Global Energy Dev. GED Interim Results

  Global Energy Dev. (GED) - Interim Results

RNS Number : 1514N
Global Energy Development PLC
26 September 2012






Immediate Release 26 September 2012





                        GLOBAL ENERGY DEVELOPMENT PLC

                         ("Global" or the "Company")

                                      

                                      

            INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2012





Global Energy Development PLC, the South American focused petroleum production
and development  company  (AIM:  GED),  with  operations  in  Colombia,  South 
America, announces its interim results for the six month period ended 30  June 
2012 (the "Period").



HIGHLIGHTS:



• Revenue increased by 18 per cent. to $20.2 million (H1 2011: $17.1
million);

• Average gross production decreased 17 per cent. to 202,247 barrels of
oil ("bbls") (H1 2011: 244,040 bbls) due to the temporary downtime of the
Tilodiran 2 well (126 days) during the Period;

• Gain of $810,000, net of taxes (H1 2011: nil) on sale of remaining
interest in Block 95 in Peru ;

• Profit before taxation of $1.2 million (H1 2011; $2.6 million);

• Net profit of $2.0 million (H1 2011: $3.9 million net profit due to a
significant non-cash tax benefit of $1.2 million received); and

• Capital expenditures of $6.0 million predominantly related to the
workover programmes of the Tilodiran 2 and the Torcaz 5 wells and the
conversion of the Rio Verde 2 well into a water injection well.



Stephen Voss, Managing Director, commenting on the results, said:

"We are  in  a strong  financial  position  from recent  improvements  in  our 
on-going Llanos oil production and are focusing on partnering efforts and  our 
development plans in the Magdalena Valley".



For further information please contact



Global Energy Development PLC      +001 817 310 0240

Anna Williams, Finance Director

awilliams@globalenergyplc.com

www.globalenergyplc.com
Buchanan (Financial PR)            +44 (0)20 7466 5000

Tim Thompson

Ben Romney
Northland Capital Partners Limited +44 (0)20 7796 8800

Louis Castro

Lauren Kettle
Westhouse Securities               +44 (0) 20 7601 6100

Petre Norton

Andrew Matharu



Notes to Editors:



The Company's shares have been traded on AIM, a market operated by the  London 
Stock Exchange, since March 2002 (AIM: GED). The Company's balanced  portfolio 
comprises  a  base   of  production,  developmental   drilling  and   workover 
opportunities and several exploration projects in Colombia, South America.



The information contained within  this announcement has  been reviewed by  Mr. 
Stephen Voss, a Director of the Company, for the purpose of the Guidance  Note 
for Mining,  Oil and  Gas Companies  issued by  the London  Stock Exchange  in 
respect of AIM companies  which outlines standards  of disclosure for  natural 
resource projects. Mr. Voss  is a Registered  Professional Engineer in  Texas 
and has been a Member of the Society of Petroleum Engineers for 28 years.



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 Ralph  E. Davis  ("RED") 
independent petroleum engineers,  conform to  the definition  approved by  the 
Society of  Petroleum  Engineers  ("SPE")  and  the  World  Petroleum  Council 
("WPC"). The  probable  and possible  reserves  reported by  RED  conform  to 
definitions of probable and  possible reserves approved  by the SPE/WPC  using 
the deterministic methodology.





Forward-looking statements



This release  may  include  statements that  are,  or  may be  deemed  to  be, 
"forward-looking  statements".   These  forward-looking   statements  can   be 
identified by  the use  of forward-looking  terminology, including  the  terms 
"believes",  "estimates",  "plans",   "projects",  "anticipates",   "expects", 
"intends", "may", "will" or "should" or, in each case, their negative or other
variations or comparable  terminology, or by  discussions of strategy,  plans, 
objectives,  goals,  future  events   or  intentions.  These   forward-looking 
statements include all matters that are not historical facts. They appear in a
number of places throughout this release and include, but are not limited  to, 
statements regarding the Group's  intentions, beliefs or current  expectations 
concerning, among other things, the  Group's results of operations,  financial 
position, liquidity,  prospects, growth,  strategies and  expectations of  the 
industry.  By  their  nature,  forward-looking  statements  involve  risk  and 
uncertainty  because  they   relate  to  future   events  and   circumstances. 
Forward-looking statements are  not guarantees of  future performance and  the 
development of the markets  and the industry in  which the Group operates  may 
differ  materially   from   those  described   in,   or  suggested   by,   any 
forward-looking statements contained in this release. In addition, even if the
development of the markets  and the industry in  which the Group operates  are 
consistent with  the forward-looking  statements  contained in  this  release, 
those developments  may  not  be  indicative  of  developments  in  subsequent 
periods. A number  of factors  could cause developments  to differ  materially 
from those expressed or implied  by the forward-looking statements  including, 
without limitation, general economic and business conditions, industry trends,
competition,  commodity  prices,  changes  in  law  or  regulation,   currency 
fluctuations (including the  US dollar),  the Group's ability  to recover  its 
reserves or develop new reserves, changes in its business strategy,  political 
and economic uncertainty.  Save as required  by law, the  Company is under  no 
obligation to update the information contained in this release.



Past performance cannot be relied on as a guide to future performance.

CHAIRMAN AND MANAGING DIRECTOR'S STATEMENT & REVIEW OF OPERATIONS



Operations



Middle Magdalena Oil Reserves:



Several major  international  companies  such  as Shell  E&P  -  Colombia  and 
ExxonMobil Exploration  Colombia Limited  have recently  announced  partnering 
efforts in block areas adjacent to the Company's Bolivar Contract area in  the 
Middle  Magdalena  valley.  The  Company  may  also  pursue  partnering  with 
highly-experienced operators in  order to  accelerate the  development of  our 
substantial undeveloped reserve base and increase shareholder value.



Regarding our second largest 2P  reserve-based property, the Bolivar  Contract 
area, the  Company is  continuing its  planning with  third-party service  and 
equipment providers to  hydraulically fracture  the La Luna  formation in  the 
existing Olivo  2  well  during late  2012  or  early 2013  depending  on  the 
availability of equipment within the country.



As part of our strategy to increase production from the large reserve base  in 
our Middle Magdalena properties,  work began on the  Torcaz 5 well within  our 
Bocachico Contract area in mid-July. A progressive cavity pump was  installed 
at a depth of approximately 7,900 feet which was below the perforations in the
formation to  re-establish  oil  (and  sand)  production  and  lift  from  the 
wellbore. During the testing phase of  this pump, successful sanding and  oil 
shows were initiated.  However, oil  shows were interrupted  due to  periodic 
significant sand movement into the  wellbore which eventually overwhelmed  the 
capacity of  the  pump.  As a  result,  it  became evident  that  a  modified 
approach, combining the Cold Heavy Oil Production with Sand (CHOPS) technology
process and the partial application of conventional sanding restraints, should
be utilised  to moderate  sand  production and  enhance oil  production.  The 
Company hopes to  commence this process  in October and  planning efforts  are 
currently underway.



Llanos Basin Oil Production:



The overwhelming majority of the  Company's current oil production comes  from 
its contract  areas  located  within  the  Llanos  Basin  of  Colombia,  South 
America. The Company's focus for the  Llanos Basin production is to  maximise 
production volumes,  decrease  operating  costs and  utilise  cash  flow  from 
operations to develop  projects within  our Middle  Magdalena Valley  contract 
areas (Bocachico and Bolivar Association Contracts). Our original targets for
the Period  for the  Llanos  Basin properties  were  the recompletion  of  the 
Tilodiran 1 well to re-establish oil production and the conversion of the  Rio 
Verde 2 well to a water injection well in order to significantly reduce  water 
transportation and disposal  costs within  the Rio  Verde Concession  Contract 
area.



As previously announced,  the original  timing of these  projects was  delayed 
because, during  early  2012,  the  Company was  forced  to  perform  workover 
operations to replace  a failed pump  within the wellbore  of its Tilodiran  2 
well located within  the Rio  Verde Concession Contract  area. Shortly  after 
this work was completed,  in May 2012, the  electric submersible pump  ("ESP") 
failed again. Upon recovery of the  failed pump, the well was stimulated  and 
an ESP from a  different vendor was  installed at a  shallower depth of  8,800 
feet. This  subsequent workover  operation was  completed in  mid-June.  The 
Tilodiran 2 well is now online and producing stable rates of approximately 350
gross barrels of oil per day ("bopd"). Overall gross production decreased  by 
17 per cent. from 244,040 bbls to 202,247  in the Period due to the more  than 
120 days of  downtime of the  Tilodiran 2 well  during the Period.  Following 
completion of the workover, the  Company's average gross daily production  has 
been steadily averaging between 1,700 bopd and 1,800 bopd.



In July following the completion of the workover of the Tilodiran 2 well,  the 
Company commenced and completed the conversion of the inactive Rio Verde 2  to 
a water disposal well. The  Company successfully concluded short-term  water 
injection tests at  Rio Verde  2 and  has submitted  the test  results to  the 
Colombian Ministry of Mines  and Energy. Final  approval from the  Colombian 
authorities to  re-commence water  injection at  Rio Verde  2 is  expected  in 
October 2012. As  the Company transports  and disposes of  more than  120,000 
barrels of water each month from its Tilodiran field, we anticipate that  this 
disposal  well  will  save  an  average  of  $4.00  per  barrel  of  water  on 
transportation costs per month translating  into significant cost savings  for 
the Company.



Peru:



In June 2012, the  Company closed on  the sale of its  remaining 40 per  cent. 
working  interest  of  the  Peruvian  Block  95  License  Contract  for   cash 
consideration of $5.4  million with  $2 million  received at  closing and  the 
remaining $3.4 million  payable upon  the earlier  of either  approval of  the 
assignment from Perupetro,  Peru's national  agency for  hydrocarbons, or  one 
year from the closing date.  Based on the total  proceeds from the sale,  the 
Company was  able to  record  a net  gain after  tax  on this  transaction  of 
approximately $810,000. This sale allows the Company to remain focused on our
core value assets in Colombia.



Financials



During the Period, the  Company experienced increased  revenues due to  higher 
oil prices  as compared  to the  prior year  period. Average  realised  sales 
prices increased from $93.59 per bbl for the six months ended 30 June 2011  to 
an average  of $101.60  per bbl  in  the Period,  while gross  oil  production 
decreased by  17 per  cent.  from 244,040  bbls to  202,247  bbls due  to  the 
temporary downtime of the Tilodiran 2 well during the Period.



Cost of sales  increased 47%  from $9.7 million  to $14.3  million during  the 
Period. The major contributing factor  of this increase in operating  expense 
was higher  water volumes  and associated  disposal costs  from the  Tilodiran 
field. As  a reminder,  water  production increased  in mid-2011  along  with 
increased oil production from the Tilodiran field. Commencing water injection
into the recently converted Rio Verde 2 well will reduce future water disposal
costs. The Company also derecognised the cost of the damaged ESP of  $736,000 
in the Tilodiran 2 well when it was replaced during the Period.



The Company  ended  the  Period with  a  cash  balance of  $7.8  million  with 
increased cash flow from operations of  $5.9 million compared to $4.1  million 
in the prior period. Capital  expenditures of $6.0 million related  primarily 
to the required workovers on the Tilodiran 2 well, the workover operations  on 
the Torcaz 5  well and  the conversion  of the  Rio Verde  2 well  to a  water 
disposal well.  We were  able to  repay and  fully extinguish  the  remaining 
convertible notes outstanding of $9.5 million which became due and payable  in 
2012 with the securing of new long-term financing of $12 million. This  allows 
the Company to focus its capital resources on improvements of its on-going oil
production and  the continuation  of its  development plans  in the  Magdalena 
Valley.







Mikel Faulkner

Chairman





Stephen Voss

Managing Director



25 September 2012



INDEPENDENT REVIEW REPORT TO GLOBAL ENERGY DEVELOPMENT PLC



Introduction

We have been engaged by the Company to review the set of financial information
in the half-yearly  financial report  for the six  months ended  30 June  2012 
which comprises  the  Consolidated  Statement  of  Comprehensive  Income,  the 
Consolidated Statement  of  Financial  Position, the  Consolidated  Cash  Flow 
Statement, the  Consolidated  Statement  of  Changes  in  Equity  and  related 
explanatory notes 1 to 13.



We have  read the  other information  contained in  the half-yearly  financial 
report and  considered  whether  itcontains  any  apparent  misstatements  or 
material  inconsistencies  with  the  information  in  the  condensed  set  of 
financial information.



Directors' responsibilities

The interim report, including the financial information contained therein,  is 
the responsibility of and  has been approved by  the Directors. The  Directors 
are responsible for preparing the interim report in accordance with the  rules 
of the London Stock Exchange for companies whose securities are traded on  AIM 
which require that the half-yearly report be presented and prepared in  aform 
consistent with that  which will be  adopted intheCompany's annual  accounts 
having regard to theaccounting standards applicable to such annualaccounts.



Our responsibility

Our responsibility is to express to the Company aconclusion on the  condensed 
set of financial information in the half-yearly financial report based  onour 
review.



Our report has been prepared in accordance with the terms of our engagement to
assist the Company  in meeting  the requirements of  the rules  of the  London 
Stock Exchange for  companies whose securities  are traded on  AIM and for  no 
other purpose. No  person is entitled  to rely  on this report  unless such  a 
person is aperson entitled to rely upon this report by virtue of andfor  the 
purpose of our terms of engagement or  has been expressly authorised to do  so 
by our prior written consent. Save  as above, we do not accept  responsibility 
for this report to  any other person  or for any other  purpose and we  hereby 
expressly disclaim any and allsuch liability.



Scope of review

We conducted our review  in accordance with  International Standard on  Review 
Engagements (UK and Ireland) 2410,  ''Review of Interim Financial  Information 
Performed by the Independent Auditor of  the Entity'', issued by the  Auditing 
Practices Board for use in the  United Kingdom. A review of interim  financial 
information consists of making enquiries, primarily of persons responsible for
financial and accounting  matters, and  applying analytical  and other  review 
procedures. A review is substantially less in scope than an audit conducted in
accordance with  International  Standards on  Auditing  (UK and  Ireland)  and 
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit.  Accordingly, 
we do not express an audit opinion.





Conclusion

Based on our  review, nothing  has come  to our  attention that  causes us  to 
believe that the  condensed set  of financial information  in the  half-yearly 
financial report for the six months ended 30 June 2012 is not prepared, in all
material respects, in accordance with the  rules of the London Stock  Exchange 
for companies whose securities are traded on AIM.



BDO LLP

Chartered Accountants and Registered Auditors

55 Baker Street

London W1U 7EU

UK



25 September 2012







CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the period ended 30 June 2012

                            Six months ended  Six months ended  Twelve months
                                      30 June           30 June          ended
                                        2012              2011    31 December
                                        $'000             $'000           2011
                                 (Unaudited)       (Unaudited)          $'000
                                                                     (Audited)
Revenue                                20,179            17,096         43,070
Cost of sales                        (14,300)           (9,705)       (28,075)
Gross profit                            5,879             7,391         14,995
Other income                               39                 9             12
Administrative expenses               (3,282)           (3,629)        (6,669)
Finance income                             15                10             34
Finance expense                       (1,416)           (1,138)        (2,438)
Profit before taxation                  1,235             2,643          5,934
Tax (expense)/credit                     (41)             1,232        (3,938)
Profit from continuing                  1,194             3,875          1,996
operations, net of tax
Profit from discontinued                  810                 -              -
operations, net of tax
Total comprehensive income
attributable to the equity
holders of the parent                   2,004             3,875          1,996
Earnings per share for
continuing operations
- Basic                                 $0.03             $0.11          $0.06
- Diluted                               $0.03             $0.10          $0.05
Earnings per share for
discontinued operations
- Basic and diluted                     $0.02                 -              -







CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

                                       30 June            30 June  31 December

                                          2012               2011         2011

                                         $'000  $'000 (Unaudited)        $'000

                                   (Unaudited)                       (Audited)
Assets
Non-current assets
Intangible assets                          828              5,746        3,427
Property, plant and equipment          101,146            101,780       99,845
Total non-current assets               101,974            107,526      103,272
Current assets
Inventories                              1,522              2,964        1,939
Trade and other receivables             11,144              8,276        5,452
Prepaids and other assets                2,423              1,718        1,299
Term deposits                            1,384              1,728        1,718
Cash and cash equivalents                7,758              5,713        4,331
Total current assets                    24,231             20,399       14,739
Total assets                           126,205            127,925      118,011
Liabilities
Non-current liabilities
Convertible loan notes                       -           (16,577)            -
Deferred tax liabilities (net)         (9,936)            (5,764)     (10,116)
Equity tax liability                     (646)            (1,267)        (968)
Long-term provisions                   (3,710)            (3,278)      (2,779)
Long-term loans payable               (12,164)            (5,000)        (227)
Total non-current liabilities         (26,456)           (31,886)     (14,090)
Current liabilities
Convertible loan notes                       -                  -      (9,372)
Trade and other payables               (8,264)           (10,107)      (5,556)
Corporate and equity tax liability     (1,628)            (1,456)      (1,184)
Provision                                 (82)               (96)         (82)
Short-term   loan   payable    and     (5,144)                  -      (5,222)
financing leases
Total current liabilities             (15,118)           (11,659)     (21,416)
Total liabilities                     (41,574)           (43,545)     (35,506)
Net assets                              84,631             84,380       82,505
Capital and reserves attributable
to equity holders of the company
Share capital                              549                545          546
Share premium account                   27,139             27,139       27,139
Other reserve                                -              1,767          927
Capital reserve                        210,844            210,844      210,844
Retained deficit                     (153,901)          (155,915)    (156,951)
Total equity                            84,631             84,380       82,505



The financial information contained in this announcement was approved and
authorised for issue by the Board of Directors on 25 September 2012 and is
signed on its behalf by:



Mikel Faulkner   Stephen Voss

Chairman       Managing Director



CONDENSED CONSOLIDATED CASH FLOW STATEMENT

                                  Six months ended   Six months  Twelve months
                                           30 June        ended          ended
                                              2012      30 June    31 December
                                             $'000         2011           2011
                                       (Unaudited)        $'000          $'000
                                                    (Unaudited)      (Audited)
Cash   flows    from    operating 
activities
Operating profit before  interest            2,636        3,771          8,338
and  taxation   from   continuing 
operations
Operating profit before  interest            1,157
and  taxation  from  discontinued 
operations
Depreciation,    depletion    and            3,182        3,735          8,424
amortisation
Gain on disposal  of assets  from          (1,157)            -              5
discontinued operations
Write-off of workover costs                    736            -              -
(Increase)  in  trade  and  other          (2,293)      (3,698)          (930)
receivables
Decrease/(increase)            in              417      (1,414)          (389)
inventories
Increase  in   trade  and   other            2,708        1,828            437
payables
(Decrease)/increase in  long-term              (1)          213          (482)
provisions
Share-based  payments  and  other              110          103            107
non-cash items
Cash  generated  from  continuing            7,495        4,538         15,510
operations
Taxes paid                                 (1,571)        (430)        (1,344)
Net  cash  flows  from  operating            5,924        4,108         14,166
activities
Investing activities
Capital expenditure
- Expenditure on property,  plant          (4,744)      (2,619)        (5,596)
and equipment
-   Expenditure   on   intangible          (1,274)        (712)          (393)
assets
Disposal of  property, plant  and            2,000            -             65
equipment
Interest received                               15            8             34
Increase/(decrease) in short-term              333        (262)          (252)
investments
Net  cash  flows  from  investing          (3,670)      (3,585)        (6,142)
activities
Financing activities
Proceeds from  placement of  note           11,938            -              -
payable
Short-term   loans   (paid)/drawn             (78)      (1,285)        (9,124)
during the period
Convertible loan notes payments            (9,561)            -           (95)
Interest paid                              (1,129)        (869)        (1,818)
Proceeds from  exercise of  share                3            -              -
options
Net  cash  flows  from  financing            1,173      (2,154)       (11,037)
activities
Increase/(decrease) in  cash  and            3,427      (1,631)        (3,013)
cash equivalents
Cash  and  cash  equivalents   at            4,331        7,344          7,344
beginning of period
Cash and cash equivalents at  end            7,758        5,713          4,331
of period







CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the six months ended 30 June 2012
                              Share   Share    Other Capital  Retained

                            Capital Premium Reserves Reserve   deficit   Total

                              $'000   $'000    $'000   $'000     $'000   $'000
At 1 January 2011              540  26,544    1,826 210,844 (159,928)  79,826
(Audited)
Total comprehensive loss        -     -      -     -     3,875   3,875
for the period
Share-based payments            -       -      -    -       103     103
Exercise of convertible           5     595     (59)       -        35     576
notes
At 30 June 2011 (Unaudited)     545  27,139    1,767 210,844 (155,915)  84,380
Total comprehensive loss        -     -        -     -   (1,879) (1,879)
for the period
Share-based payments              1     -        -     -         3       4
Redemption of convertible         -       -    (840)       -       840       -
notes
At   31    December    2011     546  27,139      927 210,844 (156,951)  82,505
(Audited)
Total comprehensive income        -       -        -       -     2,004   2,004
for the period
Share-based payments              3       -        -       -       119     122
Redemption of convertible         -       -    (927)       -       927       -
notes (Note 7)
At 30 June 2012 (Unaudited)     549  27,139        - 210,844 (153,901)  84,631





UNAUDITED NOTES FORMING PART OF THE CONDENSED CONSOLIDATED INTERIM FINANCIAL
INFORMATION

For the six months ended 30 June 2012



1. Accounting Policies

Basis of Preparation

The condensed interim financial information  has been prepared using  policies 
based  on  International  Financial   Reporting  Standards  (IFRS  and   IFRIC 
interpretations)  issued  by  the  International  Accounting  Standards  Board 
("IASB") as  adopted  for use  in  the  EU. The  condensed  interim  financial 
information has  been prepared  using the  accounting policies  which will  be 
applied in  the Group's  statutory financial  information for  the year  ended 
31December 2012.



2. Financial reporting period

The condensed interim financial information for  the period 1 January 2012  to 
30 June  2012 is  unaudited. In  the opinion  of the  Directors the  condensed 
interim financial information  for the  period presents  fairly the  financial 
position, results from operations and cash flows for the period in  conformity 
with the generally  accepted accounting principles  consistently applied.  The 
condensed interim financial information  incorporates comparative figures  for 
the interim period 1 January  2011 to 30 June  2011 and the audited  financial 
year to 31 December 2011.



The financial information contained in this interim report does not constitute
statutory accounts as defined  by section 435 of  the Companies Act 2006.  The 
comparatives for the full  year ended 31 December  2011 are not the  Company's 
full statutory accounts for  that year. A copy  of the statutory accounts  for 
that year has  been delivered  to the  Registrar of  Companies. The  auditors' 
report on those accounts  was unqualified, did not  include references to  any 
matters to  which the  auditors  drew attention  by  way of  emphasis  without 
qualifying their  report  and  did  not  contain  a  statement  under  section 
498(2)-(3) of the Companies Act 2006.



3. Revenue

Revenue is attributable to  one continuing activity,  which is oil  production 
from Colombia Energy Development Co.  ("CEDCo"), a wholly-owned subsidiary  of 
the Group, located in Colombia, South America.



4. Discontinued operations - Peru

In June 2012,  the Company closed  on the sale  of its remaining  40 per  cent 
working interest  of  the Peruvian  Block  95 License  Contract  ("Block  95") 
through its wholly-owned subsidiary to Gran Tierra Energy, Inc. ("GTE"). Block
95 was the Company's only Peruvian asset, located in the Marañon Basin in  the 
north-east area of the country, with net 2P reserves of 8.4m barrels of oil as
reported in  the Company's  annual report  and  accounts for  the year  to  31 
December 2011. The contract is in  its third exploration phase although it  is 
currently under  force  majeure,  pending approval  of  certain  environmental 
licensing requirements. Block 95 did not generate any revenues or expenses  in 
the year to 31 December 2011.



Under the terms of the  purchase and sale agreement,  the Company sold its  40 
per cent working interest to GTE  for cash consideration of $5.4 million  with 
$2 million received upon closing and  the remaining $3.4 million payable  upon 
the earlier  of  either approval  of  the assignment  from  Perupetro,  Peru's 
national agency of hydrocarbons,  or one (1) year  from the closing date.  The 
effective date of the sale was 1 June 2012. The proceeds from the sale will be
used for working capital generally.  This sale included all intangible  assets 
of the  wholly-owned  subsidiary. The  Company  recognised a  net  gain  after 
taxation on the sale of these assets  of approximately $810,000 as of 30  June 
2012. Following  the completion  of  this divestiture,  the Company  holds  no 
further interests in Block 95 in Peru.



The following are the totals for  the major classes of assets and  liabilities 
relating to our discontinued operations associated with Block 95:



                                                              Six months ended
                                                                       30 June
                                                                          2012
                                                                         $'000

                                                                   (Unaudited)
Net Assets disposed of:
Intangible assets                                                       $4,600
Trade and other payables                                                 (357)
                                                                         4,243
Proceeds on disposal of discontinued operations
Cash and cash equivalents                                                2,000
Deferred consideration                                                   3,400
                                                                         5,400
Profit on disposal of discontinued operations before taxation           $1,157





The gain on discontinued operations on the Statement of Comprehensive Income
can be analysed as follows:



                                                             Six months ended
                                                                      30 June
                                                                         2012
                                                                        $'000

                                                                  (Unaudited)
Gain recognised on disposal of net assets less costs to sell           $1,157
Income tax payable                                                      (347)
Profit on disposal of discontinued operations, net of tax                 810





The Statement of Cash Flows contains the following elements related to
discontinued operations:



                                                                 Twelve months
                                                                         ended
                              Six months ended  Six months ended   31 December
                                       30 June           30 June          2011
                                          2012              2011         $'000
                             $'000 (Unaudited) $'000 (Unaudited)     (Audited)
Net cash flows  attributable 
to investing activities:
Expenditure  on   intangible          $(1,172)            $(712)        $(393)
assets
Proceeds    on    sale    of             2,000                 _         2,000
non-current assets
Net Cash  flow  attributable               828             (712)         1,670
to investing activities



There  were  no  cash  flows  from  discontinued  operations  attributable  to 
operating or financing activities.



5. Earnings per share

Basic earnings per  share amounts are  calculated by dividing  profit for  the 
period attributable to ordinary equity holders  of the parent by the  weighted 
average number of ordinary shares outstanding for the period.



Diluted earnings per share amounts are  calculated by dividing the profit  for 
the period  attributable to  ordinary  equity holders  of  the parent  by  the 
weighted average number of ordinary shares outstanding during the period  plus 
the weighted average  number of ordinary  shares that would  be issued on  the 
conversion of all the dilutive potential ordinary shares into ordinary shares.
The calculation, of the dilutive potential ordinary shares related to employee
and Director share  option plans,  includes only those  options with  exercise 
prices below the average share trading price for each period.





The following reflects the profit and share data used in the basic and diluted
earnings per share calculations:

                                                                 Twelve months
                            Six months ended  Six months ended           ended

                                     30 June           30 June     31 December

                                        2012              2011            2011

                           $'000 (Unaudited) $'000 (Unaudited) $'000 (Audited)
Profit   from   continuing             1,194             3,875           1,996
operations after taxation
Profit  from  discontinued               810                 -               -
operations after taxation
Net profit attributable to             2,004             3,875           1,996
equity  holders  used   in 
dilutive calculation
Earnings  per  Share   for 
continuing operations
- Basic                                $0.03             $0.11           $0.06
- Diluted                              $0.03             $0.10           $0.05
Earnings  per  Share   for 
discontinuing operations
- Basic and Diluted                    $0.02                $-              $-
Total Earnings per Share
- Basic                                $0.05             $0.11           $0.06
- Diluted                              $0.05             $0.10           $0.05
Basic   weighted   average        35,855,076        35,766,774      35,752,049
number of shares
Dilutive         potential 
ordinary shares
 Employee   and   Director         1,416,998         1,439,072       1,536,620
share option plans
Diluted  weighted  average        37,272,074        37,205,846      37,288,669
number of shares





Figures in thousand except for per share information.



The calculation of  the diluted EPS  assumes all criteria  giving rise to  the 
dilution of  the EPS  are  achieved and  all  outstanding share  options  with 
exercise prices lower than the average period share price are exercised.



6. Intangible Assets

The remaining  balance in  intangible  assets at  30  June 2012  is  primarily 
related to  the costs  of the  upgrade  in the  Group's accounting  system  to 
SAP-ERP.



7. Convertible loan notes

On 3 February 2012, the Group  irrevocably exercised its option to redeem  all 
of the outstanding  ($9,561,000) principal  amount of  its remaining  Variable 
Coupon Convertible Notes Due 2012 (the "Convertible Notes") of the Company  on 
5 March 2012 (the "Redemption Date"). The Notes were redeemed for cash at  the 
principal amount  of the  Notes  together with  interest  accrued up  to  (but 
excluding)  the  Redemption  Date.  The  Convertible  Notes  have  been  fully 
extinguished and are no longer outstanding.



8. Long-term and short-term loans payable

On 31 January 2012, the Group closed a Fixed Rate Note Payable with HKN,  Inc. 
("HKN") for the principal amount of $12 million (the "Note Payable"). The Note
Payable is not  convertible into  shares and  allowed for  the full  principal 
amount to be  available to  the Company  from the  date of  closing. The  Note 
Payable is subject to an interest charge  of 10.5 per cent per annum,  payable 
quarterly in arrears, with the principal amount being repayable in full on  30 
September 2013. The Note Payable is  currently unsecured, but HKN can  require 
Global to provide  adequate collateral  security in  the event  of a  material 
adverse effect. The Company also paid to  HKN a 1.75 per cent transaction  fee 
of approximately  $210,000. The  Company  used these  proceeds to  redeem  and 
extinguish the remaining $9.5 million principal amount (and accrued  interest) 
of its  Convertible Notes  and  to accelerate  development activities  at  its 
existing properties within Colombia.



On 30 August  2012, the  Group, as borrower,  signed an  amendment (the  "Loan 
Amendment") to the  Senior Secured Note  Payable for $5  million entered  into 
with HKN, as  lender, on 14  September 2010. The  Loan Amendment extended  the 
maturity date of the  underlying repayment obligation  from September 2012  to 
April 2013. In exchange for this extension, the Company agreed to increase the
interest rate from 10.5 per cent per annum  to 12.5 per cent per annum and  to 
pay a one-time 1 per cent transaction fee of $50,000 (see Note 13 - Subsequent
events).



9. Tax credit/(expense)

The Global  Energy  Development PLC  Group  is  subject to  UK  and  Colombian 
taxation.



UK taxation

The Company  does not  expect  to be  liable for  UK  corporation tax  in  the 
foreseeable future  due to  Global  trading losses  brought forward  of  $28.5 
million as at 31 December 2011. These trading losses are expected to  increase 
in the future.



Colombian taxation

The Group pays taxes in Colombia through the branch office of its wholly-owned
subsidiary CEDCo. The Colombian corporation tax is calculated as the higher of
net income tax or presumptive income tax which are determined as follows:



· Presumptive income  tax. An  alternative minimum tax  calculated on  the 
prior year gross equity less liabilities at a rate of 3 per cent to  determine 
the presumptive income. A rate  of 33 per cent  is applied to the  presumptive 
income to arrive at the tax obligation; or

· Net income tax. Calculated at a rate of 33 per cent taking into  account 
revenues minus costs, standard deductions and special deductions.



Currently, CEDCo pays its income tax based on Presumptive Income Tax.



Additionally, the Group pays an Equity Tax calculated using a taxable base  of 
the Net Equity as at 1  January 2011 at a rate of  6 per cent. The payment  of 
the tax is being made over four years with payments made twice per year.





The major components of income tax expense for the periods ended 30 June  2012 
and 2011 as disclosed  in the Consolidated  Statement of Comprehensive  Income 
are:



                                                   30 June 30 June 31 December
                                                      2012    2011        2011
                                                     $'000   $'000       $'000
Current taxes for continuing operations:
Current   income   tax   charge   for   continuing     164     139         256
operations
Current equity tax                                       -     859       1,549
Others withholdings                                     58      40          51
Total current taxes for continuing operations          222   1,038       1,856
Deferred Tax:
Change  in  deferred  tax  related  to   temporary   (181) (2,270)       2,082
differences and other
Tax expense/(credit) for continuing operations          41 (1,232)       3,938
Tax expense for discontinued operations                347       -           -



10. Deferred tax liabilities (net)

The Group offsets tax assets and liabilities if, and only if, it has a legally
enforceable right to offset current tax assets and current tax liabilities and
the deferred tax assets  and deferred tax  liabilities related to  corporation 
taxes levied by the  same tax authority. Deferred  tax assets and  liabilities 
listed are related to  corporation tax levied by  the Colombian tax  authority 
with jurisdiction over CEDCo.



Temporary differences between the tax bases and net book carrying values arise
in relation  to  the  effect  of inflation  adjustments,  the  differences  in 
exchange rate of non-monetary assets,  differences between tax and  accounting 
depreciation, the balance of presumptive income tax excesses generated and tax
losses generated in prior years.



The changes in net deferred tax liabilities are reported as follows:



Deferred tax liabilities (net)



                                                   30 June 30 June 31 December
                                                      2012    2011        2011
                                                     $'000   $'000       $'000
Opening balance of deferred tax liabilities (net) (10,116) (8,034)     (8,034)
Change  in  deferred  tax  related  to  temporary      180   2,270     (2,082)
differences and other
Ending balance of deferred tax liabilities (net)   (9,936) (5,764)    (10,116)



                                30 June  30 June 31 December
                                   2012     2011        2011
                                  $'000    $'000       $'000
Deferred tax assets              14,061   17,913      14,274
Deferred tax liabilities       (23,997) (23,677)    (24,390)
Deferred tax liabilities (net)  (9,936)  (5,764)    (10,116)





The effect of this net deferred  income tax ("DIT") movement on the  condensed 
consolidated statement of  comprehensive income  was a  tax benefit  resulting 
from an  overall decrease  in the  net  deferred tax  liabilities due  to  the 
following:



· DIT  asset  decreased due  to  the Colombian  peso  (COP) to  US  dollar 
exchange rate effect (Dec 2011: COP$ 1,942 per $1 and June 2012: COP$1,784 per
$1) and the estimated use of tax  losses carried forward into the 2011  income 
tax return.

· DIT  liability decreased  due to  the peso-dollar  exchange rate  effect 
mentioned above  causing on  overall  net decrease  in deferred  taxes).  Even 
though there was an important increase to the decommissioning accrual  (approx 
$835 thousand) in the first semester, the impact of the exchange rate did  not 
significantly change the basis for DIT liability.



At the end of each reporting period, the temporary differences (denominated in
COP) must be translated to USdollars.  A further fluctuation in the  exchange 
rate (COP vs. USD) as of 31  December 2012 could cause the calculation of  the 
net deferred tax liabilities  to change significantly.  If the Colombian  peso 
appreciates against the US dollar as of  31 December 2012 compared to 30  June 
2012, the Group may be required  to recognise a significant tax expense  (i.e. 
net increase in deferred tax  liability) that is not  reflected as of 30  June 
2012.



11. Interim dividend

No interim dividend has been declared.



12. Share capital

                         Six months ended Six months ended Twelve months ended
                           30 June 2012     30 June 2011    31 December 2011
                           (Unaudited)      (Unaudited)         (Audited)
                           Number           Number            Number
                         of shares  $'000 of shares  $'000  of shares   $'000
Allotted, called up  and 
fully paid
Ordinary  shares  of  1p 36,044,657   549 35,766,774   545   35,752,049    546
each



The ordinary  shares confer  the right  to  vote at  general meetings  of  the 
Company, to a repayment of capital in  the event of liquidation or winding  up 
and certain other rights as set out in the Company's articles of association.



The ordinary shares also confer the right to receive dividends if declared  by 
the Directors and approved by theCompany.



On 4 January  and 14  May 2012,  following notices  of exercise  of option  in 
respect of 22,981 and 254,902 respectively, ordinary shares of 1p each in  the 
Company, the Company issued a total of 277,883 ordinary shares to ex-employees
of the Company.





13. Subsequent events

On 30 August 2012, the  Group agreed to an extension  of the maturity date  of 
its Senior  Secured Note  Payable with  HKN  for the  principal amount  of  $5 
million. The  maturity date  of the  Note Payable  has been  extended from  14 
September 2012 to 14 April 2013.  In exchange for this extension, the  Company 
agreed to increase  the interest charge  by 2 per  cent to 12.5  per cent  per 
annum with effect from  the date the extension  was granted. The Company  also 
paid to HKN a one-time 1 per cent transaction fee of $50,000.



Under the terms of the Fixed Rate  Note Payable issued on 31 January 2012  for 
the principal amount of  $12 million, the stated  interest charge of  10.5per 
cent per  annum, payable  quarterly  in arrears,  is contingent  upon  certain 
results reported in this interim report.  The interest rate terms of the  Note 
Payable state that in  the event of  a decrease in  the Company's profit  from 
operations or cash flow  from operations as  of 30 June  2012 compared to  the 
prior period, the interest  rate shall immediately be  adjusted from 10.5  per 
cent to 12.5 per cent per annum  from the date of publication of this  interim 
report and through the maturity date of the Note Payable. Based on the results
of this period, the interest  rate shall be increased 2  per cent to 12.5  per 
cent effective immediately.



                     This information is provided by RNS
           The company news service from the London Stock Exchange

END


IR SEEESIFESEEU -0- Sep/26/2012 06:00 GMT
 
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