SAN FRANCISCO, March 23, 2011 /PRNewswire/ -- GeoPetro Resources Company (NYSE Amex: GPR) ("GeoPetro", "we", "our" or the "Company") is pleased to announce that its wholly-owned, indirect subsidiary, Madisonville Midstream LLC ("MML"), has entered into an amendment with Bank of Oklahoma, National Association whereby the maturity date on its Term Loan has been extended by one (1) year, from December 31, 2011 to December 31, 2012. The Term Loan, which had an initial principal balance of approximately $7.7 million, has been paid down by MML to its current principal balance of approximately $4.6 million. In addition to the extension of the maturity date, the amendment reduced the per annum interest rate by three-quarters of one per cent (3/4%) to LIBOR plus four and three-quarters percentage points (4 3/4%) per annum. Based on the current LIBOR rate, this rate of interest is approximately five per cent (5%) per annum. MML also renegotiated the option to elect a Prime Interest Rate calculation (instead of the "LIBOR plus" election) which has also been reduced by three quarters of one per cent (3/4%) per annum to Prime Rate plus three and one-quarter percentage points (3 1/4%) per annum.
In addition to the above extension with Bank of Oklahoma, National Association, the Company has also successfully negotiated the extension of certain promissory notes with private parties totaling approximately $1.5 million by one (1) year, with maturity dates extending into 2012 and 2013.
Addressing the loan extensions, GeoPetro's President and CEO, Stuart J. Doshi commented "We are particularly pleased with the extension of the Term Loan facility with Bank of Oklahoma, National Association and the promissory notes with certain private parties. The loan extensions significantly improve the Company's balance sheet and liquidity. These modifications also position the Company to continue its strategic goals of enhancing production and securing a farm-out partner in the drilling of a deep well to test six (6) highly prospective zones in the Madisonville Project. The 3D seismic shows a very attractive structural closure with a high potential for a major discovery."
The Madisonville structure has been a prolific producer of oil and natural gas. The Rodessa and shallower zones have to date produced in excess of 30 million barrels of oil and 100 billion cubic feet of natural gas. The six (6) zones below the Rodessa Formation have potential recoverable reserves of approximately one (1) trillion cubic feet of natural gas.
GeoPetro is an independent oil and natural gas company headquartered in San Francisco, California. GeoPetro currently has projects in the United States, Canada and Indonesia. GeoPetro has developed a producing oil and gas property in its Madisonville Field Project in Texas. Elsewhere, GeoPetro has assembled a geographically-diversified portfolio of exploratory and appraisal prospects.
This news release contains forward-looking information. Statements contained in this news release relating to future results, events and expectations are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may involve known and unknown risks involving market prices for natural gas and oil, economic and competitive conditions, regulatory changes, resource estimates, estimates of proved and probable reserves, production forecasts, geological and engineering uncertainties, potential failure to achieve production from development drilling projects, capital expenditures and other risks and uncertainties, which may cause the actual results to be materially different from those expressed or implied by such statements. Additional risk factors include, among others, those described in the Company's Annual Report on Form 10-K on file with the U.S. Securities and Exchange Commission. We do not have any intention or obligation to update forward-looking statements included in this press release after the date of this press release, except as required by law.
No stock exchange or regulatory authority has approved or disapproved of the information contained herein.
SOURCE GeoPetro Resources Company