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Global Energy in farm-out deal with Gran Tierra Energy

Latin America-focussed petroleum explorer and producer Global Energy Development has agreed to farm-out 60% of its interest in the Peruvian Block 95 licence contract to Gran Tierra Energy.

Global will retain a 40% interest in the Contract through its wholly-owned subsidiary Harken del Peru.

GTE will become the operator of the contract - subject to approval from the Peruvian authorities - and will assume 100% of the costs of an exploration well up to a maximum of $15m.

GTE will also assume its share of the past costs incurred by Global on the contract for $2m.

The contract is currently under force majeure until the final environmental sub-permits are received.

Global anticipates receiving the remaining sub-permits in the first half of 2011 and the exploration well is expected to be drilled before the end of 2011.

Story provided by StockMarketWire.com

13/12/2010