(RTTNews) - Canadian independent energy company Gran Tierra Energy Inc. (GTE: News ,GTE.TO: News ) Friday reported a net loss for the third quarter compared to a profit in the prior year. Results were affected by lower oil prices, a significant increase in operating costs as well as foreign exchanges losses.

For the third quarter, the company's net loss and comprehensive loss was US$2.82 million or US$0.01 per share compared to an income of US$22.99 million or US$0.18 per share last year.

Results for the quarter included a foreign exchange loss of US$18.9 million due to an unrealized non-cash foreign exchange loss of US$20.3 million with regard to translation of deferred tax liability recorded on acquisition of Solana Resources. The company stated that a strengthening Colombian peso against the U.S. dollar resulted in foreign exchange losses, estimated at US$70 thousand for each one peso decrease in the exchange rate of Colombian peso to one U.S. dollar.

Revenues and other income for the period surged to US$75.35 million from US$40.34 million in the prior year quarter. Gran Tierra attributed the increase in revenues to a 209% rise in production, primarily due to higher production from continued development of Costayaco field in Chaza Block in Colombia, and addition of production from Solana Resources' interests in Colombia.

Oil and natural gas sales for the third quarter were US$75.17 million versus US$40.08 million, while revenues from interest slumped to US$183 thousand from US$257 thousand a year earlier.

For the quarter ended September 30, 2009, the company increased its production to 12,945 barrels of oil per day, or BOPD, net after royalty from 4,194 BOPD net after royalty in the corresponding period prior year.
The average price received per barrel of oil in the third quarter dropped 39% to US$63.12 from US$103.88 in the previous year. Funds flows from operations were US$53.13 million compared to US$17.77 million in the prior year quarter.

During the three-month period, total expenses incurred by Gran Tierra increased to US$70.21 million from US$9.48 million last year. Operating costs for the third quarter increased to US$9.10 million from US$4.51 million in the same quarter in 2008. On a per barrel basis, operating expenses declined by 35% to US$7.64 per barrel from US$11.70 per barrel a year ago, reflecting higher producing wells.

Depletion, depreciation and accretion expenses for the quarter ended September 30, 2009 rose to US$35.2 million or US$29.59 per barrel from US$6.8 million or US$17.51 per barrel in fiscal 2008, reflecting higher production levels and amortization of US$26.9 million in the quarter with regard to fair value of property, plant and equipment recorded on acquisition of Solana Resources.

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