Hello, and welcome to the annual meeting of stockholders of Gran Tierra Energy Incorporated. Please note that today's meeting is being recorded. Today's discussion may include certain forward-looking information, oil and gas information, and non-GAAP financial measures. Please refer to the earnings and operational update press release we issued yesterday for important advisories and disclaimers with regard to the information and for reconciliations of any non-GAAP measures discussed in today's AGM. Finally, this AGM is the property of Gran Tierra Energy. Any copying or rebroadcasting of this webcast is expressly forbidden without the written consent of Gran Tierra Energy. It is now my pleasure to turn today's meeting over to Mr. Robert Hodgins, Chairman of the Board of Directors of Gran Tierra Energy Incorporated. Mr. Hodgins, the floor is yours.
Thank you very much. Good morning, ladies and gentlemen, and welcome to the 2024 Annual Meeting of Stockholders of Gran Tierra Energy Inc., which is being held by webcast. My name is Robert Hodgins, and I'm Chairman of the Board of Directors of Gran Tierra Energy Inc., and will act as chairman of the 2024 Annual Meeting of Stockholders of Gran Tierra Energy Inc. I'm pleased to have you join this webcast, and I wanna open by thanking Gran Tierra's board of directors who are joining us as well today, and to thank members of Gran Tierra management who have joined us as well. Phillip Abraham, our corporate secretary, will act as secretary for this meeting. It's 10:01 A.M., and the meeting will now officially come to order.
We will proceed with the formal business of the meeting as set forth in your notice of annual meeting and proxy statement. If you need a copy of the annual report or of the proxy statement, the links are provided online. The agenda and rules of conduct have been provided on the virtual meeting website and outline how we will proceed with today's meeting. As stated in the rules of conduct, if you would like to submit a question, you may do so by following the instructions on the meeting website. We ask that you limit yourself to two questions or comments and restrict your questions to matters of general interest to our stockholders. Thank you for your cooperation with these rules. Will the secretary please report at this time with respect to the record date, stockholders list, and the mailing of the notice of the annual meeting?
Thank you. We have received an affidavit signed by Odyssey Trust Company that notice of this meeting, along with related proxy and annual report materials, was mailed or made available on March 21, 2024 to Gran Tierra stockholders of record as of the close of business on March 6, 2024, our record date. A list of stockholders as of the record date is available for inspection by verified stockholders upon emailing info@grantierra.com.
At this time, I'd like to confirm that Gloria Gerasim of Odyssey Trust Company will act as the inspector, Inspector of Election at this meeting. She has taken and subscribed the customary oath of office to execute the duties of inspector of election with strict impartiality. The function of the Inspector of Election is to decide upon the qualification of voters, accept their votes, and when balloting on all matters is completed, to tally the final votes. The polls are open. If you have not voted or wish to change your vote, you may do so now by clicking on the link provided online. Stockholders who have already voted and do not want to change their vote do not need to take any further action. Will the secretary please report at this time with respect to the existence of a quorum?
We have been informed by the Inspector of Election that proxies have been received for 16,961,619 shares of the outstanding shares of Gran Tierra Energy Inc. common stock. Collectively, the votes for which these proxies were received represent approximately 52.49% of the total number of votes that may be cast by the outstanding shares. This constitutes a quorum for the meeting today.
We will now proceed with the formal business of the meeting. There are three proposals to be considered by the stockholders at this meeting, which are summarized and more fully described in the proxy statement for this meeting, which has been filed with the Securities and Exchange Commission and mailed or made available to stockholders. The first item of business is the election of nine directors to serve until the 2025 annual meeting of the stockholders and until their successors are elected and qualified. This proposal is described in detail in the notice and proxy statement delivered to stockholders in connection with this meeting. The nominees for directors are Peter Dey, Gary Guidry, Evan Hazell, Robert Hodgins, Alison Redford, Ronald Royal, Sondra Scott, David Smith, and Brooke Wade.
The second item of business is the ratification of the selection by the Audit Committee of the Board of Directors of KPMG LLP as the independent registered public accounting firm of the company for the fiscal year 2024. The third item of business today is the advisory vote on the compensation of Gran Tierra's named executive officers, as disclosed in the proxy statement.
We will now pause to address any stockholder questions we have received relating to these proposals.
... Seeing as there is no questions on the proposals, the polls for voting at our 2024 annual meeting will now be closed. The preliminary report of the Inspector of Election covering the proposals presented at this meeting is as follows: Each of the nominees for election to the board, Peter Dey, Gary Guidry, Evan Hazell, Robert Hodgins, Allison Redford, Ronald Royal, Sandra Scott, David Smith, and Brooke Wade, have been duly elected. 2, the proposal to ratify the appointment of KPMG LLP as the independent registered public accounting firm of the company for 2024 has been approved. 3, the proposal to approve, on an advisory basis, the compensation of Gran Tierra's named executive officers, as disclosed on the proxy statement, has been approved. The final voting results of today's meeting will be reported on a Form 8-K and filed within 4 business days of this meeting.
The 2024 annual meeting of stockholders is now adjourned. I wish to thank all of you for attending today's meeting and for your interest you have shown in the affairs of our company. Gary Guidry, President and CEO, will now make a presentation regarding the company's recent business.
Thank you, Bob. Please go to slide 3. Gran Tierra continues to deliver year-on-year strong reserve replacement, which is a testament to our top-tier conventional assets that are all under waterflood. During 2023, we achieved reserve replacement of 154% on proven, 242% on proven plus probable, and 303% on proven plus probable plus possible. We are very excited about the future development portfolio and exploration prospects, especially in the southern Putumayo and northern Ecuador. In 2024, we are targeting high-impact, near-field exploration and are currently drilling in Ecuador. Since January 1, 2023, we repurchased approximately 3.3 million shares, 10% of the outstanding amount, all from free cash flow.
In late 2023, we completed a highly successful bond exchange that aligns our future cash flows to debt maturities, and we're targeting net debt to EBITDA of less than 1x going forward, which we expect to achieve by the end of 2024. Who is Gran Tierra? We are a full cycle explorer, develop and optimize our production and recovery. We focus on low cost structure. Our operating costs are low in terms of our peers, and we focus our CapEx on driving down costs through innovation and technology. We also focus our cash flow on our asset value, not just production, not just reserves, and we use our free cash flow to pay down debt and for shareholder returns, which is currently buying back shares, which are trading at a discount to our proven, developed, producing reserve base.
We are top quartile in safety and performance, both in Colombia and with our international peers. A snapshot of the company. Our current product mix is 100% oil. We do produce gas, which we consume to generate electricity, and we operate 100% of our assets. We have the largest land portfolio in the Putumayo Basin, 1.4 million gross acres, 25 blocks across Colombia and Ecuador. Operating allows us to prioritize our capital allocation and adapt programs based on market conditions and drilling results. We, as a company, are firing on all cylinders. This slide does a good job of summarizing the last four years for Gran Tierra, with a 15% increase in proven reserves, 11% increase in proven plus probable reserves, while producing 33 million barrels during the same period.
We've also seen a 44% increase in our production and a 34% decrease, reduction in our debt. Key objectives for the company. Outlined here is our base 2024 guidance. We expect an average production of 33,500 barrels of oil per day, and using an $80 Brent price estimate, we expect to generate $430 million of midpoint EBITDA, $300 million of funds flow, and $75 million of free cash flow. Our—The next two slides are based on our 2023 year-end McDaniel reserve report. We focus on 2P reserves near term and our 3P reserves long term.
For the next five years, we have the capability on a 2P basis, proven plus probable, to produce an average of 46,000 barrels of oil per day, depending on our capital allocations to those reserves. With a peak production profile, we expect to be over 50,000 barrels a day in 2027. The next slide is a, is the free cash flow economics forecast of our funds flow and free cash flow for each profile, and on a 2P basis, for the next five years, we expect to generate $1.5 billion of free cash flow. That's about three times our current $510 million of net debt at the end of the Q1 2024. Capital allocation for 2024.
We believe, as a management team, in the balanced approach when it comes to capital allocation. Our capital programs are self-funded through our cash flow. Our objective is to optimize value of reserves and production, and again, excess free cash flow allocated to strengthening our balance sheet by reducing our net debt, buying back shares on the open market while trading at significant discounts to proven value. Debt maturity. As previously mentioned, our debt maturity profile after the 2023 bond exchange is aligned with our projected future cash flow, allowing us to pay maturities as they come due. At the end of the Q1, 2024, we finished with $127 million of cash on the balance sheet and a net debt of $510 million.
Just a waterflood overview, just pointing out that Gran Tierra's portfolio, the majority of our portfolio is under waterflood. We have very large original oil in place fields, all under waterflood, which is a stable, predictable, enhanced recovery technique. Potential to double the ultimate recovery in each of these fields. So, for example, every 1% increase in our portfolio recovery factor is 12 million barrels in increased proven plus probable reserves. Our year-end reserves, you can see we have a balanced portfolio between cash flow generators, for example, the Acordionero field, and growth assets, where we have a significant development runway. This slide does a good job showing the diversification between Gran Tierra's four major asset areas. At Costayaco, we wanted to give you an example of our approach and potential.
The success of the recent development wells has confirmed our geologic and reservoir modeling as a predictive tool in identifying unswept oil. This is a high-return drilling opportunity that enhances value and oil recovery in high-quality, mature, conventional oil fields. The results of this, the wells drilled in the north, are very encouraging and suggest follow-up locations in other areas of the Costayaco field, which we'll repeat in all of our major assets. Sur Oriente. The Sur Oriente block was set to expire and be relinquished back to Ecopetrol in June of 2024. Our team was able to negotiate a 20-year continuation of this project with our good relations with Ecopetrol as an active partner, and jointly develop oil reserves for years to come. With a 20-year extension, we are excited to be able to implement our enhanced value through waterflood expansion.
This includes additional facilities, infill drilling, further appraisal drilling of what we believe will be an extension of the field to the north. As you can see on this slide, there are many future drilling locations and additions of low-risk reserves and value. Our exploration. This is a map that shows you the Oriente and Putumayo basins. In 2022, Gran Tierra had three significant discoveries in the Putumayo region of Colombia and the Oriente region of Ecuador. This is a highly prolific, proven, contiguous geology that spans across the Colombia-Ecuador border. In 2024, we have developed an exploration program that will allow us to follow up on the three successful discoveries, the first of which is the Arawana-1 well in the Chanangue block of Ecuador, which is already spud in April.
All exploration wells are high impact, near field, near producing fields, access to infrastructure, and this allows us for rapid commercialization on discovery. The Basal Tena formation, we believe is, is the formation in the Chanangue block and equivalent to the N-Sand in Colombia, one contiguous basin. And specifically in the Cohembi field, in the Putumayo, as of the year-end 2023, the Cohembi field has produced 28 million barrels, and our plans for expansion will allow for another 25 million barrels proven, 54 million barrels of proven plus probable, and 95 million barrels of proven plus probable plus possible through enhanced recovery waterflooding. The significance of this is the Arawana discovery, the Arawana well that we're currently drilling in Ecuador. The geologic deposition, trapping, and size are a direct analog to the Cohembi field. Bocachico, to the west, was a great indicator of oil charge....
It produced an initial rate over 90 days of 1,100 barrels of oil per day. So far, it's accumulated 330,000 barrels of oil, with less than 1% water cut. It's still producing today 850 barrels of oil per day, which encouraged us to drill the Arawana well, as you can see on the map. Arawana open hole logging results are positive. We are very excited to get this well cased and start testing Arawana during May. Health, safety, and environment. This graph is based off an internal study conducted with the Colombian Health, Safety, and Environment National Committee. The findings of that study were that Gran Tierra has consistently been the best performer on an LTIF and a TRIF year over year in the country.
This is something we are very proud of, and Gran Tierra, excuse me, Gran Tierra's safety, an example of Gran Tierra's safety culture and processes. Finally, on a social, on the social front, social license to operate is a very real thing anywhere in the world. This is true of Colombia and Ecuador as well. Gran Tierra is committed to providing meaningful local employment opportunities, buying local goods and services, and voluntarily investing in local, social, and environmental projects. This slide highlights some of the many things and achievements that we've had. I invite you to please visit our website for our recently released 2023 sustainability report. This concludes our presentation. Thank you for participating today.
I would like to encourage you to refer to our press release issued yesterday, May 1, 2024, and our updated corporate presentation on our website at grantierra.com. Both documents provide an overview of the excellent financial and operating results which Gran Tierra has achieved so far in 2024. Thank you.