Sterling Resources (SLG-V) Gran Tierra Energy (GTE-T) now holds 246.1 million shares or 45.77 per cent of Sterling. As well, Gran Tierra's president and chief executive officer, Mr. Guidry, has joined Sterling's board. Gran Tierra had not conducted any work in Peru since 2015, when Mr. Guidry joined the company. He directed Gran Tierra's focus to Colombia. As for Sterling, it looks forward to beginning production in Peru in the fourth quarter of 2018.
Before turning its attention to Peru, Sterling was a natural gas explorer in the British and Dutch North Sea. It peaked at $4.94 in 2011, but five years later the stock was down to three cents. Sterling then rolled back 1 for 100 in 2016, but this did not help its share price. In March, 2017, with the stock trading around 90 cents, Sterling decided to sell itself to a Dutch company called Oranje-Nassau Energie for $97-million (U.S.) cash and the assumption of $16.8-million (U.S.) worth of debt. Sterling closed the sale in May, then in June it paid a cash distribution of 63 U.S. cents a share. It was then ready to delist, but along came Manolo Zuniga, a Peruvian petroleum engineer with ambitions for an entity called PetroTal. Mr. Zuniga arranged for his PetroTal to merge with Sterling, while Sterling acquired Gran Tierra's Peruvian assets. For its part, PetroTal's main contribution (aside from Mr. Zuniga) was cash. In December, it sold $34-million (U.S.) worth of subscription receipts at $1 (U.S.). Each receipt converted into 5.35 Sterling shares, resulting in an effective price of 18.69 U.S. cents a share. The investors in that financing are up today. Mr. Zuniga is now Sterling's CEO with a salary of $315,000 (U.S.). His previous company, BPZ Resources, an oil and gas explorer in Peru and Ecuador, went bankrupt in 2015.
Sterling's Peruvian assets include block 95 (Bretana), block 107 (Osheki) and block 133 (no name yet). It is Bretana that Sterling hopes to bring to production before year-end. The company plans to spend $30.6-million this year, including $24-million (U.S.) on Bretana and $600,000 on Osheki. Sterling aims for Bretana to be producing 5,000 barrels of oil a day in the first half of 2019. As for Osheki, the company plans to seek a joint venturer. Sterling proposes to change its name to PetroTal Corp. It is also mulling a rollback. It has 537.74 million shares issued. |
