GeoPark Limited Halts Acquisition as Ecopetrol Exercises Preemptive Rights
GeoPark Limited (GPRK) has announced that it will not proceed with its planned acquisition of the CPO-9 block in Colombia due to Ecopetrol S.A. (EC) exercising its preemptive rights. According to their Joint Operating Agreement, Ecopetrol, which holds a 55% working interest in the block, has the right to acquire the 45% non-operated interest owned by Repsol, S.A. (REPYY).
GeoPark’s acquisition initiative was originally unveiled on November 29, 2024, when the company expressed its intention to obtain REPYY’s upstream oil and gas assets in Colombia.
GeoPark’s Acquisition Plans Overview
As a key player in the Latin American energy sector, GeoPark, currently rated #3 (Hold) by Zacks, aimed to acquire a 45% working interest in the CPO-9 Block and a 25% interest in SierraCol Energy Arauca LLC. This move was part of its “North Star” strategy, which intends to secure valuable assets in the Llanos Basin to enhance production and cash flow.
However, with Ecopetrol’s decision to exercise its preemptive rights, the company’s acquisition strategy faces a significant shift. Ecopetrol remains focused on leveraging opportunities within Colombia’s eastern Llanos Basin.
New Opportunities in Arauca’s Llanos Norte Project
Despite the setback with the CPO-9 block, GeoPark is eyeing a different opportunity. The company still has the option to acquire a 25% stake in SierraCol Energy Arauca LLC in the Arauca Department. Currently, the partners involved have not yet exercised their preemptive rights, allowing GeoPark to potentially move forward with this acquisition.
Acquiring this stake aligns with GeoPark’s aim to bolster its footprint in the dynamic Latin American energy market. With a robust financial foundation, the company remains well-equipped to pursue other strategic acquisitions.
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Ecopetrol S.A. (EC): Free Stock Analysis Report
Repsol SA (REPYY): Free Stock Analysis Report
GeoPark Ltd (GPRK): Free Stock Analysis Report
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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
