Estimates of the Petrolifera’s reserves are prepared by GLJ Petroleum Consultants of Calgary, Alberta (“GLJ”). The most recent update is from a report with an effective date of December 31, 2009 (“GLJ 2009 Report”).
The GLJ 2009 Report and the estimates provided herein were prepared using assumptions and methodology guidelines outlined in the Canadian Oil and Gas Evaluation Handbook (“COGE Handbook”) and in accordance with National Instrument 51-101 (“NI 51-101”). The GLJ 2009 Report was prepared utilizing the GLJ January 1, 2010 price forecast, effective December 31, 2009 and adjusted to Petrolifera’s asset mix and specific pricing circumstances in Argentina and in Colombia. In the GLJ 2009 Report, future net revenue is calculated after deduction of forecast royalties, operating expenses, capital expenditures and well abandonment costs but before corporate overhead or other indirect costs, including interest and income taxes. The pre-tax present value of future net revenue (“present value”) is calculated by GLJ using various discount rates; this website will provide undiscounted future net revenue and the 10 percent present value thereof.
All references to barrels of oil equivalent (“boe”) are calculated on the basis of 6 mcf: 1 bbl. Readers are cautioned that the conversion used in calculating barrels of oil equivalent is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Furthermore, boe may be misleading if used in isolation. Future net revenues disclosed herein do not represent fair market value. Also, estimations of reserves and future net revenue discussed on this web page constitute forward-looking information. See Forward Looking Information disclaimer.
Reserve Volumes and Values
The following tables summarize the reserves estimates. Tables may not add due to rounding.
| Crude Oil, NGL and Natural Gas Reserves (1)(2)(3)(4)(5) | |||
|---|---|---|---|
|
31-Dec-09 |
OIL & NGLs |
NATURAL GAS |
BOE's |
|
Total Proved (1P) |
7,666 |
8,245 |
9,040 |
|
Total Probable |
6,189 |
7,684 |
7,469 |
|
Total Proved plus Probable (2P) |
13,855 |
15,929 |
16,510 |
|
Total Possible |
5,941 |
12,885 |
8,089 |
|
Total Proved plus probable plus possible (3P) |
19,797 |
28,814 |
24,599 |
|
Before Tax Present Value at 31-Dec-09 |
||
|---|---|---|
|
Before Tax Present Value of Future Net Revenue (1)(2)(3)(4)(5) |
Undiscounted |
Discounted at 10% |
|
Total Proved (1P) |
215,840 |
155,675 |
|
Total Probable |
209,725 |
101,576 |
|
Total Proved plus Probable (2P) |
425,566 |
257,252 |
|
Total Possible |
255,796 |
122,345 |
|
Total Proved plus probable plus possible (3P) |
681,362 |
379,595 |
Notes:
| (1) | Proved reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. There is at least a 90% probability that the actual quantities recovered will equal or exceed the estimated proved reserves. |
| (2) | Probable reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves. |
| (3) | Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is at least a 10% probability that the quantities actually recovered will be equal to or exceed the sum of proved plus probable plus possible reserves. At December 31, 2009 there are 5.9 million barrels of possible oil and NGL reserves, 12.9 Bcf of possible natural gas reserves for a total of 8.1 million boe on an equivalent basis. |
| (4) | Reserve volumes, future net revenue and pre-tax present value of future net revenue do not include undeveloped land or the value of drilling opportunities in Argentina, Colombia or Peru. |
| (5) | Reserves are company working interest reserves before royalty. |
The volume of possible reserves estimated at 8.1 million boe underscores continuing recognition of the development potential for both crude oil and natural gas of the lands reviewed in the GLJ 2009 Report, which included the La Pinta prospect in Colombia and the Puesto Morales/Rinconada Concession in Argentina. These estimates did not include a review of the company’s undeveloped exploratory concessions or the value of drilling opportunities at Vaca Mahuida, Gobernador Ayala II and Puesto Guevara in Argentina nor of Petrolifera’s exploratory holdings or drilling opportunities, except for the La Pinta prospect, in Colombia and none of the company’s extensive holdings in Peru.