2 Jul 2008 07:00
| For Immediate Release | 2 July 2008 |
GLOBAL ENERGY DEVELOPMENT PLC
AGM UPDATE
Global Energy Development PLC (the "Company"), the Latin America focused petroleum exploration and production company (LSE-AIM: "GED"), is pleased to provide an update on operations ahead of its Annual General Meeting ("AGM") being held later today.
During the first half of 2008, the Company successfully drilled and tested the Boral 1 exploratory well within the Colombian Rio Verde contract. The final stabilised test rate using an electric submersible pump was 630 barrels of oil per day ("bopd") with a water cut of 11.6% from the Ubaque formation. During June 2008, location works were completed and approved by the Colombian Ministry of Mines and Energy and the well has within the past week been put on a long-term production test of six months duration. The Boral 1 well has averaged gross production of 300 bopd since the commencement of the long-term test, with production being monitored and pump speeds controlled to optimise future oil recovery and assess water production trends.
During the first five months of 2008, the Company averaged net production of 983 bopd with the price for West Texas Intermediate ("WTI") crude oil and the Company's operating cash netback (after all costs, including general and administrative, and taxes) averaging $109 and $54 per barrel of oil respectively. With the addition of the Boral 1 well production, the Company's total net production is now approximately 1,300 bopd.
In addition to increased daily production, the successful Boral 1 well will allow for the reclassification of some of the Company's Boral field possible reserves which totalled just over 3 million barrels of oil equivalent ("BOE") net to the Company as at 31 December 2007. Ryder Scott Company, LP ("Ryder Scott"), the independent petroleum engineers who audit the Company's reserves yearly, are expected to complete very shortly a development plan for the Boral field based upon the Boral 1 well test results. This will include revised proved, probable and possible reserves based upon the Boral 1 well data.
The combination of high oil prices and the Company's increased daily production is significantly increasing cash flow with which to develop other areas of the Company's portfolio. The drilling of the Tilodiran 3 development well, also within the Rio Verde contract, is currently underway. The Company expects to reach total depth within the next week and begin evaluation of log data in the next several days. Initial test results are currently expected late July or early August 2008. The Company is now planning for the drilling of future wells, namely the Catalina 2 well located in the Catalina field within the Colombian Bolivar contract and the first well to be drilled within the Peruvian Block 95 contract by the Company.
For further information:
Global Energy Development PLC
Catherine Miles, Company Secretary +44 (0) 20 7763 7177
www.globalenergyplc.com +44 (0) 7909918034
Landsbanki Securities (UK) Limited +44 (0) 20 7426 9000
Fred Walsh / Sebastian Jones
Notes to Editors:
The Company's shares have been traded on AIM, a market operated by the London Stock Exchange, since March 2002 (LSE-AIM: "GED"). The Company's balanced portfolio covers the countries of Colombia, Peru and Panama and comprises a base of production, developmental drilling and workover opportunities and several high-potential exploration projects.
Ryder Scott reported that as at 31 December 2007, proved reserves net to the Company totalled 4.6 million BOE, proved plus probable ("2P") reserves net to the Company totalled 15.2 million BOE and proved plus probable plus possible ("3P") reserves net to the Company totalled 64.9 million BOE.
Proven and probable oil and gas reserves are estimated quantities of commercially producible hydrocarbons which the existing geological, geophysical and engineering data show to be recoverable in future years from known reservoirs. The proved reserves reported by Ryder Scott, independent petroleum consultants, conform to the definition approved by the Society of Petroleum Engineers ("SPE") and the World Petroleum Congress ("WPC"). The probable and possible reserves reported by Ryder Scott conform to definitions of probable and possible reserves approved by the SPE/WPC using the deterministic methodology.
The information contained within this announcement has been reviewed by Ryder Scott.
In addition, the information contained within this announcement has been reviewed by Mr. Stephen Voss and Mr. Stephen Newton, both Directors of the Company. Mr. Voss is a Registered Professional Engineer in Texas and has been a Member of SPE for 25 years. Mr. Newton holds a Mining/Petroleum Engineering degree from the University of Queensland, Brisbane and a Master of Science Petroleum Engineering degree from Imperial College London. He has been a Member of SPE for 35 years.