FRONTERA ANNOUNCES RESULTS OF SPECIAL SHAREHOLDER MEETING

• The most recent news (April 30, 2026) confirms that Frontera Energy shareholders have approved a plan of arrangement allowing Parex Resources Inc. to acquire Frontera's Colombian upstream business.
• The transaction involves a purchase price of US$500 million payable at closing plus a contingent US$25 million payment.
• Following the deal, Frontera will transition into an infrastructure company, while Parex acquires the E&P assets (17 blocks, >1.1 million net acres).
• Concurrently, Parex released preliminary Q1 2026 results showing production of 44,735 boe/d but a significant drop in net income to $5 million compared to $81 million in Q1 2025.
• The decline in profitability is attributed to a $29 million cost from unwinding Brent crude oil hedges and one-time costs totaling approximately $17 million.
• Bank debt increased significantly to $175 million from $50 million in the prior year, driven by the acquisition deposit for Frontera and the purchase of GeoPark shares (which were not acquired).

• The shareholder approval is a critical milestone that removes execution risk for the Parex-Frontera transaction. This deal was announced definitively on March 10, 2026, so the April vote was anticipated by the market.
• While the approval is positive, it does not exceed expectations as the stock price had already rallied from ~$21 in late February to ~$28 by late April in anticipation of this outcome.
• The Q1 financial results introduce a negative counterweight: net income dropped 94% year-over-year due to non-cash hedge unwind costs and one-time expenses.
• The increase in bank debt to $175 million raises short-term leverage concerns, although management expects the acquisition to be immediately accretive to funds flow per share (>40%).
• The news confirms the strategic pivot for Parex to become the largest independent Colombia-focused energy company, doubling production on a pro-forma basis.

• Parex Resources Inc. is an independent oil and gas company focused on Colombia.
• Flagship assets include operated blocks in the Llanos Basin (LLA-34, Southern Llanos) and Putumayo Basin.
• Key projects involve near-field exploration at LLA-32 and development of heavy crude resources.
• The company recently formalized a strategic alliance with Ecopetrol covering the Llanos Foothills basin.