Parex Resources Inc. has entered into a definitive arrangement agreement to acquire Frontera Energy Corporation's upstream Colombian exploration and production business for total equity consideration of up to US$525 million (approximately C$712.6 million), comprising US$500 million (C$678.7 million) at closing and a US$25 million (C$33.9 million) contingent payment tied to the extension of the Quifa Association Contract. Parex will also assume US$310 million (C$420.8 million) in senior unsecured notes and a US$80 million (C$108.6 million) Chevron prepayment facility, bringing firm value to approximately US$750 million (C$1.02 billion).

The transaction supersedes a prior arrangement with GeoPark Limited, with Parex's offer representing a US$125 million (C$169.7 million) increase in equity consideration — a 31% premium. Frontera terminated the GeoPark agreement and paid a US$25 million break fee. The deal, expected to close in Q2 2026, requires approval by at least two-thirds of Frontera shareholder votes and is subject to British Columbia Supreme Court and regulatory approvals.

Following completion, Frontera intends to distribute approximately US$470 million (C$638.0 million), or roughly CAD$9.18 per share, to shareholders and will transition into a pure-play infrastructure company. Citi served as financial advisor and BMO Nesbitt Burns provided a fairness opinion to Frontera. Blake, Cassels & Graydon LLP and McMillan LLP acted as legal counsel to Frontera, while Norton Rose Fulbright Canada LLP, Paul, Weiss, Rifkind, Wharton & Garrison LLP, and Brigard & Urrutia S.A.S. served as legal advisors to Parex. Scotiabank acted as Parex's financial advisor.