06:32 AM EDT, 03/11/2026 (MT Newswires) -- Frontera Energy ( FECCF ) late on Tuesday said it has agreed to sell its upstream Colombian exploration and production business to Parex Resources ( PARXF ) for an equity consideration of up to US$525 million.

The consideration includes $500 million payable upon closing and a $25 million contingent payment payable upon execution of the contractual amendment, or other binding agreement, extending the term of the Quifa Association Contract within 12 months.

Parex will also assume all of Frontera's obligations under its $310 million 2028 senior unsecured notes and $80 million Chevron prepayment facility, resulting in a firm value of about $750 million.

The deal follows Parex's submission of a proposal providing for an additional $125 million in equity consideration, representing a 31% premium to the consideration under Frontera's agreement with GeoPark to acquire the same assets.

Upon entering into the deal with Parex, Frontera terminated the GeoPark agreement and paid a $25 million purchaser break fee.

The equity consideration of $525 million implies a stock price of C$13.18, which represents a premium for shareholders in excess of 112% to the 90-day volume weighted average price of Frontera's common shares on the Toronto Stock Exchange before the Geopark deal announcement.

At deal closing and subject to shareholder approval, Frontera plans to distribute to shareholders about $470 million, or an estimated C$9.18 per share, which includes the $25 million contingent payment.

Upon deal closing, Frontera will emerge as a newly focused infrastructure company, anchored by its standalone portfolio of infrastructure assets.

These assets include a 35% equity interest in the Oleoducto de los Llanos Orientales crude oil pipeline and a 99.97% equity interest in Sociedad Portuaria Puerto Bahia, as well as certain non-Colombian assets, including the company's interests in Guyana.