July 12, 2012 / 1:41 PM / 5 years ago

UPDATE 2-Gran Tierra says output hit by pipeline disruptions

* Second quarter output down 10 pct at 16,300 boepd

* Expects production to return to normal next week

* Plugs well in central Columbia

July 12 (Reuters) - Gran Tierra Energy Inc said it no longer expected to meet its 2012 production forecast due to disruptions at the Oleoducto Transandino (OTA) pipeline in Colombia and cut its capital budget for the year by 14 percent.

The OTA pipeline, operated by Colombia's state oil company Ecopetrol SA, runs through Bolivia, Colombia, Ecuador and Peru. Ecopetrol's pipelines, including OTA, have been disrupted by guerrilla attacks, the latest of which occurred about a week ago.

The South America-focused oil and gas producer said output is expected to return to normal early next week and it would give a revised full-year forecast after production returns to normal.

Gran Tierra had forecast an average production of 20,000-21,000 barrels of oil equivalent per day (boe/d) in 2012.

"Severity of the attacks (on the pipeline) has increased. It is the same old problem, but a bit more elevated," said analyst Darren Engels of Firstenergy Capital.

Pipeline disruptions also impacted its second-quarter production, which fell 10 percent to 16,300 boe/d.

"I think second-quarter volumes are weaker than what people were hoping for," Engels said.

The analyst, who has an "outperform" rating on the stock, said the company is still very well financed.

In view of the constrained production and weak commodity prices, Gran Tierra cut its 2012 capital expenditure budget by $60 million to $380 million.

The Calgary, Alberta-based company also said it plugged and abandoned its Bordon-1 exploration well in Garibay block in central Columbia as it was not commercially viable.

The company's shares fell as much as 9 percent to C$4.10 on Thursday on the Toronto Stock Exchange.

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