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Rok Resources Inc
Symbol ROK
Shares Issued 59,071,576
Close 2021-02-24 C$ 0.185
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Rok Resources' 2020 NI 51-101 reserves at 1.4 MMboe P+P

2021-02-25 00:19 ET - News Release

Mr. Cam Taylor reports

ROK ANNOUNCES 2020 YEAR-END RESERVES

Rok Resources Inc. has released the results of its Dec. 31, 2020, independent reserves evaluation. The evaluation for the company as at Dec. 31, 2020, was conducted by GLJ Ltd. of Calgary, and was conducted in accordance with the definitions, standards and procedures contained in the Canadian oil and gas evaluator handbook (COGEH) and National Instrument 51-101 (Standards for Disclosure of Oil and Gas Activities). Please note that bopd refers to barrels of oil per day. Reserves volumes reported are total company interest reserves, a classification of reserves used in the evaluation, which represents production and reserves before deduction of royalties.

Commenting on the year-end 2020 reserve report, chairman and chief executive officer Cam Taylor stated: "We are very pleased with the year-end 2020 independent reserves evaluation for the Glen Ewen property. Rok's technical team's expertise in identifying potential upside, combined with the reactivation and recompletion of certain wells, contributed to the reserve bookings. As provided by GLJ at Dec. 31, 2020, proved plus probable reserve bookings totalled 1,409,000 [barrels of oil equivalent], comprised of light and medium crude oil, conventional natural gas, and natural gas liquids as shown in the summary of reserves tables. The associated proved plus probable [net present value] before tax (discounted at 10 per cent) was $12,512,000. Oil pricing has continued to strengthen since the Dec. 31, 2020, independent reserves evaluation date, setting the stage for further operational activity through 2021. Given the improvement in oil pricing, the company will continue to focus on increasing shareholder value through operations in the Glen Ewen area and considering further strategic acquisitions."

In this press release, all references to reserves are to gross company reserves, meaning the company's working interest reserves before deductions of royalties and before consideration of the company's royalty interests. The attached tables are a summary of the company's petroleum and natural gas reserves, as evaluated by GLJ, effective Dec. 31, 2020, using GLJ's year-end forecast prices and costs. It should not be assumed that the estimates of future net revenues presented in the attached tables represent the fair market value of the reserves. There is no assurance that the forecast prices and cost assumptions will be attained, and variances could be material. The recovery and reserve estimates of the company's crude oil, natural gas liquids and natural gas reserves provided herein are estimates only, and there is no guarantee that the estimated reserves will be recovered. It is important to note that the recovery and reserves estimates provided herein are estimates only. Actual reserves may be greater or less than the estimates provided herein. Reserves information may not add due to rounding.

Summary of reserves:

  • Crude oil and natural gas reserves and present values at Dec. 31, 2020, as provided by GLJ:
    • Proven oil and gas reserves (1P) of 742,000 boe and net present value of proven oil and gas reserves, discounted at 10 per cent, of $6,786,000;
    • Proven plus probable oil and gas reserves (2P) of 1,409,000 boe and net present value of proven plus probable oil and gas reserves, discounted at 10 per cent of $12,512,000.

 
                       SUMMARY OF RESERVES AS OF DEC. 31, 2020, AS PROVIDED BY GLJ
                                                                                               
Reserves -- total company interest    Light and medium        Solution gas         Natural gas               Total
                                             oil (Mbbl)              (MMcf)      liquids (Mbbl)              (Mboe)

Proven                                             505                 703                 120                 742
Probable                                           544                 367                  62                 667
                                               -------             -------             -------             -------
Total proven plus probable                       1,049                1071                 182               1,409

                                                                                              
       SUMMARY OF NET PRESENT VALUES AS OF DEC. 31, 2020, AS PROVIDED BY GLJ (BEFORE INCOME TAX)
                                                                                             
Before-tax present value (M$)                  Undiscounted              5%            10%            15%

Proven                                              $12,027         $8,914         $6,786         $5,286
Probable                                             12,857          8,347          5,726          4,064
                                                    -------        -------        -------        -------
Total proven plus probable                           24,884         17,261         12,512          9,350
                                                    -------        -------        -------        -------
Per Rok share -- proven plus probable (note)          $0.42          $0.29          $0.21          $0.16

Note: Per-share values were calculated based on 59,071,576 Rok shares outstanding at Dec. 31, 2020. 

       
       SUMMARY BY AREA OF RESERVES AS OF DEC. 31, 2020, AS PROVIDED BY GLJ 
   
Area reserves -- total company interest    Proven   Probable   Proven plus probable
                                             Mboe       Mboe                   Mboe

Glen Ewen                                     742        667                  1,409
Total                                         742        667                  1,409              

Notes

1. The attached tables have assessed reserves at forecast crude oil reference prices and costs.

2. The U.S.-dollar reference price for crude oil per barrel (U.S.-dollar WTI (West Texas Intermediate) per barrel) is $48 for 2021, $51.50 for 2022, $54.50 for 2023, $57.79 for 2024 and $58.95 for 2025, and prices increase at 2.0 per cent per year thereafter.

3. The attached tables show assessed reserves with a foreign exchange rate of $1 (Canadian) equals 77.5 U.S. cents in 2021, $1 (Canadian) equals 77.5 U.S. cents in 2022 and $1 (Canadian) equals 76.0 U.S. cents for all years thereafter.

4. The capital cost and operating expense inflation rate is 0 per cent per year in 2021, 1 per cent per year in 2022 and 2.0 per cent per year starting in 2023.

5. Estimated future undiscounted development costs, in dollars, at Dec. 31, 2020, were $6.1-million for proven reserves and $12.3-million for proven plus probable reserves.

6. Well abandonment and reclamation costs of $2.1-million for the proven plus probable case were included in this report, and include abandonment and reclamation costs for all existing and future wells assigned reserves in the report.

7. The net present values disclosed may not represent fair market value.

8. Totals may not add exactly due to rounding.

We seek Safe Harbor.

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