Scandinavian Oil-Gas Magazine
http://www.scandoil.com/moxie-bm2/news/global-energy-development-launches-three-year-plan.shtmlGlobal Energy Development launches three year plan
Global Energy Development has reported details of its Three Year Plan running 2010 through to the end of 2012 prepared in conjunction
Global Energy Development has reported details of its Three Year Plan running 2010 through to the end of 2012 prepared in conjunction with independent consultants.
The purpose of the Plan is to increase production volumes whilst developing the Company's reserve base and represents much increased drilling activity when compared to historic levels. The Plan includes the drilling of 13 strategically located wells, plus one well re-entry, two accompanying seismic acquisition programmes and the construction of facilities. The Company owns 100% of all its contracts and hence holds a 100% interest in all the wells to be drilled.
The wells to be drilled were selected from over 1,000 potential drill sites by the independent petroleum engineers Ralph E. Davis Associates, Inc. ("RED") after re-evaluating all technical data. RED selected the wells with the purpose of trying to move the majority of the Company's current probable and possible reserves into the proved reserve category whilst significantly increasing daily production volumes. The Company's net probable and possible reserves stand at a combined 212.1 million barrels of oil equivalent ("BOE") per a reserve report independently prepared by RED dated 31 December 2009. The Company's proved reserves stand at 60.8 million BOE net to the Company per the same report.
Cost estimates for the wells to be drilled were sourced from a major oilfield services provider while RED provided production estimates. RED then assessed economics to establish the sequence of drilling which would maximize production and cash flow and negate or reduce the need for external cash to fulfill the Plan, with the Company intending to fund the entire Plan itself from cash flow from operations. For planning purposes the Company added cost contingencies and risked downwards RED's production estimates. Factoring these in, the total cost of the Plan is estimated at approximately $110 million and is anticipated to result in combined new production of approximately 9,000 barrels of oil per day ("BODP") net to the Company (total undeclined initial rate for all wells) in addition to moving an additional 200 million BOE to proved reserves (net to the Company) by the end of 2012.