- Oil producer, Gran Tierra Energy (TSX:GTE) has made further cuts to daily production, which remains unprofitable after the recent oil price crash
- The company has reduced output from its minor oil fields by 2,500 barrels a day, on top of a 4,000 barrel-a-day reduction previously announced
- The company will leave 4,800 barrels a day of production offline, despite plans to recommence after maintenance work finished
- Due to the difficult oil and gas market, Gran Tierra is applying for the Colombian Government’s industry aid package
- Gran Tierra Energy (GTE) is down 6.25 per cent, with shares trading for C$0.38 and a $129.6 million market cap
Oil producer, Gran Tierra Energy (TSX:GTE) has made further cuts to daily production, which remains unprofitable in the current market.
The recent oil price drop is forcing energy companies to drastically reassess production levels. Many company’s production levels won’t be viable until the market improves.
After reassessing unprofitable production at its oil fields, the company has reduced output by 2,500 barrels a day. This latest production cut is on top of a 4,000 barrels a day reduction, which Gran Tierra previously announced.
Furthermore, the company planned to recommence 4,800-barrels worth of oil assets after maintenance work finished. However, in an effort to cut further unprofitable production, Gran Tierra is leaving these assets offline until oil prices improve.
To help weather the coming months, Gran Tierra is applying for the Colombian Government’s recently announced industry aid package.
Through the plan, the company will receive expedited tax back, to be utilised during the challenging present environment. The aid package also allows more time for explorations efforts and some debt relief measures.
Despite the challenging period, Gran Tierra’s President and CEO, Gary Guidry, remains confident about the company’s future.
“We believe Gran Tierra has a competitive advantage to withstand the current challenging environment. The company has taken aggressive actions to protect its balance sheet and cash flows.
“We will continue to monitor the near and long-term commodity price environment and leverage our financial and operational flexibility to further adjust our plans should it become necessary,” he said.
Gran Tierra Energy (GTE) is down 6.25 per cent, with shares trading for C$0.38 at 12:55am EST.