Calgary-based Gran Tierra Energy plans US$525M PetroLatina acquisition

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 PetroLatina acqusition will increase its land position in in a prolific part of Colombia and add 53 million barrels to its proven and probable reserves.

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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 acquistions 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.