James Park - CEO Augusto Zubillaga - COO Andres Ocampo - CFO.

Felipe Santos - JP Morgan Shahin Amini - Pareto Securities.

Good morning and welcome to the GeoPark Limited Conference Call following the results announcement for the Third Quarter ended September 30, 2017. After the speakers' remarks, there will be a question-and-answer session.

[Operator Instructions] If you do not have a copy of the press release, please call Sard Verbinnen & Company in New York at +1-212-687-8080 and we will have one sent to you. Alternatively, you may obtain a copy of the release at the investor support section on the Company's corporate website at www.geo-park.com.

A replay of today's call may be accessed through the webcast in the investor support section of GeoPark corporate website.

Before we continue please note that certain statements contained in the results press release and on this conference call are forward-looking statements rather than historical facts and are subject to risks and uncertainties that could cause actual results to differ materially from those described.

With respect to such forward-looking statements the Company seeks protection afforded by the Private Securities Litigation Reform Act of 1995. These risks include a variety of factors including competitive development and risk factors listed from time to time in the Company's SEC reports and public releases.

Those risks are intended to identify certain principal factors that could cause actual results to differ materially from those described in the forward-looking statements but are not intended to represent a complete list of the Company's business. All financial figures included herein were prepared in accordance with the IFRS and are stated in U.S.

dollars unless otherwise noted. Reserve figures correspond to PRMS standard. On the call today from GeoPark is James F. Park, Chief Executive Officer; Augusto Zubillaga, Chief Operating Officer; Andres Ocampo, Chief Financial Officer; and Diego Ugoli [ph], Capital Markets Manager. And now, I'll turn the call over to Mr. James Park. Mr.

Park, you may begin..

Thank you and welcome everyone. We are joining you this morning with our executive team from Bogota, Columbia, to report on our progress this year with our third quarter 2017 results and to answer any questions.

It was another powerful quarter with important operational, financial and strategic wins that continue building momentum for a successful completion of 2017 and an exciting outlook for 2018. Our team did its job by growing every component of our business plan.

Production continues to increase with over 30,000 barrels per day today as our drilling keeps finding oil and pushing out the boundaries of our key oil fields in Columbia. With our successful drilling results, GeoPark became the third largest operator in Columbia, a milestone accomplished in just five years beginning from scratch.

We also added Argentina to our list of producing countries following our new oil field discovery in Neuquen Basin. Our cost reduction efforts and innovations continue to decrease operating and capital costs and increase netbacks making our production more profitable at lower oil prices.

Our key financial metrics showed improvement and our cash flow more than doubled. We strengthened our balance sheet by a successful refinancing of our debt with a new long-term bond that provides more funds, extends our maturities, increases flexibility and lowers our borrowing costs.

We also vested new highly-prospective acreage to our expanding multi-country project portfolio by successful acquisitions in Brazil and Colombia, including an attractive block adjacent to our prized Llanos 34 Block.

Looking towards 2018, we have a full speed ahead and capital efficient $100 million investment plan which provides for us to produce, develop, and explore our assets and meaningfully grow our business in 2018, all funded by our own generated cash flow and with enough firepower set aside for new attractive acquisition opportunities.

We believe this structure differentiates GeoPark from many oil and gas companies, and is the right formula for an E&P company to achieve enduring success in today's world.

Our team is ready and excited about our upcoming 2018 work program which includes drilling over 30 new wells targeted to extend our 15-year track record of production and reserve growth and adaptable to succeed in any oil price scenario. Now let's please go to Zubi..

Okay, thank you, Jim. So this quarter, we shall once again demonstrated our ability to find oil and gas and our proficiency as operators, as oil and gas finders. In Colombia we continued unlocking value from our Llanos 34 Block with both development and exploration drilling.

With the new Curucucu one exploration well, we discovered a new Curucucu oil field, [indiscernible] opening up the southeast region of the block. We drilled five wells for the test and pushed out in northern, western, and southern boundaries of the Tigana/Jacana oil fields.

Three of these wells, which is Jacana 10, Jacana 12 and Tigana Norte 2 have been tested on full production with over 6,000 barrels of oil per day. And two wells, Tigana 17 and 13 will be completed this quarter. Also Tigana Sur Oeste 7 is being tested now.

The recent successful drilling of Tigana Norte 2 and 3 wells were encouraging and appear to be extending the field in this area with lower known oil depth. We are currently drilling Tigana Norte 4, further downbeat of Tigana Norte 3 and expect to have news in the following weeks.

As operator, in the third quarter, our consolidated oil and gas production increased by 28% to a record of more than 28,000 barrels of oil per day with Colombian oil production jumping by 43% to more than 22,000 barrels of oil per day.

Today, our gross operated production is over 55,000 barrels of oil per day, and we have already exceeded our exit net production guidance for the year of 30,000 barrels of oil per day. And to complete this great year, we still have the opportunity to drill another 6 wells in Columbia during the fourth quarter.

We started production in Argentina at our new Rio Grande Oeste oil field, and we will be drilling more in Argentina next quarter in the Sierra del Nevado Block. We also will be building our new prospect in the Potiguar Basin in Brazil during December 2017.

So for 2018, our work program will be focused on further developing and operating the Tigana/Jacana oil play in Llanos 34 block. We have plan to drill approximately 23 to 24 wells including 5 to 6 operation wells.

We also plan to construct a 30 kilometer flow line connecting our Tigana/Jacana complex to the Columbian pipeline system to further reduce operating and transportation costs. And in our new Tiple acreage adjacent to the Llanos 34 block, we look forward to drilling an attractive exploration prospect during the next year.

We will also carry out operations in the rest of our asset portfolio, advancing our projects in each country, including production operations in Chile, Argentina, and Brazil, and also new exploration drilling in Argentina and Brazil. So now, over to Andres..

Thank you, Zubi. During the third quarter this year and following our significant production growth, our EBITDA more than doubled and reached $45 million, representing an EBITDA for the last 9 months of $120 million.

Our operating cash flow for the quarter of $38 million fully funded our CapEx program, and allowed us to continue growing within cash flow again.

Our cost reduction efforts, continue generating good results with operating expenses down 14% to just $7.3 per barrel, allowing us to generate operating netbacks of approximately $23 for each barrel that we produced. We successfully completed a new borne transaction in September and placed our new $425 million 7-year notes with a coupon of 6.5%.

Proceeds were used to fully repay our previous 20-20 notes of the Itau [ph] loan, and the remaining cash will be used for CapEx and general corporate purposes.

With this new transaction we were able to extend our debt maturities, reduce our financial costs, achieve more flexible covenants and increase our cash position to $135 million as of the end of the quarter. These combined with our increased EBITDA generation allowed us to reduce our net leverage ratio down from 4.7 times to 1.9 times.

The transaction was oversubscribed by 6 times, an attractive demand from Top Tier high quality investors. Our self-funded 2017 work program is again hitting the mark with another year of growth expecting production to be in the upper range of our 20% to 25% growth guidance. We also look forward to an exciting highly impact 2018 program.

We just completed our capital allocation process through which following the review of over a 100 projects in our five country platform, we have selected approximately 50 projects for total investment of $100 million to $110 million fully funded within cash flow to target a production growth of 15% to 20% with the main focus remaining in our core asset in Columbia where we expect to allocate over 85% of our investment program.

We have also continued to broaden our audience in the markets and our increased stock trading volume have remained between $1 million to $1.5 million per day. So, thank you. And now we invite any questions for our time..

[Operator Instructions] Our first question comes from the line of Felipe Santos of JP Morgan..

Just some quick questions here at my side.

First one, Jim, could you be a little bit more specific or give any other detail on the exploration campaign that you're targeting for Columbia? How many of those wells, if I am not mistaken, about 20-30 wells should be to delineate the size of Llanos, the discoveries in Llanos 34 and how much of those would be to put -- to increase the production or to deliver the growth, meaning that’s just [indiscernible] breakdown of exploratory and what would be targeting the increasing reserves side? That's it for me.

Thank you..

Thank you, Felipe. So you're asking about the exploration campaign for next year and how much of that is targeted to continue delineating the Llanos 34 play..

Exactly..

I will give you a breakdown of the wells we're drilling all over our platform, and how many of those are exploration; so total wells are over 30 wells on a gross basis across the whole company.

In Llanos 34, around 20 to 21 wells are going to be drilled there, so total wells for Llanos 34, roughly 20 to 21 from which 3 are exploration wells which are new prospects outside the Tigana/Jacana play. So these are new exploration prospects in other full tranche [ph] different from Jacana/Tigana.

The rest are mostly development and appraisal wells to continue developing and delineating the Tigana/Jacana complex or maybe one more well developing the Curucucu recent discovery, but most of it is right to assume that everything else is going to be development and appraisal in the Tigana/Jacana complex.

Then we have one exploration well in Tiple which is the adjacent block operated by GeoPark 85% working interest. As expected first half next year, that's one exploration well. Then we have two exploration wells in Llanos 32 where we only have 12.5%, that's operated -- is not operated by GeoPark.

We have two exploration wells in Brazil and 7 exploration wells in Argentina; one of them operated by GeoPark in the CN-V block in partnership with Wintershall, 50% ownership and the other 6 are again in the Sierra del Nevado and Puelen blocks where we have an 18% working interest. So that gives you the total program.

Approximately from the $100 million to $110 million that we are investing next year, around 20% to 25% is what we just mentioned as exploration. Everything else is development, appraisal, and facilities..

Okay, thanks so much..

[Operator Instructions] Our next question comes from the line of Shahin Amini of Pareto Securities..

First of all, congratulations on a solid quarter, and also on your highly successful refinancing. I’ll put on a sad note, my condolences on the passing of Michael Dingman, your Board Member, very sad news.

Two questions from me; first of all, on your planned expenditure on building a new floor line in order to support production growth and reduce operating costs, can you just give more detail on that and what do you expect see in terms of cost savings? And second question is, in relation to the Tiple block, which is adjacent at Llanos 34; could you provide more detail? I do understand that you have 3D seismic over the block, and given your success, I suppose you have a good fill for the sub-surface drivers there.

Could you provide more on this -- the prospect that you would be targeting in the first half of next year? Thank you..

Thank you for your comments about Mike Dingman. First question about the flow line between Llanos 34; so effectively that's approximately 30 kilometer flow line that will connect the Jacana area with the ODL pipeline, the new Llanos pipeline.

We are starting -- we have completed environmental approvals recently and we're going to finish the engineering of the project, so we're going to start constructing it in the next few months. We expect that to be completed by the fourth quarter of 2018, the total cost net to GeoPark is around $16 million to $20 million or $15 million to $20 million.

We expect that to first simplify the operation in the whole block and that will also come with a reduction on operating expense. And then, also we obviously expect the reduction on the transportation cost that could be around $1 to $2 per barrel.

Then, we think it also have strategic advantages because of the place where it is located; it's in the middle of the Llanos Basin where there is a lot of production coming. So we think this is a great project and it is going to improve and give a lot of efficiencies to our operations and obviously, reduce our transportation costs.

Then your second question about Tiple; this was a great acquisition for us. The former operator of the block is the Spanish Company, CEPSA, we did our farming with them through which we acquired 85% on the operatorship of the block through drilling one exploration well; so we think these are very attractive terms.

The block is covered with 3D seismic, that our team mapped and accessed to and did a very thorough study. It identified a couple of prospects and there’s one that we like very much. We think some of the ideas that we're doing in Llanos 34 can be replicated in some of the areas around it, we think Tiple is one of them.

So the size is still to be seen but we're very excited about it, we expect to drill this at the beginning of next year, and we have high expectations -- sorry, the first half of next year and have high expectations around this prospect. We think it's very exciting news..

And -- I know this is about the second question and you may want to avoid it but -- and are you able to provide some numbers on the prospective resources you're targeting or is that something we need to wait for until next year?.

Well, we want to include some of those and when we announced our research certification and our resources, audit by [indiscernible], we wanted to provide some guidance around what we're seeing..

Okay. Thank you very much..

[Operator Instructions] At this time I'm showing no further question. I would like to turn the floor back over to James Park for any additional or closing remarks..

Well, thank you to everybody for your interest in GeoPark and your continued support of our Company. We encourage you to please visit us at our operations and invite you, please, to call us at any time for any information. Thank you and good day..

Thank you, ladies and gentlemen. This does conclude today's conference call. You may now disconnect..