SecProbe.io

CORRESP
1
filename1.htm

      Unassociated Document

                Jason H. Scott

              jscott@mcguirewoods.com

              Direct:
                704.373.8862

              Direct
                Fax: 704.353.6181

    January
      17, 2007

    Mr.
      H.
      Roger Schwall

    Assistant
      Director

    Division
      of Corporation Finance

    Mail
      Stop
      7010

    Washington,
      D.C. 20549-7010

              Re:

              Gran
                Tierra Energy Inc. (the
“Company”)

    Amendment
      No. 3 to Registration Statement on Form SB-2

    Filed
      December 7, 2006

    File
      No. 333-132352

    Form
      10-KSB, as amended, for the fiscal year ended December 31,
      2005

    Form
      10-QSB, as amended, for the fiscal quarter ended September 31,
      2006

    File
      No. 333-111656

    Dear
      Mr.
      Schwall:

    This
      is
      in response to your comment letter to Dana Coffield dated January 5, 2007 with
      respect to the above-referenced filings. The Company is simultaneously filing
      Amendment No. 4 to Registration Statement No. 333-132352, Amendment No. 4 to
      Form 10-KSB for the period ended December 31, 2005, and Amendment No. 2 to
      Form
      10-QSB for the quarterly period ended September 30, 2006.

    We
      have
      set forth below the comments in your letter dated of January 5, 2007 in italics
      with the Company’s responses to each.

    Form
      SB-2/A3

    General

              1.

              We
                note that you have added shares to the Form SB-2 that were sold in
                a
                private placement that closed in June 2006. Since you originally
                filed the
                Form SB-2 in March 2006, you may not add these shares to this registration
                statement. The underlying private placement must be completed before
                you
                first file the resale registration statement. Please refer to the
                Manual
                of Publicly Available Telephone Interpretations, March 1999 Supplement,
                Interpretation 3S(b). This manual is available from our website at
                www.sec.gov. Please call us to discuss this
                issue.

      January
        17, 2007

      Page
        2

    RESPONSE:
      The
      Staff’s comment is noted and the Company has removed the shares sold in the
      private placement that closed in June 2006 from the Registration Statement
      No.
      333-132352. The Company is simultaneously filing a new registration statement
      on
      Form SB-2 to register those shares sold in the private placement that closed
      in
      June 2006.

              2.

              Certain
                comments written on your latest amendment to your registration statement
                also pertain to the comparable areas of your Form
                10-KSB.

    RESPONSE:
      We
      have
      indicated in this letter where our responsive changes appear in the marked
      versions of the Form SB-2/A and Form 10-KSB/A. All corresponding changes have
      been addressed throughout each of these documents.

    Management's
      Discussion and Analysis, page 56

              3.

              We
                note that you had revenues from operations in 2005. If you also have
                revenues from operations in 2006, please revise you MD&A section to
                comply with Item 303(b) of Regulation S-B. Specifically, please discuss
                your financial condition, with particular emphasis on your future
                prospects, especially in light of your recent acquisitions. Do not
                merely
                recite information that is evident from the financial statements.
                If
                material, disclose any known trends, events or uncertainties that
                are
                reasonably likely to have a material impact on your liquidity, especially
                in light of your recent acquisitions; material commitments for capital
                expenditures and expected sources of funds to pay for such expenditures,
                especially in light of your recent acquisitions; and the causes for
                any
                material changes from period to period in your line
                items.

    RESPONSE:
      The
      Company has revised the Management’s Discussion and Analysis section on pages 30
      to 39 of Form SB-2/A to comply with Item 303(b) of Regulation S-B.

    Directors,
      Executive Officers Promoters and Control Persons, page 77

              4.

              Provide
                the information required by Item 407(a) of Regulation S-B in regard
                to
                director independence.

    RESPONSE:
      The
      Company has revised page 55 of Form SB-2/A to provide the information required
      by Item 407(a) of Regulation S-B in regard to director
      independence.

    Security
      Ownership of Certain Beneficial Owners and Management, page
      81

              5.

              If
                applicable, provide the ownership information required by amended
                Item
                403(b) of Regulation S-K.

      January
        17, 2007

      Page
        3

    RESPONSE:
      The
      Company has revised the Security Ownership of Certain Beneficial Owners and
      Management section on page 56 of Form SB-2/A to provide the ownership
      information required by amended Item 403(b) of Regulation S-K, as
      applicable.

    Executive
      Compensation, page 83

              6.

              Revise
                you disclosure in this section to comply with the amended Item 402
                of
                Regulation S-B. Information on compensation for your 2006 fiscal
                year
                should also be included.

    RESPONSE:
      The
      Company has revised the Executive Compensation section on page 58 of Form SB-2/A
      to comply with amended Item 402 of Regulation S-B and to include information
      on
      compensation for the fiscal year ended December 31, 2006.

    Financial
      Statements - 14% Interest in the Palmar Largo Joint
      Venture

    Schedule
      of Revenues, Royalties and Operating Costs, page F-118

              7.

              Please
                amend the registration statement to include an auditor's report that
                opines on the Schedule of Revenues, Royalties and Operating Costs
                Corresponding to the 14% Interest in the Palmar Largo Joint Venture
                for
                the years ended December 31, 2004 and
                2003.

    RESPONSE:
      The
      Company has included an auditor’s report on page F-119 of Form SB-2/A and page
      50 of Form 10-KSB/A that opines on the Schedule of Revenues, Royalties and
      Operating Costs Corresponding to the 14% Interest in the Palmar Largo Joint
      Venture for the years ended December 31, 2004 and 2003.

              8.

              Please
                include all SFAS 69 disclosures that apply to an income statement
                only
                format as required by SFAS 69, SAB Topic 2:D, questions 5 and 7 and
                Item
                302(b) of Regulation SK. The inclusion of this information was requested
                verbally on October 23, 2006.

    RESPONSE:
      The
      Company has included SFAS 69 disclosures on pages F-118, F-123 and F-124 of
      Form
      SB-2/A and pages 49, 54 and 55 of Form 10-KSB/A. The SFAS 69 disclosures were
      prepared by calculating the Company’s 14% interest from the 2004 independent
      reserve report from Pluspetrol S.A., a partner in the Palmar Largo joint
      venture. Enclosed herewith, please find a copy of the 2004 independent reserve
      report.

    The
      Company was not able to obtain a reserve report for 2003. The Company’s partner,
      Pluspetrol S.A., did not prepare a reserve report for 2003. The company that
      sold its 14% interest in Palmar Largo to the Company did not obtain a reserve
      report for either 2004 or 2003. The one Palmar Largo partner that may have
      prepared a 2003 reserve report for Palmar Largo has refused to provide that
      report to the Company.

    Therefore,
      the Company prepared the SFAS 69 disclosures from the 2004 reserve report,
      the
      Palmar Largo production data for 2003 and the December 31, 2003 and December
      31,
      2004 independently reported sales price. The opening reserves balance for 2004
      was calculated by adding the 2004 production to the December 31, 2004 reserves
      balance from the 2004 reserve report. The closing balance for 2003 was obtained
      by using the opening 2004 reserve balance. The 2003 opening reserves balance
      was
      derived by adding the 2003 closing reserves balance to the 2003 production,
      based on the Company’s 14% interest in Palmar Largo. The Standardized Measure of
      Discounted Cash Flows for December 31, 2003 was obtained by using the 2004
      cash
      flows from the 2004 reserve report adjusted for 2004 production and 2004
      operating expenses (from the audited statement of Revenues, Royalties and
      operating expenses) and 2004 capital expenditures (estimated from the audit
      work
      done for 2004 ).

      January
        17, 2007

      Page
        4

              9.

              We
                note your amendment to the registration statement only included consents
                from accountants that opined on the financial statements of Gran
                Tierra
                Energy Inc. for the period January 26, 2005 through December 31,
                2005, and
                the Argosy International, L.P. financial statements for the years
                ended
                December 31, 2005 and 2004. Please amend your filing to include consents
                for inclusion of the audit reports on the financial statements of
                Gran
                Tierra Energy, Inc. for the nine months ended September 30, 2006,
                and the
                Schedules of Revenues, Royalties and Operating Costs Corresponding
                to the
                14% Interest in the Palmar Largo Joint
                Venture.

    RESPONSE:
      The
      Company has included the consents for inclusion of the audit reports on the
      financial statements of Gran Tierra Energy, Inc. for the nine months ended
      September 30, 2006, and on the Schedules of Revenues, Royalties and Operating
      Costs Corresponding to the 14% Interest in the Palmar Largo Joint Venture as
      exhibits to the Registration Statement on Form SB-2/A as Exhibits 23.2 and
      23.3,
      respectively.

    Form
      10-KSB, as amended, for the fiscal year ended December 31,
      2005

    Explanatory
      Paragraph

              10.

              Please
                delete the reference to filing the amendment in response to SEC comments
                and summarize the changes you made in the
                amendment.

    RESPONSE: The
      Company has deleted the reference to filing the amendment in response to SEC
      comments and has summarized the changes made in the amendments to Form
      10-KSB.

    Form
      10-QSB/A for the Interim Period Ended September 30, 2006

              11.

              We
                note this amendment includes only the pages you have changed. Please
                note
                that amendments must set forth the complete text of each item undergoing
                revision. Therefore, it will be necessary to further amend your filing
                to
                include the complete text of your financial
                statements.

    January
      17, 2007

      Page
        5

    RESPONSE:
      The
      Company has amended Form 10-QSB/A for the quarterly period ended September
      30,
      2006 to include the complete text of the Company’s financial
      statements.

    By
      copy
      of this letter, we are forwarding six marked copies of Amendment No. 4 to Form
      SB-2 to each of Donna Levy and Jennifer Gallagher of your office. We are also
      forwarding four copies of Amendment No. 4 to Form 10-KSB and four copies of
      Amendment No. 2 to Form 10-QSB to Donna Levy. If you have any questions, please
      contact me at (704) 373-8862.

              Sincerely,

              /s/
                Jason H. Scott

              Jason
                H. Scott

              cc:

              Donna
                Levy

    Dana
      Coffield

    Martin
      Eden

    James
      Hart

    Louis
      Zehil

    Jennifer
      Gallagher

    James
      Murphy