Good morning. On the call with me today are our President and Chief Executive Officer, Imad Mohsen; our Chief Financial Officer, Cam Grainger; and our Chief Operating Officer, Eric Furlan.

[Operator Instructions] As a reminder, this conference call includes forward-looking statements as well as non-GAAP and other financial measures with the associated risks outlined in our news release and MD&A, which can be found on our website or at sedarplus.ca. Note that all amounts discussed today are in U.S.

dollars unless otherwise stated. I'll now turn the call over to Imad.

Please go ahead.

Thank you, Mike, and good morning, everyone. Over the first half of 2026, Parex executed a series of strategic transactions that have positioned us to become Colombia's largest independent E&P company.

These transactions were designed to add complementary assets that enhance our scale, deepen our portfolio and strengthen the profitability and duration of our business for long-term growth. Starting with the Frontera transaction for $725 million, this $725 million acquisition adds roughly 37,000 barrels equivalent a day of highly accretive production with strong industrial logic and compelling synergies.

It materially increases our reserves inventory and strengthens long-term production visibility while being secured at an attractive valuation. Importantly, we are bringing in a deep bench of core technical talent and operational capabilities that will further strengthen our organization and enhance our ability to execute across the large asset base.

The transaction also supports more efficient capital allocation across the portfolio, enabling us to direct free cash flow from mature assets toward our highest return development and exploration opportunities. Secondly, the expanded partnership with Ecopetrol with Magdalena in the Magdalena Basin.

We have entered into an agreement with Ecopetrol that allows Parex to earn a 50% participating interest in the Casabe and Llanito blocks in Colombia's Magdalena Basin through $250 million gross capital investment commitment over 5 years with no upfront acquisition cost. The transaction further expands our strategic partnership with Ecopetrol and reinforces our long-standing collaboration in Colombia.

These mature fields currently produce approximately 15,000 barrels a day and offer significant long-term upside through enhanced oil recovery, waterflood optimization and development drilling initiatives. The transaction provides a proven operating base with clear path to incremental production growth, leveraging Parex's established track record of enhancing recovery through the application of proven technologies.

Upon completion of these strategic transactions, Parex is expected to become the largest independent Colombian-focused exploration and production company with average production of 82,000 to 91,000 BOE a day, nearly doubling corporate production, alongside a land position exceeding 7.9 million acres and significant long-life reserves. This expanded business provides a scale, inventory depth and financial capacity to drive superior long-term returns while enabling more disciplined allocation toward our highest return opportunities.

With that, I'll now turn it over to Eric to speak on our current operations. Eric, please go ahead.

Thanks, Imad. In the first quarter, production averaged just under 45,000 BOE per day.

While current production levels are below Q1 averages, we expect stand-alone production to improve throughout the remainder of the second quarter and exit at or above 45,000 BOE per day. This growth will be supported primarily in our Putumayo operations and the continued advancement of our exploration success at Block 111.

With the constructive commodity price environment, our base plan continues to advance, while select high-value opportunities are being accelerated on an opportunistic basis to enhance returns and free cash flow. Our operations in the Putumayo continue to progress with particular excitement around the Orito block, where our wells are demonstrating strong performance.

We nearly finished our multilateral pilot, which we expect to start testing in the coming weeks. In Block 111, Parex has drilled 6 exploration wells to date, with 4 delivering positive results across separate areas.

One well has already commenced initial production at approximately 1,500 barrels per day of oil. The remaining wells have shown encouraging indicators, including oil on logs, with testing expected to start in the coming days.

All 6 exploration wells were delivered on budget at approximately $2 million all in, including drilling, pad and mobilization, representing an approximate 65% reduction versus typical exploration well costs of around $6 million per well. This improvement was driven by a fast-moving rig and streamlined well and pad design, reflecting the strong execution and coordination of our teams.

With these results, Parex is advancing a multi-well development program across 3 fields with sustained production expected in late Q2 2026, up to 7 development and appraisal wells planned for the second half of this year. Based on the successful start of this campaign, we have identified over 15 prospects on existing seismic surveys.

We plan to continue building future runway with this trend with additional 3D seismic activity planned in the future and expect exploration-focused drilling in the eastern Llanos to recommence in 2027. While our stand-alone production base remains strong, the second half of the year represents a meaningful step change in scale as we consolidate the Frontera portfolio and start our work programs in the Magdalena Basin.

For the Frontera portfolio, in anticipation of closing, the company has initiated integration planning to ensure smooth transition. Following close of the transaction, Parex will review the acquired portfolio to optimize development and enhanced oil recovery opportunities while prioritizing safe, reliable operations.

The transaction is also expected to generate synergies in marketing and tax, among other areas, supporting enhanced efficiency and stronger long-term returns. For the new Magdalena assets, we're working towards completing initial activities to drill the first wells in the Casabe and Llanito programs.

A key near-term milestone is spudding the wells on each block as this is a contractual requirement to enter into production participation for each area. Lastly, we continue to progress our Foothills exploration program.

We are in the early stages of work in the Piedemonte prospect, with several work scheduled to commence this quarter in preparation for a fall 2026 spud. As a reminder, this is the type of exploration where we see game-changing potential and enhanced risk and reward profile.

While the start of 2026 has been more modest than anticipated, we remain confident in our trajectory, supported by a portfolio that is better positioned than ever to deliver high-quality inventory and multiple independent development and growth projects. With that, I'll turn it over to Cam.

Thanks, Eric. Our financial performance this quarter serves as a bridge toward the significantly larger cash-generating capacity of the transformed Parex business.

First quarter 2026 results were strong on an underlying basis despite the impact of nonrecurring items. Funds flow provided by operations, or FFO, totaled $114 million or $1.18 per share during the quarter.

Our Q1 results included a $17 million of onetime nonrecurring costs consisting of a $7 million temporary corporate wealth tax, a $7 million in site restoration costs, much of which we expect to recover through insurance and approximately $3 million in project-specific G&A expenses. Early in the second quarter, we made the tactical decision to unwind our hedge positions, a decision that has so far enhanced participation in the current commodity price environment.

The timing of our strategic transactions has been advantageous with commodity prices at current levels, enhancing the value of deals executed. Specifically, the January 1 effective date of the Frontera acquisition is expected to contribute a meaningful amount of incremental free cash flow, helping reduce the net consideration.

Another key financial milestone in the first half was the successful placement of $500 million of senior secured unsecured notes due in 2031. The 8.5% notes were priced at par and were strongly oversubscribed, reflecting strong support from the credit markets and confidence in our transformed Colombia-focused company.

Given the addition of debt to our otherwise simple balance sheet structure following the Frontera transaction, this financing is a logical step. Going forward, we expect to maintain a strong credit profile with high liquidity and a medium-term target net debt-to-EBITDA ratio of 0.5x or lower.

The second half 2026 guidance, which reflects the anticipated impact of both the Frontera acquisition and the Ecopetrol partnership transaction showcases the cash flow profile of the transformed business. Based on a $90 Brent assumption, we expect FFO netbacks of approximately $30 to $33 per BOE.

On a half year basis, FFO is expected to be between $475 million and $525 million and capital expenditures to range between $275 million and $295 million. Please note that the coming quarters are expected to include nonrecurring integration transition and financing costs, which may impact reported FFO numbers.

Looking ahead, our capital allocation priorities are clear. Parex is focused on optimizing capital allocation across its diversified portfolio, targeting 3% to 5% growth from base production, plus continuing to advance high-impact exploration opportunities with significant long-term potential.

This is while also maintaining a stable dividend and directing excess free cash flow primarily toward debt reduction. With that, I'll turn it back to Imad for closing remarks.

Thanks, Cam. To close, I want to reiterate the transformation that's underway at Parex and the scale of the opportunity.

Today's Parex is positioned to deliver a deep portfolio of development and exploration opportunities, generate substantial free cash flow, expand reserves and establish the company as one of the leading growth opportunities in the global oil and gas sector. Our path forward is centered on 5 priorities: optimizing the base business to maximize value, deliver reliable production growth and leverage proven technology; capturing integration synergies from our recent transactions and strengthening the overall scale of the portfolio; growing production through the execution of our Ecopetrol partnership in the Putumayo and Magdalena; advancing high-impact exploration in the Llanos Foothills, starting with the Piedemonte prospect this fall; and lastly, keeping a disciplined capital allocation framework while maintaining dividends and paying down debt.

We are confident this approach will create meaningful long-term value for shareholders and all stakeholders. Our partnership with Ecopetrol represents one of the company's most important strategic pillars going forward.

Today, the relationship is broader and stronger than ever, spanning from Capachos, Putumayo, Magdalena, Foothills and Quifa. Beyond expanding our operational footprint, these partnerships reflect a shared long-term commitment to Colombia and align Parex with one of the region's leading energy operators.

With respect to Frontera, I would like to sincerely thank Orlando, his management team, the Board of Directors and all employees for their hard work, professionalism and dedication in building Frontera into the company it is today. We are excited to welcome many new colleagues to Parex and are confident that the next chapter for the combined company will be a strong and successful one.

With increased scale, financial flexibility and portfolio depth, Parex is better positioned to deliver profitable growth and long-term value creation over time. As we move forward, I also want to thank our employees, partners, shareholders, Board of Directors and the communities where we operate for their continued trust, commitment and support.

The progress we are making is the result of the dedication and collaboration of many people. Before I conclude my remarks, I would like to recognize our Chairman, Wayne Foo, who is retiring from our Board of Directors.

Wayne has been instrumental in shaping Parex over the past 23 years as a founder and the former Chief Executive of both Petro Andina, Parex's predecessor and Parex Resources. Wayne established the foundation strategy and culture that have defined the company's success.

He has continued to guide Parex as the Chair of the Board since 2017. On behalf of the Board, management team, employees and shareholders, I want to thank Wayne for his exceptional leadership, vision and dedication.

His contributions have been instrumental in building Parex into what it is today, and his impact on the organization will be everlasting. We wish Wayne and his family all the very best in his retirement.

That concludes our formal remarks. I'll now turn the call back to the operator for questions from the investment community.

Can you hear me?

Yes.

Imad, congrats on these deals in particular. And thank you for the guidance for the second half of the year.

I'm just wondering if we can ask about looking out into 2027. I think Cam said something that, did you suggest we can expect 5% to 10% kind of annual growth going forward?

And is that relevant to 2027? And then on the CapEx side, looking into 2027, you have all this carry capital.

And obviously, it depends a lot on exploration activity, but is $0.5 billion or more of CapEx in 2027, a reasonable expectation?

So our long-term vision for the combined company is to have 3% to 5% base growth that we do basically using our normal EOR activities and near-field exploration appraisal with exposure to transformational upside that can be much higher than that. Now in our view, the CapEx really depends on the oil price.

So if I take the pro forma of Parex plus Frontera without the Magdalena assets at $70 environment, that was $500 million, yes. Now of course, oil price stay above $100, you have a little bit more flexibility and more opportunistic short payout projects.

You can add to that $500 million. Oil price goes below that, might go the other direction.

And there's some money that will go into Magdalena as well. So high level, we're not putting guidance out now, but I think the $0.5 billion number order of magnitude is a good start point.

And of course, as we get to know the assets in more detail and build our plans for next year, you'll get a more detailed guidance. Does that answer your question now, James?

Yes, that's very helpful. And then just an asset that is maybe not super material, but you have -- I think you're increased -- doubling your interest in the VIM-1 asset.

Is there still a plan there to ramp up gas production maybe in 2027?

Just before Eric answers on the plan, it is one of my favorite assets. I really love it.

Go ahead.

We just -- in VIM, so we just completed the La Belleza 3 well. That well is positioned to -- and it looks successful on logs, and we're about to test it.

That well was drilled to help sustain a longer-term blowdown period and also provide near-term higher liquids recovery. Over the next year, we are commencing a pipeline and expect to proceed to sales in -- from La Belleza.

So that plan has remained unchanged. We're also drilling another prospect currently.

We're moving the rig to drill an additional prospect on the block that is also expected to be a high liquids gas well in anticipation of the blowdown and the very strong market prices for gas in Colombia.

So just to give you an idea, like today's producing wells -- well, one well, is producing the equivalent of 30 million scfs a day with more than 3,000 barrels of liquid. So we're talking about 9,000 BOE or so for the combined company.

Correct. Yes.

Now if we -- once we drill that third well with additional certainty and we start to blowdown the well towards the market, getting the netback higher than netback on oil in my view or similar depending on the oil prices. So this is a real cash generator for next year and beyond as soon as the pipeline is ready.

So that's why even if that additional prospect doesn't pan out, we have a very good cash generation. And our plan is we're spending like $6 million a year on water handling and treatment.

So one of these wells could become a water injector if they don't produce and cut significantly that OpEx bill. So as an asset for both Frontera and Parex and the new Parex, I think this will be one of our big cash cows coming forward.

And with almost no decline.

Yes. It will be flat for a number of years.

Just to clarify in terms of start-up of that gas blowdown, it's probably more second half 2027 thing rather than first half?

Correct.

Do you know, firstly, invite people?

Thank you very much for joining the call today. If you have further questions, you can always reach out at Parex, and we'll be happy to help you.

Have a great day.