, 2007. |
16.1 | Letter from Moen and Company |
Incorporated
by reference to Exhibit 16.1 to the current report on Form 8-K/A
filed with the Securities and Exchange Commission
on June 1, 2006 (File
No. 333-111656).
|
||
21.1
|
List
of subsidiaries.
|
Incorporated
by reference to Exhibit 21.1 to the Annual Report
on Form 10-KSB filed
with the Securities and Exchange Commission on March
10, 2006 (File
No. 333-111656).
|
||
23.1
|
Consent
of McGuireWoods LLP (included in Exhibit 5.1).
|
|||
23.2
|
Consent
of Deloitte & Touche LLP.*
|
|||
23.3 | Consent of Deloitte & Co. S.R.L.* | |||
23.4 | Consent of Gaffney, Cline and Associates ** | |||
23.5 | Consent of KPMG Ltda.* |
23.6 | Consent of Huddleston & Co. Inc.** |
Gran Tierra Energy Inc. | ||
|
|
|
By: | /s/ Dana Coffield | |
Name: Dana
Coffield
Title: President
and Chief Executive Officer
|
||
Signature
|
Title
|
Date
|
||
/s/
Dana Coffield
|
President
Chief
Executive Officer Director
|
February
13, 2007
|
||
Dana
Coffield
|
(Principal
Executive Officer)
|
|||
/s/
Martin Eden
|
Chief
Financial Officer
|
February
13, 2007
|
||
Martin
Eden
|
(Principal
Financial Officer and Principal Accounting Officer)
|
|||
/s/Jeffrey
Scott
|
Chairman
of the
|
February
13, 2007
|
||
Jeffrey
Scott
|
Board
of Directors
|
|||
/s/Walter
Dawson
|
Director
|
February
13, 2007
|
||
Walter
Dawson
|
||||
/s/Verne
Johnson
|
Director
|
February
13, 2007
|
||
Verne
Johnson
|
||||
/s/Nadine
C. Smith
|
Director
|
February
13, 2007
|
||
Nadine
C. Smith
|
||||
/s/
James Hart
|
Director
|
February
13, 2007
|
||
James
Hart
|
Exhibit
No.
|
Description
|
Reference
|
3.1
|
Articles
of Incorporation.
|
Incorporated
by reference to Exhibit 3.1 to the Form SB-2, as amended, filed
with the
Securities and Exchange Commission on December 31, 2003 (File No.
333-111656).
|
||
3.2
|
Certificate
Amending Articles of Incorporation.
|
Incorporated
by reference to Exhibit 3.2 to the Form SB-2, as amended, and
filed with
the Securities and Exchange Commission on December 31, 2003 (File No.
333-111656).
|
||
3.3
|
Bylaws.
|
Incorporated
by reference to Exhibit 3.3 to the Form SB-2, as amended, filed
with the
Securities and Exchange Commission on December 31, 2003 (File No.
333-111656).
|
||
3.4
|
Certificate
Amending Articles of Incorporation.
|
Incorporated
by reference to Exhibit 3.4 to the Current Report on Form 8-K
filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
3.5
|
Certificates
of Amendment to Articles of Incorporation.
|
Incorporated by reference to Exhibit 3.5 to the Current Report on Form 8-K filed with the Securities and Exchange Commission on June 1, 2006 (File No. 333-111656). | ||
3.6
|
Amended
and Restated Bylaws of Gran Tierra Energy Inc.
|
Incorporated
by reference to Exhibit 3.5 to the Current Report on Form 8-K
filed with
the Securities and Exchange Commission on June 21, 2006 (File
No.
333-111656).
|
||
4.1
|
Form
of Warrant.
|
Incorporated
by reference to Exhibit 4.1 to the Current Report on Form 8-K
filed with
the Securities and Exchange Commission on December 19, 2005
(File No.
333-111656).
|
5.1
|
Opinion
of McGuireWoods LLP.*
|
10.1
|
Share
Purchase Agreement by and between Goldstrike Inc. and Gran
Tierra Energy
Inc. dated as of November 10, 2005.
|
Incorporated
by reference to Exhibit 10.1 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.2
|
Form
of Registration Rights Agreement by and among Goldstrike Inc.
and the
purchasers named therein.
|
Incorporated
by reference to Exhibit 10.2 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on December 19, 2005
(File No.
333-111656).
|
Exhibit
No.
|
Description
|
Reference
|
10.3
|
Assignment
Agreement by and between Goldstrike Inc. and Gran Tierra Goldstrike
Inc.
dated as of November 10, 2005.
|
Incorporated
by reference to Exhibit 10.2 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.4
|
Voting
Exchange and Support Agreement by and between Goldstrike, Inc.,
1203647
Alberta Inc., Gran Tierra Goldstrike Inc. and Olympia Trust
Company dated
as of November 10, 2005.
|
Incorporated
by reference to Exhibit 10.3 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.5
|
Form
of Split Off Agreement by and among Goldstrike Inc., Dr. Yenyou
Zheng,
Goldstrike Leasco Inc. and Gran Tierra Energy Inc.
|
Incorporated
by reference to Exhibit 10.4 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.6
|
Employment
Agreement between Gran Tierra Energy Inc. and Dana Coffield
dated as of
April 29, 2005, as amended.
|
Incorporated
by reference to Exhibit 10.5 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.7
|
Employment
Agreement between Gran Tierra Energy Inc. and James Hart dated
as of April
29, 2005, as amended.
|
Incorporated
by reference to Exhibit 10.6 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.8
|
Employment
Agreement between Gran Tierra Energy Inc. and Max Wei dated
as of April
29, 2005, as amended.
|
Incorporated
by reference to Exhibit 10.7 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.9
|
Employment
Agreement between Gran Tierra Energy Inc. and Rafael Orunesu
dated as of
March 1, 2005, as amended.
|
Incorporated
by reference to Exhibit 10.8 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
Exhibit
No.
|
Description
|
Reference
|
10.10
|
Form
of Indemnity Agreement.
|
Incorporated
by reference to Exhibit 10.9 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.11
|
Mineral
Property Sale Agreement dated June 30, 2003.
|
Incorporated
by reference to Exhibit 10.1 to the Form SB-2, as amended,
filed with the
Securities and Exchange Commission on December 31, 2003 (File
No.
333-111656).
|
||
10.12
|
2005
Equity Incentive Plan.
|
Incorporated
by reference to Exhibit 10.11 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on November 10, 2005
(File No.
333-111656).
|
||
10.13
|
Form
of Subscription Agreement.
|
Incorporated
by reference to Exhibit 10.1 to the Current Report on Form
8-K filed with
the Securities and Exchange Commission on December 19, 2005 (File No.
333-111656).
|
||
10.14 | Details of the Goldstrike Special Voting Share. | Incorporated by reference to Exhibit 10.14 to the Annual Report on Form 10-KSB/A for the period ended December 31, 2005 and filed with the Securities and Exchange on April 21, 2006 (File No. 333-111656). | ||
10.15 | Exchangeable Share Provisions. | Incorporated by reference to Exhibit 10.15 to the Annual Report on Form 10-KSB/A for the period ended December 31, 2005 and filed with the Securities and Exchange on April 21, 2006 (File No. 333-111656). | ||
10.16 | Refinery Contract between Refinor S.A.and Dong Wong Corporation - Golden Oil Corporation. | Incorporated by reference to Exhibit 10.16 to the Annual Report on Form 10-KSB/A for the period ended December 31, 2005 and filed with the Securities and Exchange on April 21, 2006 (File No. 333-111656). | ||
10.17 | Contract between Compañia General de Combustibles S.A. and Gran Tierra Energy Argentina S.A. | Incorporated by reference to Exhibit 10.17 to the Annual Report on Form 10-KSB/A for the period ended December 31, 2005 and filed with the Securities and Exchange on April 21, 2006 (File No. 333-111656) | ||
10.18 | Securities Purchase Agreement, dated May 25, 2006 between Gran Tierra Energy, Inc and Crosby Capital, LLC. | Incorporated by reference to Exhibit 10.18 to the Current Report on Form 8-K filed with the Securities and Exchange Commission on June 1, 2006 (File No. 333-111656). |
10.20
|
|
Form
of Securities Purchase Agreement, dated as of June 20,
2006, by and among
the Company and retail investors purchasing units of Gran
Tierra Energy
Inc. securities in a private offering.
|
Incorporated
by reference to Exhibit 10.20 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on June 21, 2006
(File No.
333-111656).
|
|
10.21
|
|
Form
of Subscription Agreement, dated as of June 20, 2006, by
and among Gran
Tierra Energy Inc. and retail investors subscribing for
units of Gran
Tierra Energy Inc. securities in a private offering.
|
Incorporated
by reference to Exhibit 10.21 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on June 21, 2006
(File No.
333-111656).
|
|
10.22
|
|
Securities
Purchase Agreement, dated as of June 20, 2006, by and between
Gran Tierra
Energy Inc. and CD Investment Partners, Ltd.
|
Incorporated
by reference to Exhibit 10.22 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on June 21, 2006
(File No.
333-111656).
|
|
10.23
|
|
Form
of Registration Rights Agreement, dated as of June 20,
2006, by and among
Gran Tierra Energy Inc. and institutional investors purchasing
units of
Gran Tierra Energy Inc. securities in a private offering.
|
Incorporated
by reference to Exhibit 10.23 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on June 21, 2006
(File No.
333-111656).
|
|
10.24
|
|
Form
of Registration Rights Agreement, dated as of June 20,
2006, by and among
Gran Tierra Energy Inc. and retail investors purchasing
units of Gran
Tierra Energy Inc. securities in a private offering.
|
Incorporated
by reference to Exhibit 10.24 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on June 21, 2006
(File No.
333-111656).
|
|
10.25
|
|
Registration
Rights Agreement, dated as of June 20, 2006, by and between
Gran Tierra
Energy Inc. and CD Investment Partners, Ltd.
|
Incorporated
by reference to Exhibit 10.25 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on June 21, 2006
(File No.
333-111656).
|
10.26
|
Lock-Up
Agreement, dated June 20, 2006, by and among Sanders Morris
Harris Inc.
and the executive officers and directors of Gran Tierra
Energy
Inc.
|
Incorporated
by reference to Exhibit 10.26 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on June 21, 2006
(File No.
333-111656).
|
||
10.27
|
Registration
Rights Agreement, dated as of June 20, 2006, by and between
Gran Tierra
Energy Inc. and Crosby Capital, LLC.
|
Incorporated
by reference to Exhibit 10.27 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on June 21, 2006
(File No.
333-111656).
|
||
10.28
|
Form
of Securities Purchase Agreement, dated as of June 30,
2006, by and among
Gran Tierra Energy Inc. and the investors in the June 30,
2006 closing of
the Offering.
|
Incorporated
by reference to Exhibit 10.28 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on July 5, 2006
(File No.
333-111656).
|
||
10.29
|
Form
of Subscription Agreement, dated as of June 30, 2006, by
and among Gran
Tierra Energy Inc. and the investors in the June 30, 2006
closing of the
Offering.
|
Incorporated
by reference to Exhibit 10.29 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on July 5, 2006
(File No.
333-111656).
|
||
10.30
|
Form
of Registration Rights Agreement, dated as of June 30,
2006, by and among
Gran Tierra Energy Inc. and the investors in the June 30,
2006 closing of
the Offering.
|
Incorporated
by reference to Exhibit 10.30 to the Current Report on
Form 8-K filed with
the Securities and Exchange Commission on July 5, 2006
(File No.
333-111656).
|
10.31 | Form of Escrow Agreement** |
10.32 | Form of Registration Rights Agreement by and among Goldstrike Inc. and the purchasers named therein** | |||
10.33 | Form of Subscription Agreement by and among Goldstrike Inc., Gran Tierra Energy, Inc. and the investor identified therein** | |||
10.34 | Form of Registration Rights Agreement by and among Gran Tierra Energy, Inc. f/k/a Goldstrike, Inc. and the purchasers named therein** | |||
10.35 | Form of Subscription Agreement by and among Gran Tierra Energy, Inc. f/k/a Goldstrike, Inc. and the investor identified therein** |
10.36 | Executive Employment Agreement dated December 1, 2006, by and between Gran Tierra Energy Inc. and Martin H. Eden. | Incorporated by reference to Exhibit 10.36 to the current report on Form 8-K filed with the Securities and Exchange Commission on January 3, 2007. |
16.1 | Letter from Moen and Company |
Incorporated
by reference to Exhibit 16.1 to the current report on Form 8-K/A
filed with the Securities and Exchange Commission on June
1, 2006 (File
No. 333-111656).
|
||
21.1
|
List
of subsidiaries.
|
Incorporated
by reference to Exhibit 21.1 to the Annual Report on Form
10-KSB filed
with the Securities and Exchange Commission on March 10,
2006 (File
No. 333-111656).
|
||
23.1
|
Consent
of McGuireWoods LLP (included in Exhibit 5.1).
|
|||
23.2
|
Consent
of Deloitte & Touche LLP.*
|
|||
23.3 | Consent of Deloitte & Co. S.R.L.* | |||
23.4 | Consent of Gaffney, Cline and Associates ** | |||
23.5 | Consent of KPMG Ltda.* |
23.6 | Consent of Huddleston & Co. Inc.** |