FRONTERA TO ESTABLISH TWO INDEPENDENT COMPANIES:
FRONTERA E&P AND FRONTERA INFRASTRUCTURE
Frontera Energy Corporation has announced a plan to unlock significant value from its existing assets through a spin-off of its Colombian Infrastructure business, creating two independent companies: Frontera Exploration & Production and Frontera Infrastructure. The Proposed Transaction is projected to be completed in the first half of 2026 and is subject to shareholder approval. All financial amounts in this news release and in the Company's financial disclosures are in United States dollars, unless otherwise stated.
Orlando Cabrales Segovia, Chief Executive Officer (CEO), Frontera, commented:
'Over time, Frontera has consistently attracted interest from investors and strategic parties who recognize the distinct strengths and value propositions of the upstream oil and gas and infrastructure businesses. While the upstream oil and gas and infrastructure businesses are complementary, each has distinct operational profiles and life cycles, appealing to different investor bases.
To further unlock shareholder value and pursue future consolidation opportunities, the Company is announcing its intention to spin off its Colombian Infrastructure business. This strategic separation will result in two focused, independent companies, each with clear priorities and tailored strategies.
The Company believes the business separation represents a significant opportunity to surface and distribute value to shareholders, not currently reflected in Frontera's market capitalization. The separation, targeted to be completed during the first half of 2026, remains subject to shareholder and regulatory approval'
The planned separation aims to establish two strategically focused, independent companies:
- Frontera E&P will become a pure-play upstream oil and gas exploration and production company, focused on disciplined cash flow generation and operational excellence. For the last twelve months ended September 30, 2025, Frontera E&P had approximately $336 million of Operating EBITDA(1) and net leverage(2) of 0.7x times.
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(1) |
This is a Non-IFRS financial measure (equivalent to a "non-GAAP financial measure", as defined in NI 52-112). Refer to the Advisories section of this Press Release for further details. |
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(2) |
This is a Non-IFRS financial measure (equivalent to a "non-GAAP financial measure", as defined in NI 52-112). Refer to the Advisories section of this Press Release for further details. |
- Frontera Infrastructure will emerge as a leading energy infrastructure business, leveraging robust cash flows from ODL and aiming to invest in near-term strategic projects at Puerto Bahia to deliver a growing and long-term revenue and cash flow stream. For the last twelve months ended September 30, 2025, Frontera Infrastructure had approximately $16.2 million of Operating EBITDA and $117.4 million of Infrastructure Adjusted EBITDA(3) and net debt to Infrastructure Distributable Cash Flow (Puerto Bahia Operating EBITDA + Dividends received from ODL) of 2.0x times.
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(3) |
This is a Non-IFRS financial measure (equivalent to a "non-GAAP financial measure", as defined in NI 52-112). Refer to the Advisories section of this Press Release for further details. |
This transaction is consistent with the Company's commitment to unlock shareholder value and shall enable the companies to pursue future consolidation opportunities.
About Frontera's Infrastructure Business
Frontera's Infrastructure Colombia business includes the Company's 35% equity interest in the Oleoducto de los Llanos Orientales S.A. ("ODL") crude oil pipeline, through Frontera's wholly owned subsidiary, FPI, and the Company's 99.97% equity interest in Sociedad Portuaria Puerto Bahia ("Puerto Bahia"). The business combines an attractive growth profile and is backed by a steady dividend stream from its investment in ODL, which has received over $147 million in dividends and capital distributions since 2023.
About ODL
ODL is a midstream infrastructure business with a 260-kilometer onshore pipeline co-owned by Frontera's subsidiary, FPI (35%) and Cenit Transporte y Logistica de Hidrocarburos SAS (65%) which connects Colombia's largest oil-producing fields in the Llanos region with the Ocensa pipeline. Key customers include EcoPetrol, Frontera, GeoPark, Parex, and Hocol. In the last twelve months ODL transported approximately 238,000 barrels of oil per day, or 30% of Colombia's total daily oil production. Over the last twelve months ODL generated EBITDA of $289 million and paid approximately $170 million ($59.4 million, net to Frontera Infrastructure) in dividends and capital distribution to its shareholders.
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Source: Frontera Energy
