Wayne Foo - President and CEO Dave Taylor - EVP of Exploration and Business Development Ken Pinsky - CFO

Rohin Patel - Haywood Securities Nathan Piper - RBC Capital Markets Gavin Wylie - Scotia Bank Jamie Somerville - TD Securities Ian Macqueen - Paradigm Capital

Thank you operator and thank you all for joining us this morning. With me today is Dave Taylor, our Executive VP of Exploration and Business Development, Ken Pinsky, our Chief Financial Officer, Mike Kruchten, our VP of Corporate Planning and Investor Relations and Barry Larson, our Chief Operating Officer is joining us using Skype from our Vegas office.

Before we begin, I’d like to mention that this call is being recorded as it will be available for playback on the company’s website at www.parexresources.com. I’d also like to remind you that all of the company’s continuous disclosure documents maybe found on SEDAR or on the company’s website, these documents provide more complete information than what may be discussed during the call this morning.

Any remarks made by management during this call may contain forward looking statements that are based on the expectations, current beliefs, and assumptions of management regarding the company’s future growth, results of operations, production, future capital, other expenditures, plans for and results of drilling activity, environmental matters, business prospects, opportunities, and transactions. Forward looking statements involve significant known and unknown risks and uncertainties which are fully disclosed in the company’s disclosure documents as previously mentioned.

The information discussed today is made as of today’s date and time, and the company assumes no obligation to update or revise this information to reflect new events or circumstances except as required by law. Yesterday we released our 2015 guidance and on Tuesday we released our unaudited financial and operating results for the quarter ended September 30, 2014, copies of the two press releases and company’s consolidated financial statements and the related management’s discussion and analysis or MD&A are available under the company’s profile at www.sedar.com and on the company’s website at www.parexresources.com.

The format for today’s conference call will be a question and an answer session with our audience. First we will take questions from the audio conference and then questions from the webcast.

Operator over to you.

Hi this is Rohin Patel from Haywood Securities. I had two questions here.

First off, giving the strong testing results you had in Q3 that your production to 26,000 October, any emphasis on drilling these blocks in 2015? Can we expect to see these results in a significant increase with 3P reserve based in the year end 2014 reserve report or will this reflect more of a transition from 3P to 2P reserves.

We adhere very closely to the Canadian standards for reserve disclosure NI 501101 and we don’t comment on reserves until such time it's been reviewed by an outside auditor. I think the review of test results, the description individual wells and the way that we hit those into the context of prospects management has an internal view that we can’t really and we will not speculate on how that will come out in terms of reserves at year end.

Sure okay no problem thanks. Secondly just as a follow up to that, you mentioned 16 development wells in 2015 to keep production flat at 26,000.

Of those remaining 23 exploration wells, how many of those wells have you guys allocated essentially zero risk production to? In other words, how many of those explorations wells are expected to contribute that 30% production growth?

Yes it’s Dave Taylor. We usually budget about one in three success rate.

So six wells we would anticipate coming on staggered over the year of course to selling that wedge. We’ve also allocated six follow up appraisal wells on the budget for exploration success.

Thanks good morning guys. So a couple quick ones from on the nature fields that you are financing here in Colombia and Tijuana and Tua, are there any regulatory or approvals that may constrain or limit your production growth there or is it just a case of those in the facilities (inaudible).

I guess what paper work do you need to put in place as well as facilities to grow production there?

Hi Nate this is Ken. We are not aware of any regulatory or permitting issues that are outside the normal course of business there.

Facilities are being built as we kind of stand here and we understand the operator is on track with the budget.

Okay so you don’t need to find a field, you can continue, you don't have to extract development area or anything like that. You can just continue growing production as you're drilling success allows you to.

Yes there are several different processes that are involved as we move forward, appraisal areas, development areas, declaration and commerciality that are all laid out in the contract and we just follow those through as for all the rest on the fields we have in Colombia. The operator of course in this case is the one responsible for doing that and he is on top of that.

Hey guys two quick questions just on the drilling program. First one was recognizing that the dry season is where the bulk of your program will be spent.

How many wells on the exploration and sort of new concept side do you plan on drilling in that first half of the year? And second question is, what do you see is a reasonable timing for the first well on Capachos and would it be kind of a one-two combined drilling program?

So you’re just using the same rigs get it over or mobilize it to the next site and get those done right away or is there a lag time that you present in there?

So it’s Dave again Gavin. In the first half of the year we would anticipate of those 17 or 18 explorations wells if you include the New Play Concept well.

We’ll be looking at probably 13 or so of those being drill in the first half in the dry season and that’s fairly normal for us, this year’s activity was quite similar. We drilled a lot less wells in the second half.

Sorry I missed your second question.

Just on Capachos, in terms of the timing of the wells there, the first well. And is it kind of going to be one, two sort of schedule where you just drill back to back or is there a lag that somehow pops up in there based on regulatory?

Yes we will like to drill them back to back, the issue we have there is we’re waiting on the (convene) [ph] to be approved and then we can get going where we’re planning to start first quarter but that is contingent on getting that document signed. That's really between the operator and the NAH.

Hi guys good morning, similar questions, just dig in for more detail, is the new Play Concept well likely to be a second half well?

Which one sorry?

The New Play Concept.

Yes, yes that's going to be in third quarter.

Okay and any chance you could actually say what the four blocks are, where you plan to drill where you haven’t drilled for?

The VMM 11, Capachos and [indiscernible].

So just to clarify El Porton would be included in this year’s program then?

I'll need to get that well spud this year that’s correct. Whether we get it down or not just both depend on timing.

Yes almost 26 would be included in this year’s program as well.

Well we are going to get it spud hopefully this year, it could be drilling through year end.

I just have one further clarification on the guidance. You’re still excluding any gas production is that correct?

Yes that’s correct.

Can you clarify what your actual gas production, and I know you are not disclosing it because you are not generating sales revenue from it. But can you disclose what it is and whether you see any potential for a significant increase in gas production next year?

Its currently about a couple of million a day and we use that primarily as we’ve told you in the [indiscernible] fuel as replacement for diesel for operating cost particularly at Kona and I think it's up at [indiscernible] now. And going forward we have gas reserves on block 32, we haven’t got them booked but we have tested gas as we're opening a couple of wells.

And we’re looking at using that gas again for field optimization with respect to switching out of diesel for pumps and using the gas and we’ll look at doing that. That will be a study that we’ll do here in 2015.

Good morning guys just a quick question on your capital program. With 16 development wells, the difference between 16 development wells and what's booked as far as what GLJ thought was based on a 47 1P, 78 2P and 99 3P.

Do you think your recovery factor is going to be better than what GLJ is recognizing, like 16 sounds like a relatively low number relative to what’s booked? Can you comment on your view on what the recovery in those well would be versus what GLJ sees or can we just think that you’re drilling only 16 of your 78 2P locations?

I’ll take your number three, as I said earlier in the question about yearend reserves, we do our internal studies. We have a view about performance that we’re not going to compare to the original reserve report.

I think if you look at the larger edge water drive fields that we’ve had Las Maracas has performed very well and we've seen revisions upward on that as we’ve gone long. And our hope is always that the reserves that have been disclosed will be produced and that we’ll have room to grow them but at this point we’re budgeting them as we see them in the reserve report.

We just see a question up on the board here, about the ultimate potential of block 34, 32 and what kind of production growth we’re expecting going forward and when do we expect to plateau. I think we partially answered that question vaguely with Wayne's response in that we have numerous 2P locations remaining on our existing fields on block 32 and 34.

We’ll be managing and drilling those as per our capital allocation. And then on oil prices obviously it will take some of the pace of that development built and the potential hasn’t been fully realized yet.

We have a number of exploration prospects to drill on those blocks. And those are budgeted in this year's program.

We have only ordered six exploration prospects to drill on those block in 2015, three on block 32 and three on block 34. At this time there is further exploratory opportunities as well that we haven't budgeted for this year.

We can certainly accelerate some of that exploration drilling if we saw an increase in oil prices but at current price levels and budget levels and living within our cash flow that’s what we see.

Operator I think that was the last question on the website.