Emerald Energy Plc - 22 September 2003

Emerald Energy Plc: Interim Report for the half year ended 30 June 2003

Chairman's Statement

In the period under review, the Company has continued to derive all of its revenue from exploitation of Gigante #1A well in the Matambo Block.  On 21 July 2003, the Company announced that it proposed to raise £6.8 million (before expenses) by way of a transaction involving a Rights Issue and an Issue for Cash.  This transaction was completed in September 2003.

Results
The results of the Company for the half-year ending 30 June 2003 show a net loss of £0.1 million compared with a loss of £2.4 million for the half-year ended 30 June 2002 (please refer to Note 3 to the unaudited interim accounts).  The Group currently pays no UK corporation tax, having tax losses brought forward from previous years.

Group attributable production for the first six months of this year totalled 123,607 barrels of oil (compared with 70,000 barrels of oil equivalent, reported for the same period of last year) producing revenue of £1.8 million (compared with £1.0 million in the same period of last year) (please refer to Note 2 to the unaudited interim accounts).  The average price received was US$24 per barrel (compared with US$22 per barrel in the same period of last year).  Cost of sales amounted to £0.9 million (£0.9 million before exceptional items in the same period of last year), resulting in a gross profit of £0.9 million (compared with gross profit of £0.1 million before exceptional items in the same period of last year).

Board Changes
John Silcock retired from the Board at the AGM held on 15 August 2003.  Graeme Elliot, Iain Alexander, Alan Brooks and Alan Lucas resigned from the Board immediately after the EGM held on the same day subsequent to the earlier AGM.

Alastair Beardsall, Edward Grace, Merfyn Roberts and Fred Ponsonby became Directors of the Company on 15 August 2003.

Outlook
After a difficult period the prospects for the Group are clearly improving.  Having successfully raised £6.8 million (before expenses), the Company now has sufficient funds to pursue the existing low cost opportunity of Campo Rico.  The Company is preparing to drill the first well in the Campo Rico Association Contract area and is working with Ecopetrol to identify further new opportunities inside Colombia.

Alastair Beardsall
Chairman
22 September 2003

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