All right. Good morning, everyone, and thank you for joining us, and welcome to the Annual General and Special Meeting of the common shareholders of Parex Resources Inc. The meeting will now come to order. My name is Wayne Fu, and I'm the Board Chair of Parex. With the approval of the meeting, I will also act as Chair of the meeting.
This year's meeting is being held in a hybrid format to allow registered shareholders and duly appointed proxy holders to attend the meeting in person or virtually through the Computershare virtual shareholder meeting platform. Registered shareholders and duly appointed proxy holders attending virtually will be able to vote and submit questions and comments to the Computershare moderator to be read and addressed at the meeting. If you have a question or comment, please submit it through the Computershare virtual platform.
Questions directly related to the motions before the meeting may be addressed during the meeting. All other questions will only be addressed during the question period at the end of the meeting. I would now like to introduce the other directors of Parex Resources Inc. that have joined us in person here today. I would ask that each director stand when their name is called. Lynn Azar. Lisa Colnett. Sig Cornelius. Robert J. Engbloom. G.R. (Bob) MacDougall.
Glenn McNamara. Imad Mohsen. Carmen Sylvain and Paul Wright. I'd like to take this opportunity to acknowledge that Mr. Wright, who was not able to attend in person today, chose not to stand for reelection this year. It's been a pleasure working with Paul, and we greatly appreciate all of his contributions and insight on the board. I'd also like to introduce the executives of Parex Resources Inc. in attendance today. Imad Mohsen, President and Chief Executive Officer.
Daniel Ferreiro, President and Country Manager of Parex Colombia, is with us today from Bogotá. Mike Kruchten, Senior Vice President, Capital Markets and Corporate Planning. Ryan Fowler, Senior Vice President, Exploration. Josh Share, Senior Vice President, Corporate Services. Attending the meeting virtually today, I'd also like to acknowledge Eric Furlan, Chief Operating Officer, and Katie Bernard, Vice President of New Ventures.
Lastly, I'd like to acknowledge Ken Pinsky, our Chief Financial Officer and Corporate Secretary since inception of Parex Resources. Ken has elected to take retirement as noted in the press release. It's been a true pleasure on this journey to our now 14th AGM with Parex. I wish him well in his future endeavors. I hope he doesn't forget my number when he needs a fourth.
I'll ask Bruce Alford to act as Secretary of the meeting and Donald Santini of Computershare Trust Company of Canada to act as Scrutineer of the meeting. In order that the meeting covers all of the business for which it was convened within a reasonable period of time, we have prearranged with certain people to move and second certain resolutions.
This procedure is not an attempt to discourage participation, but merely a way to expedite proceedings. At the conclusion of the formal business of the meeting, I will pause to address any questions that may have been submitted through the virtual portal, specifically related to matters of the AGM. Following that, I'll call upon Mr. Mohsen to provide a business update. And finally, Mr. Kruchten will conduct a Q&A session.
We've previously mailed to shareholders the meeting materials and the financial statements of the company for the year ended December 31st, 2022, and the auditors report thereon. I direct that copies of the documents mailed to shareholders, along with the confirmation of mailing of such documents provided by Computershare, be kept by the Secretary with the minutes of the meeting.
Further, the reading of the notice of the meeting has been dispensed with. Pursuant to the bylaws of the company, business may be transacted at this meeting, if not less than two holders are present, owning or representing by proxy 25% of the shares entitled to be voted at the meeting. The scrutineer's report has now been received, and it shows that there is a quorum of shareholders present at the meeting.
I declare that the meeting is regularly called and properly constituted for the transaction of business. We will conduct each vote by way of in-person ballot and by way of vote cast on the Computershare virtual platform. I understand that the scrutineers have tabulated all the votes received prior to the voting cutoff. Thank you to our shareholders who have voted in advance.
If you've previously voted, you do not need to vote again. By voting again, you would revoke any previous vote made prior to the voting cutoff. I will now ask Computershare to open the balloting for registered shareholders and duly appointed proxy holders voting on the Computershare virtual platform for all of the resolutions. The polls are now open.
At this point, all registered shareholders and duly appointed proxy holders attending the meeting virtually that have properly logged in with their control numbers or username and who wish to vote will be able to see on the screen all motions being brought forth at this meeting. These include a motion to terminate the meeting, which will be enacted after the announcement of the voting results on the matters considered at the meeting.
Please register your votes by selecting the for, against, or withheld buttons as applicable next to each of the resolutions. If you're attending the meeting in person, you should have completed your ballot when you entered the meeting. If you have not yet submitted your ballot, please provide it to the scrutineers now. Particulars of the votes cast on all matters may be obtained from the secretary after the meeting.
I direct that the scrutineers report on all matters be annexed to the minutes of the meeting as a schedule. The first item of business is the presentation to shareholders of the financial statements of the company for the fiscal year ended December 31st, 2022, and the auditor's report thereon. A copy of the financial statements have been mailed to each registered shareholder, with a copy also located on the Computershare dashboard page. The next item of business is to fix the number of directors to be elected at the meeting. I move that the number of directors to be elected at the meeting be fixed at nine directors.
I second the motion.
Thank you. Are there any questions from any registered shareholders or proxy holders? The next item of business is the election of directors.
I nominate Lynn Azar, Lisa Colnett, Sigmund Cornelius, Robert Engbloom, Wayne Fu, G.R. Bob MacDougall, Glenn McNamara, Imad Mohsen, and Carmen Sylvain as directors of the company to hold no office until the next annual election of directors or until their successors are elected or appointed, subject to the provisions of the Business Corporations Act and the bylaws of the company.
I second the motion.
Are there any questions from any registered shareholders or proxy holders regarding that motion? The next item of business is the appointment of auditors.
I move that PricewaterhouseCoopers LLP, chartered professional accountants, be appointed auditors of the company until the next annual meeting or until their successors are appointed, and that their remuneration as such be fixed by the board of directors.
I second the motion.
Are there any questions from any registered shareholders or proxy holders on that motion? The next item of business is to approve all unallocated options issuable under the company's stock option plan for a 3-year period.
Mr. Chairman, I move that the ordinary resolution, as set forth on page 23 in the information circular dated April 3rd, 2023, approving all unallocated options issuable under the company's stock option plan for a 3-year period be approved.
I second the motion.
Thank you. Are there any questions from any registered shareholders or proxy holders regarding that motion? The next item of business is an advisory, non-binding resolution on the company's approach to executive compensation described in the information circular of the company dated April third, 2023. Say on pay is not a requirement in Canada, but the Parex board of directors has made the decision to voluntarily put our compensation practices to a non-binding vote again this year.
I move that on an advisory basis and not to diminish the role and responsibilities of the board of directors of Parex, shareholders accept the company's approach to executive compensation as disclosed in the statement of executive compensation section in the management information circular of the company dated April third, 2023.
I second the motion.
Are there any questions from any registered shareholders or proxy holders? The final item of business is to arrange for the termination of the formal portion of the meeting following the announcement of voting results on the matters considered at the meeting. May I have a motion that the formal portion of the meeting be terminated following the announcement of the voting results on the matters to be considered at the meeting.
Mr. Chair, I make that motion.
I second the motion.
Thank you. As voting has been previously enabled for all motions on the Computershare virtual platform, if a shareholder attending virtually has not yet voted, please do so now. If you're attending the meeting in person, you should have completed your ballot when you entered the meeting. If you have not yet submitted your ballot, please provide it to the scrutineers now. I will pause briefly to allow final voting. Voting is now closed.
The voting page on the Computershare virtual platform will now disappear, and your votes will automatically be submitted. I will now pause to receive voting confirmation from the scrutineers. I've been advised by the scrutineers that all resolutions have been approved by more than the requisite majority. Therefore, I declare all resolutions carried. Particulars of the votes cast on each matter may be obtained from the secretary of the meeting.
I direct that the results of the poll and the scrutineers report be included with the minutes of this meeting. The results on the appointment of directors will be press released in accordance with the policies of the TSX, and the results on all of the matters considered at this meeting will be disclosed in a report filed on Parex profile on SEDAR. I will now pause and address questions related to the matters of the AGM that have been submitted, if any.
There are none.
Thank you. In adherence to the approved termination motion, I declare the meeting terminated. With the formal portion of the meeting complete, I would now like to invite Mr. Mohsen to provide our business update, which will be followed by time for any questions you may have. There you go.
Thank you very much. Good morning, everyone. I'd like to thank you all for attending, both in person and online. It's nice to see you all. It's probably My first AGM in person, in fact, so great having you. My name is Imad Mohsen, and I am Parex' CEO. This morning, I'm pleased to provide you with an update on our growth strategy in Colombia and then take questions.
Before I start my presentation, I wanna take a moment to echo Wayne's comments about Paul and Ken. After 14 years of service, Paul is ending his time on the board. I wanna thank him for his professionalism, wisdom, and fantastic service. Yesterday, Ken announced his retirement, which will take effect in Q4 this year.
Ken has been the pioneer in the Canadian oil and gas sector in terms of debt-free strategy and return of capital. He has always been an advocate for the shareholder and has successfully led Parex through high and low oil prices while keeping a measured approach. While he's not gone yet, I do wanna take this opportunity to formally thank Ken.
Thank you for his service, as this will be his last AGM. Over the last 2 years, we have put our Colombia-focused strategy into motion, taking decisive steps to become the country's largest independent oil and gas producer with increased operatorship. We have expanded our portfolio in terms of product type and land position, created a pipeline of projects by growing our resource base and investing in proven technology to ensure sustainable growth.
We continue to deliver exceptional shareholder return, including expanding our returns with introduction of regular dividends. These actions have enabled our transition from primarily a single asset company to a Colombia-wide operator and positioned us for growth, both in terms of production and, more importantly, value. In December, we had a capital markets day. We reiterated our Colombia-focused strategy.
The question is, why Colombia? Put simply, we see it as the preferred jurisdiction to invest in, with a robust risk-reward profile. That's based on substantial resource potential, high net back environment that has underdeveloped basins, established industry with substantial underutilized infrastructure, and stable operating environment. Colombia is an OECD member. It respects contracts and is very committed to the free movement of capital. To me, I see Colombia as that forgotten hydrocarbon El Dorado paradise.
It's been exploited not nearly as much as other onshore basins. It reminds me of North America or Europe 50 years ago, and this creates a unique opportunity for PERC to bring industry-proven technology from elsewhere and further harvest its resources. How does that translate in real life? You can see on this graph that our commitment to Colombia has translated both in a strong track record with successful history of growing production and reserves on both an absolute and per share basis year after year.
Now, this combination of growing the production and reducing the share count has enabled PERC to improve our funds flow. You can see that throughout multiple commodity price scenarios and changing regimes, what kind of trend we managed to deliver here. All of this has resulted in a greater than 1/3 reduction in outstanding shares. Thank you, Ken.
Introduction of a sustainable and growing dividend. To date, more than CAD 1.3 billion have been returned to shareholders since 2017. One approach working with community sets us apart as the preferred operator in Colombia. It represents a competitive advantage that enables our success. I'd like to share with you that when I was interviewing to join Parex, the attitude of Parex's company with a heart was, for me, a huge differentiator.
It made the difference. This is a company that really cares, from the employees to the top of the board. By working collaboratively, we have successfully generated shared benefits with local communities. This helped create a solid symbiotic relationship with the host communities and does enable operational continuity for our company in the most difficult parts of Colombia.
In particular, I'm proud of ESG initiatives, some of which include Cabecera Solar Farm. Not only does this solar farm add energy to the grid, but in line with Parex's philosophy on investing in a greener future, it makes business sense. It save us money even compared to electricity from the grid, and it powers our facility. There's Plan Padrino, and that relates to my comment about the company that cares.
This is driven by the employees, and they help build houses for underprivileged community members, changing their life. To date, we've built 17 homes, improving the lives of 17 families. In fact, drastically changing it. Water for All, and this program is focused on building infrastructure to enable access to clean water for communities in Colombia. Since 2017, we helped over 30,000 people gain access to clean water.
This translates in being recognized externally for our ESG efforts. As an example, in April, MSCI reconfirmed our AA rating. To put it in perspective, this is the same rating as one key investor told me that Royal Bank of Canada has, a reputable Big Six financial institution. This is not an easy feat to achieve for an oil and gas company. Our track record for success, both on above ground, makes me confident in our ability to profitably grow the business moving forward.
We are doing that by focusing on three pillars. First, exploitation through technology. Colombia oil and gas industry has not historically fully embraced proven technology used elsewhere in the industry. Parex is actively changing that narrative. We are going after onshore. Our exploration portfolio has transformational potential, and it is a competitive advantage for Parex that doesn't exist with traditional unconventional players.
Our growth strategy culminates in minimized decline rates, lower maintenance capital, and greater capital efficiency. One thing is strategy, and of course, there's delivery. By acquiring high-quality land, equipment, technology, and most importantly, highly skilled people in a counter-cyclical market. Notably, in 2021, we increased our land base fourfold, making us the largest landowner in Colombia.
The benefits of high-grading our portfolio and expanding our target base translates into scalability of our investment in technology and also our exploration efforts. Last year, we shared this 3 years plan, and I'd like to emphasize that the trend continues for years to come beyond the 3 years. The plan projects production growth of 15% this year, in 2023, and 5% in 24 and 25 and beyond.
That excludes any benefits of exploration success, which are, we're counting on, by the way. This plan also increases capital efficiency through technology and infrastructure elements. I wanna point out the yellow line here. That represents our capital. As you can see, we are now at extremely important inflection point. In 20 and 2021, we invested heavily. We built the foundation by investing in waterflood to minimize the decline rate, reducing maintenance capital.
We invested a lot in infrastructure to open up areas with significantly higher capital efficiency than just mere infill in older wells, older fields. We also paid M&A costs, carry costs, which basically runs through our plan and ends in 2024. All this culminates in increased production while reducing capital, total capital going forward. Production goes up, capital goes down, and the time is now.
The combination of our efforts has resulted in increased production at lower capital costs and increased free cash flow, all while reducing the share count. This delivers exponential growth to the shareholder on a per-share basis and available free cash flow, as you see in the last table. As I mentioned earlier, our 3-year plan doesn't take credit for the exploration successes that we better deliver. While accounting for approximately $50 million spent per year.
Colombia is unique. Because of the civil strife, it we have world-class targets left behind. They've been untouched for decades, and this puts us in a very privileged position to target prospects that normally only are available to the majors offshore, deep water, and they are at our doorsteps now. As a result, our exploration portfolio has the potential to create step change growth for the company.
With more than 15 high impact prospects that are targeting more than 20,000 barrels a day of production potential. Our ability to drill a catalyst, well, every 3, 4 months, is a unique proposition. This differentiates us compared to unconventional North American producers that don't have that possibility to change overnight.
To wrap up, we have a strong record of success, both above and below ground in Colombia. Over the last 2 years, we have taken measured steps to progress our strategy, which has brought us to an inflection point. This is very historical time for Parex. As a result, we are now better positioned than ever to harvest the full value of our world-class portfolio.
Our main focuses are cementing our ESG leadership performance, making technology and infrastructure investments to lower decline rates and enable improved capital efficiency, targeting some of the world's best exploration opportunities that are typically only available to majors offshore deep water, and continuing to deliver exceptional shareholder returns.
Parex has been creating foundations for profitable, sustainable growth. We have the right people, technologies, and expertise to drive long-term success for all our stakeholders. With that, I'd like to end by thanking the board, shareholders, and our employees, many of whom are here today.
Thank you, IMad. Are there any questions from in-person? We do not have any questions online. With that, we will conclude the business update portion of the AGM. Thank you very much for coming, and we'll be here to talk to you and, welcome you aboard Parex. Thank you very much.