Shares in Trinidad-fo­cused oil firm Bay­field En­er­gy rose near­ly eight per cent yes­ter­day on the Lon­don Stock Ex­change yes­ter­day af­ter the com­pa­ny an­nounced that it had rene­go­ti­at­ed its con­tract with state-owned Petrotrin. Ac­cord­ing to a re­port on the ProAc­tive In­vestors Web site, Bay­field En­er­gy said out­put from the Trintes field is to be bench­marked against the high­er val­ue Brent price rather than West Texas In­ter­me­di­ate, af­ter it re-ne­go­ti­at­ed its con­tract. In a state­ment yes­ter­day, Bay­field said it first en­tered in­to a con­tract for the sale of its crude oil with Petrotrin in April 2009, which set the sales price at a 17.5 per cent dis­count to the pub­lished price for West Texas In­ter­me­di­ate ("WTI") crude, a com­mon­ly used mark­er for crude sales in the Caribbean mar­ket.

Bay­field said: "The dis­count of 17.5% re­flect­ed the low vol­umes pro­duced by Bay­field at that time of around 600 bar­rels of oil per day (bopd). The ne­go­ti­a­tions lead­ing to the re­vised con­tract terms have recog­nised that de­vel­op­ments in crude mar­kets have re­sult­ed in a sit­u­a­tion where the use of WTI as a ref­er­ence price no longer fair­ly re­flects the mar­ket val­ue of Bay­field's crude and al­so ac­knowl­edged sig­nif­i­cant in­creas­es in pro­duc­tion from the Trintes field." Ac­cord­ing­ly, Bay­field and Petrotrin "have agreed up­on re­vised pric­ing terms for Bay­field's crude such that the sales con­tract will adopt Brent crude as the ref­er­ence price and a re­vised dis­count of 9.5 per cent for a min­i­mum pe­ri­od of 12 months. The re­vised terms are ef­fec­tive from Au­gust 1. Brent has been trad­ing re­cent­ly at a pre­mi­um to WTI of around US$20.00 per bar­rel," ac­cord­ing to the oil com­pa­ny's state­ment.

In a state­ment in Ju­ly, the com­pa­ny said that the lat­est re­port­ed pro­duc­tion rate from the Trintes field has now in­creased to over 2,300 bopd. Bay­field's chief ex­ec­u­tive, Hy­wel John, said: "It is en­cour­ag­ing to re­port on the suc­cess of our ini­tia­tives to im­prove cash flow and man­age our fi­nan­cial com­mit­ments to en­able us to es­tab­lish a sound plat­form from which to con­tin­ue our ex­plo­ration pro­gramme." ProAc­tive In­vestors quot­ed stock­bro­ker Sey­mour Pierce not­ed that it had pre­vi­ous­ly used a West Texas In­ter­me­di­ate (WTI) price of be­tween US$75.7 and US$85.6 per bar­rel in its cash flow analy­sis of the firm. The new sales agree­ment in this long-await­ed up­date us­ing Brent equates to an ad­di­tion­al 8.2 pence a share on its pre­vi­ous fore­casts, it said in a note. Bay­field shares were up 7.83 per cent this af­ter­noon, at 31 pence each.an up­stream oil and gas ex­plo­ration and pro­duc­tion

Bay­field has in­ter­ests off­shore Trinidad and South Africa.