Expect news soon of at least two prospective acquisitions from Texas-based Global Energy Development, to be accompanied by a new share issue, writes Robert Tyerman.

Global (GED), which came to Aim last month at 50p, focuses on oil production and exploration in Latin America. Another US company, Harken Energy, owns 92 per cent of Global, which has six producing assets in Colombia and is developing and exploring projects there and in Peru, Costa Rica and Panama.

Consultants value Global's producing assets at $11 million (£7.9 million), with a combined producing, development and exploration assets total of 100 million barrels, worth a discounted £1 billion. That compares with a market value of £14.5 million at 52.5p a share.

Chairman Mikel Faulkner says Global owns £53.5 million of discounted future cash flow from producing assets. With no debt and cash of £2 million, he expects the company to increase production by 20 per cent this year to 600,000 barrels, to generate about £7 million of revenues and £3.5 million cash flow.

With selling prices of around $25.5 a barrel and costs put at $6 a barrel, Global says it is comfortable with current oil prices. Faulkner maintains the price is ready to motor for a long-term uptrend, after years of exploration cutbacks and high potential demand from developing economies such as China.

He claims Latin America nowadays offers significantly lower costs and political risk than the Middle East – even in Colombia, it seems, contracts are honoured. He argues it is also cheaper than most other parts of the world.

Global is looking at several Latin American acquisitions, which it plans to make with shares and cash. Two could be imminent, to be funded partly by raising cash from investors.

Analysts at house broker Canaccord put a present net asset value of 70p on the shares. Bulls hope Global's Latin American prospects' contacts could one day attract a bid from a larger oil group.