Heritage Oil Reserve Update
By John Lee.
Heritage Oil, an independent upstream exploration and production company, has announced the publication of an independent Competent Person’s Report (“CPR”) compiled by industry specialists RPS Energy Consultants Limited (“RPS”).
Trading in the company’s shares remain suspended pending an acquisition.
On 29June 2012, Heritage announced the proposed acquisition of a major interest in Oil Mining Lease 30 in Nigeria (“OML 30″) and this CPR has been commissioned to provide independent reserve and resource information and a valuation of OML 30, together with an update on certain existing assets in Heritage’s portfolio.
The range of reserves and resources is as at 31 March 2012 and is based on the data and information available up until that date. The CPR assumes that the acquisition of OML 30 completes on 1 September 2012. All volumes are stated net of royalties unless otherwise stated.
· OML 30, Nigeria;
- Gross Proved plus Probable reserves(1): 1,114 million barrels, 58% higher than management estimates as set out in the announcement issued by the Company on 29 June 2012
- Proved plus Probable net entitlement reserves to Heritage: 396 million barrels of oil
- Economic valuation of Proved plus Probable reserves estimated at between US$3,089 million and US$3,789 million, depending on the income tax scenario (post-tax, net Heritage share, assuming a 10% discount rate)
· Zapadno Chumpasskoye Field, Russia;
- Proved plus Probable net entitlement reserves to Heritage: 65 million barrels of oil
- Economic valuation of Proved plus Probable reserves estimated at $336 million (post-tax, net Heritage share, assuming a 10% discount rate)
· Miran Field, Kurdistan Region of Iraq (“Kurdistan”);
- Contingent Resources – mean estimate of Heritage working interest of 56.25%, gross of royalty: 366 million barrels of oil equivalent, comprising 53 million barrels of oil and condensate and 1,815 billion cubic feet of gas, resulting in a mean net entitlement volume to Heritage of 136 million barrels of oil equivalent
- 2C estimate of net entitlement to Heritage of Contingent Resources: 130 million barrels of oil equivalent, comprising 15 million barrels of oil and condensate and 669 billion cubic feet of gas based on Heritage interest of 56.25%
- Prospective Resources – mean(2) un-risked estimate of working interest of 56.25% to Heritage, gross of royalty: 142 million barrels of oil equivalent, comprising 96 million barrels of oil, 256 billion cubic feet of gas and condensate of 3.1 million barrels
(1) Full field (100% basis) gross of royalty
(2) The mean is a statistical aggregate which assumes that each of the three prospects is successful. The probability of this occurring is 3% for the oil and 12% for the non-associated gas and condensate.