GeoPark Ltd

Billionaire shale pioneer Harold Hamm's Continental Resources Inc. reached a deal to operate and develop the Ayacucho 2 Block in Venezuela's Orinoco Belt, as the Trump administration pushes US companies to revive the nation's oil sector. The Oklahoma City-based company said the block covers about 126,000 acres and holds an estimated 30 billion barrels. Continental signed a memorandum of understanding with Venezuela's state oil company and plans to have a long-term agreement in place within weeks. The agreement by Hamm, a significant donor to US President Donald Trump, adds to a slate of deals in recent weeks aimed at boosting Venezuela's crude production, including agreements announced by Chevron Corp., GE Vernova Inc. and Eni SpA alongside Wright and acting Venezuelan President Delcy Rodríguez at a signing ceremony in Caracas, as well as deals signed by Geopark Limited and privately held Aspect Holdings. Wright said the deals represent "tens of billions" worth of investments that marked a "transformation for Venezuela," though some analysts have questioned their durability given lingering concerns about contract sanctity in a nation with a history of nationalization.

GeoPark Limited announced its strategic entry into Venezuela through the acquisition of the Bare Block, a large heavy-oil asset in the Orinoco Belt, under a 25-year Production Participation Contract with state-owned PDVSA, holding a 65% net working interest and funding all capital expenditures. The deal is expected to boost production from roughly 31,000 boepd to 70,000-83,000 boepd by the end of the decade, with cumulative net production of about 400 million barrels and an improved recovery factor from 4%-5% to 8%-9%. This move aligns with the Trump administration's push to open Venezuela's oil industry, which holds the world's largest proven crude reserves at about 17% of the global total. CEO Felipe Bayon highlighted the massive scale and redevelopment potential, while noting the company's capital discipline and regional expertise. However, risks include aging infrastructure, political uncertainty, and regulatory challenges, as Venezuela's output has fallen from over 3 million bpd two decades ago to around 1.25 million bpd, though U.S. Energy Secretary Chris Wright expects it to reach 2 million bpd by 2030. At the end of Q2 2026, 18 hedge funds held GPRK, with their cumulative stake value decreasing from $62.3 million to just over $50.1 million.

Chevron Corporation and GE Vernova Inc., along with India's ONGC, Italy's Eni, and Colombia's GeoPark, are reportedly close to signing final agreements for energy projects in Venezuela, marking another step toward reopening the country's energy sector to foreign investment. Most agreements would move existing oil contracts under Venezuela's amended hydrocarbons law, offering foreign companies more flexibility to operate and expand fields, export crude, and receive cash proceeds, while some would cover new electricity and energy projects. Chevron is seeking to add a block in the Orinoco Belt to expand its joint venture with state-owned PDVSA and an area in Monagas North for diluents, potentially boosting its long-term production. GE Vernova could benefit from demand for power-generation and grid equipment as Venezuela's oil revival requires reliable electricity. However, risks remain as the final list of companies and terms is not yet finalized, and experts have raised questions about the transparency and legal foundation of the broader U.S.-Venezuela oil agreement, with substantial capital requirements and potential years before benefits translate into cash flow.

West Texas Intermediate (WTI) crude futures on the New York Mercantile Exchange closed higher on Monday (Aug. 31) after the United States and Iran opened a new round of clashes, raising investor concerns that the conflict, now in its sixth month, could disrupt global oil supplies. The October WTI contract rose $2.36, or 2.83%, to settle at $85.76 per barrel, while the October Brent contract gained $2.39, or 2.71%, to close at $90.49 per barrel. The U.S. Central Command (CENTCOM) confirmed that U.S. forces struck two Iranian rocket launch sites on Larak Island near the Strait of Hormuz after detecting that the IRGC was preparing to launch mine-laden rockets into the strait. Iran retaliated by firing missiles at a U.S. base in Jordan and sending drones to attack Al Minhad Air Base in the UAE. President Donald Trump announced retaliation against Iran and threatened to destroy Kharg Island, a key oil export terminal. Shipping through the Strait of Hormuz has been severely affected, with the number of commodity-carrying vessels dropping to just 5 per day, down from 125-140 per day before the war. Analysts at PVM Oil Associates noted that supply risks remain and expect oil inventories to continue declining. Meanwhile, Trump said oil from a deal with Venezuela would be used to replenish the Strategic Petroleum Reserve (SPR), which has fallen to its lowest level in nearly 44 years. Reports also indicate that Chevron, GE Vernova, ONGC, Eni, and GeoPark are preparing to sign final agreements in Venezuela after months of negotiations.

GeoPark reported second quarter 2026 results with production averaging 37.3 thousand barrels of oil equivalent per day, revenue of $143.3 million, adjusted EBITDA of $73.1 million, and net income of $14 million. The company declared a quarterly dividend of $0.023 per share and increased its cash position to $316 million while reducing net leverage to 1.2 times EBITDA. In Argentina, GeoPark completed drilling on pad 1.03 thousand, secured a three-year drilling rig agreement, and applied to the RIGI Investment Incentive Program with Gas y Petroleo del Neuquen. Management also discussed potential opportunities in Colombia and Venezuela, and indicated full-year capital expenditures could reach $250 million, up from a prior range of $190 million to $220 million.