Mr. Richard Walls reports
MAPAN ENERGY LTD. ANNOUNCES 2014 YEAR-END RESERVES, OPERATIONS UPDATE AND EXECUTIVE APPOINTMENT
Mapan Energy Ltd. has released its 2014 year-end reserves. Mapan's independent reserve report was prepared by GLJ Petroleum Consultants in accordance with National Instrument 51-101 (standards of disclosure for oil and gas activities) with an effective date of Dec. 31, 2014.
Highlights:
- The company's proved reserves increased from the March 31, 2014, report
by 19 per cent from 12.58 million barrels of oil equivalent to 15
million boe at year-end Dec. 31, 2014.
- Proved plus probable reserves increased by 27 per cent from 15.16 million boe to
19.18 million boe.
- Proved producing reserves are 12.64 million boe. Proved producing reserves
represent 84 per cent of all proved reserves and 66 per cent of all proved plus probable reserves.
- Technical revisions increased proved reserves by 2.42 million boe. The
majority of the upward technical revisions is due to improved
performance of the producing wells.
- The net present value of future net revenue attributable to the reserves
(before tax) discounted at 10 per cent is $117.6-million for the proved reserves and
$144.5-million for the proved plus probable reserves.
- The undiscounted, total future development capital for the proved plus
probable reserves is $34.0-million.
- The company's proved and proved plus probable reserves are composed of
94 per cent natural gas and 6 per cent oil and natural gas liquids.
- The reserves are based on the independent reserve report prepared by GLJ, effective March 31, 2014, in respect of the reserves
acquired by the company on the acquisition of
certain oil and natural gas properties on July 31, 2014. Unlike the GLJ report, the reserves in the March report do not
include relatively minor reserves attributable to the properties that
were held by the company prior to the acquisition.
Operations
On Jan. 20, 2015, shut-in production from Mapan's properties in the Deep basin north, processed at the Elmworth gas plant, came back on-line as Trans Canada Pipeline lifted production restrictions on its natural gas transmission pipeline system at Elmworth and put back into service a 30-inch pipeline in this area. Company production of approximately nine million cubic feet per day (1,500 barrels of oil equivalent per day) had been shut in for 137 days due to this outage on NGTL. Mapan's current production is approximately 6,100 boe per day. Approximately 600 to 700 boe per day remain shut in due to current, continuing inspections, repairs and outages on the NGTL system, well downstream of Mapan's producing properties. These new production restrictions on the NGTL system are expected to last several weeks.
SUMMARY OF OIL AND GAS RESERVES
Effective date: Light and medium Natural gas Total oil
Dec. 31, 2014 oil liquids Natural gas equivalent
Gross Net Gross Net Gross Net Gross Net
Reserve category (Mbbl) (Mbbl) (Mbbl) (Mbbl) (MMcf) (MMcf) (Mboe) (Mboe)
Proved
Developed
producing 56 43 556 365 72,141 65,612 12,635 11,343
Developed non-
producing -- -- 53 38 2,549 2,345 478 429
Undeveloped -- -- 209 164 10,082 9,577 1,889 1,760
Total proved 56 43 818 567 84,772 77,534 15,002 13,533
Probable
Total probable 18 13 264 185 23,351 21,382 4,174 3,762
Total proved plus
probable 74 57 1,082 752 108,123 98,916 19,176 17,295
SUMMARY OF NET PRESENT VALUE OF FUTURE NET REVENUE
Before income tax discounted at (%/yr)
0% 5% 10% 15% 20%
Reserve category (M$) (M$) (M$) (M$) (M$)
Proved
Developed producing $174,224 $137,649 $113,223 $96,097 $83,574
Developed non-producing 4,815 3,541 2,649 2,011 1,544
Undeveloped 15,540 6,781 1,696 -1,416 -3,405
Total proved 194,578 147,971 117,568 96,692 81,712
Probable
Total probable 73,949 42,564 26,975 18,466 13,426
Total proved plus probable 268,527 190,535 144,542 115,157 95,139
After income tax discounted at (%/yr)
0% 5% 10% 15% 20%
Reserve category (M$) (M$) (M$) (M$) (M$)
Proved
Developed producing $160,047 $126,754 $104,588 $89,075 $77,738
Developed non-producing 3,589 2,584 1,875 1,367 995
Undeveloped 12,271 4,763 405 -2,262 -3,968
Total proved 175,908 134,102 106,869 88,180 74,765
Probable
Total probable 57,913 32,787 20,483 13,844 9,949
Total proved plus probable 233,821 166,888 127,352 102,024 84,715
RECONCILIATION OF GROSS RESERVES (BEFORE ROYALTIES)
BY PRINCIPAL PRODUCT TYPE
Light and medium oil Natural gas
Proved + Proved +
Proved Probable probable Proved Probable probable
Factors (Mbbl) (Mbbl) (Mbbl) (MMcf) (MMcf) (MMcf)
March 31, 2014 76 30 106 71,875 14,692 86,567
Technical revisions -9 -12 -21 13,043 3,208 16,251
Infill drilling -- -11 -11 10,082 5,452 15,534
Production -11 11 -- -10,228 -- -10,228
Dec. 31, 2014 56 18 74 84,772 23,351 108,123
Natural gas liquids Total oil equivalent
Proved + Proved +
Proved Probable probable Proved Probable probable
Factors (Mbbl) (Mbbl) (Mbbl) (Mboe) (Mboe) (Mboe)
March 31, 2014 524 101 625 12,579 2,579 15,158
Technical revisions 160 50 211 2,325 573 2,898
Infill drilling 209 113 322 1,889 1,022 2,911
Production -76 0 -76 -1,791 0 -1,791
Dec. 31, 2014 818 264 1,082 15,002 4,174 19,176
Pricing
GLJ employed pricing, exchange rate and inflation rate assumptions as of Dec. 31, 2014, in the GLJ report in estimating the net present value of the future net revenue attributable to the reserves. Actual wellhead prices received by the company may vary due to transportation charges and product quality adjustments.
PRICING, EXCHANGE RATE AND INFLATION RATE
Pen-
Pro- tanes
Natural gas Light crude oil pane Butane plus
Henry Edmon- Edmon- Edmon- Edmon- Infla- Ex-
Hub AECO WTI ton ton ton ton tion change
Year rates rate
forecast ($U.S./ ($Cdn/ ($U.S./ ($Cdn/ ($Cdn/ ($Cdn/ ($Cdn/ (%/ ($U.S./
MMBtu) MMBtu) bbl) bbl) bbl) bbl) bbl) year) $Cdn)
2015 $3.31 $3.31 $62.50 $64.71 $19.63 $52.91 $69.24 2.0 $0.850
2016 3.75 3.77 75.00 80.00 32.00 60.80 85.60 2.0 0.875
2017 4.00 4.02 80.00 85.71 38.57 65.14 91.71 2.0 0.875
2018 4.25 4.27 85.00 91.43 41.14 69.49 97.83 2.0 0.875
2019 4.50 4.53 90.00 97.14 43.71 73.83 103.94 2.0 0.875
2020 4.75 4.78 95.00 102.86 46.29 78.17 110.06 2.0 0.875
2021 5.00 5.03 98.54 106.18 47.78 80.70 113.62 2.0 0.875
2022 5.25 5.28 100.51 108.31 48.74 82.31 115.89 2.0 0.875
2023 5.50 5.53 102.52 110.47 49.71 83.96 118.20 2.0 0.875
2024 5.68 5.71 104.57 112.67 50.70 85.63 120.56 2.0 0.875
There-
after +2%/yr +2%/yr +2%/yr +2%/yr +2%/yr +2%/yr +2%/yr 2.0 0.875
Corporate presentation
Mapan has updated its corporate presentation to reflect the year-end 2014 reserves, which can be found on its website.
Executive appointment
Mapan is pleased to announce the appointment of Colin Taylor to the position of vice-president, land. Mr. Taylor has over 10 years of industry experience and will be a key addition to the Mapan team.
We seek Safe Harbor.
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