21 Apr 2005 07:00
Global Energy Development PLC21 April 2005 Immediate Release 21 April 2005 GLOBAL ENERGY DEVELOPMENT PLC NEW CRUDE OIL SALES CONTRACT OFFERING IMPROVED TERMS Global Energy Development PLC ("Global" or the "Company"), the Latin Americafocused petroleum exploration and production company (LSE-AIM: "GED"), ispleased to announce that it has entered into a new crude oil sales contract withPetrobras Colombia Limited, a subsidiary of Petrobras, the state oil company ofBrazil, with effect from 1 May 2005. The new non-exclusive contract offers Global much improved terms through areduced quality adjustment levy with the Company anticipating an approximate$3.00 uplift in the net well-head price it receives per barrel. Qualityadjustment levies can fluctuate daily based upon market conditions and slightvariances in production blend. The contract is for an initial one year with an automatic renewal unless advancenotice is received from either party and covers all crude oil production fromthe Company's Palo Blanco, Anteojos, Rio Verde, Torcaz and Bolivar fields inColombia, net of royalties paid to the Colombian government and Ecopetrol'sportion of production from one well, Cajaro 1. Commenting on the new crude oil sales contract, Stephen Voss, Global's ManagingDirector, said: "With the recent addition of production from our new Rio Verde field andcontinued success of the Mirador formation in the more established Palo Blancofield the overall volume of Global's lighter oil gravity has increased. As aresult, the Company has been able to mix its heavier and light crudes togetherinto a widely accepted medium quality blend. This blend will now be sold on anaggregated basis at a higher overall price yield compared to our previous singlewell sales contracts that resulted in deeper price discounts for our heavieroils.The ability of the Company to improve its' overall blend quality and hence getpreferential pricing has been facilitated by the increased number of producingwells in the Company's diversified portfolio compared to when Global floated onAIM over three years ago. We currently have production from 11 wells compared tojust two, both of which were of heavy oil quality, in early 2002. We expect tofurther increase our producing well assets as the Company develops its provedand probable reserves and adds significantly to the already 3 million acresunder contract and pending contract in 2005. As previously indicated, escalating income from production will allow increasingexpenditure on exploration on properties held under contract in addition tofurther workovers and development drilling." For further information: Global Energy Development PLCCatherine Miles, director of Investor Relations +44 (0) 20 7808 5550www.globalenergyplc.com +44 (0) 7909918034------------------------- Notes to Editors: Global holds exclusive contracts and rights to explore for and / or produce oiland gas from a geographically diversified portfolio of prospective acreage inColombia, Panama and Peru. This information is provided by RNS The company news service from the London Stock Exchange