(24/05/07) Operational Update

For Immediate Release

24 May 2007

GTL Resources plc

("GTL" or the "Company")

 

Operational Update

 

GTL Resources plc (AIM:GTL), the project development company focused on ethanol production in the US, is pleased to provide an update on its US plant's operational and commercial performance following a successful first quarter to 31 March 2007.

 

Production at the 50 million gallon per annum plant commenced on 27 December 2006. Plant acceptance tests were passed in January 2007 and, although a cautious and safe approach to building up the plant's run rates was undertaken, the run rates during the first quarter of 2007 nonetheless gave production of 94% of nameplate capacity. This was above the planned 90% target.

 

Building from this strong base, production in the second quarter of 2007 (April - June) to date has averaged above 110% of nameplate production capacity.

 

Corn prices have been particularly volatile during the period of operations and, as previously announced, the Company has taken steps to secure a proportion of its corn and ethanol prices in advance. The Company's risk management strategy includes securing an ethanol margin over corn which means that the commodity prices of corn and ethanol should not be viewed individually but should be judged in conjunction with each other.

 

During the first quarter, GTL achieved an average corn purchase price of below $3.20 per bushel versus a Chicago Board Of Trade (CBOT) front month futures average of $4.01 per bushel, and the Company's average ethanol sales price of approximately $1.97 per gallon compared to a freight adjusted CBOT front month futures average of $2.10 per gallon.

 

The net impact was that the Company secured an ethanol margin over corn of around $0.84 per gallon ethanol (calculated as ethanol minus corn divided by 2.8), versus the comparable CBOT figure of $0.67 per gallon.

 

Peter Middleton, Chairman of GTL, commented:

"Whilst it remains early days for production at our ethanol plant, we are happy to announce that we are continuing our record of delivery with a profitable first quarter's operations.

 

The strong production performances at our ethanol plant to date are extremely pleasing and such rates augur well for future production and reinforce our confidence in the proposed expansion of Rochelle.

 

The Company will continue to strive for operational excellence in a safe and responsible manner."

 

For further information, please contact:

GTL Resources plc

Peter Middleton, Executive Chairman Tel: 020 7958 1685

Michael Brennan, Finance Director Tel: 01642 794 000

Buchanan Communications Tel: 020 7466 5000 Charles Ryland/Nick Melson/ Ben Romney

 

 

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