CALGARY – Gran Tierra Energy Inc. has lined up its third major Colombian acquisition of 2016.
The Calgary-based company (TSX:GTE) has agreed to pay US$525 million cash for PetroLatina Energy Ltd.
Gran Tierra says the acquisition will increase its land position in a prolific part of Colombia and add 53 million barrels to its proven and probable reserves.
It will raise $173.5 million from a syndicated equity issue and get up to $130 million in bridge financing from Scotiabank (TSX:BNS), its lead lender. Gran Tierra also had $163.3 million of cash as of May 31.
In January, Gran Tierra completed the acquisitions of Petroamerica Oil Corp. and PetroGrenada Ltd. as part of a strategy to grow and diversify its holdings throughout Colombia.
In May, the company announced its 2016 capital budget would be increased to between US$140 million and US$150 million, from the previously announced US$107 million.
The PetroLatina deal was announced late last week and is expected to close by Oct. 31.