FIELD ACTIVITIES / Amber Energy announces 498% Increase in Reserves
CALGARY, Jan. 15 /CNW/ - Amber Energy Inc. (''Amber'') announces certain
of its operational results for the year ended November 30, 1997.
The volumes and present value of Amber's petroleum reserves were
evaluated as at November 30, 1997 by Outtrim Szabo Associates Ltd.,
independent petroleum engineers, in their report dated January 14, 1998 (the
''Outtrim Report'').
Reserves Volumes
As at November 30, 1997
Company's Share of Remaining Reserves
(Before Royalties)
Crude Oil
& NGLs Natural Gas MMboe
MMstb Bcf (@ 10:1)
---------------------------------------------
Proved Developed 18.4 198.7 38.3
Proved Undeveloped 41.0 19.8 43.0
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Total Proved 59.4 218.5 81.3
Probable Additional 162.1 79.1 170.0
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Total Proved Plus Probable 221.5 297.6 251.3
Proved Plus 50% Probable 140.5 258.1 166.3
---------------------------------------------
1997 Reserves Reconciliation
Crude Oil
(Before & NGLs Natural Gas
Royalties) (MMstb) (Bcf)
-----------------------------------------------------
Proved Probable Total Proved Probable Total
-----------------------------------------------------
At Nov. 30, 1996 9.9 12.2 22.1 178.2 21.4 199.6
Discoveries 48.2 154.2 202.4 31.9 44.6 76.5
Acquisitions 0.0 0.0 0.0 42.0 0.0 42.0
Production (2.9) - (2.9) (33.9) - (33.9)
Dispositions 0.0 0.0 0.0 0.0 0.0 0.0
Revisions
/Reclassifications 4.3 (4.3) 0.0 0.3 13.1 13.4
-----------------------------------------------------
At Nov. 30, 1997 59.5 162.1 221.6 218.5 79.1 297.6
-----------------------------------------------------
MMboe (@ 10:1)
Proved Probable Total
-------------------------
At Nov. 30, 1996 27.7 14.4 42.1
Discoveries 51.4 158.6 210.0
Acquisitions 4.2 0.0 4.2
Production (6.3) - (6.3)
Dispositions 0.0 0.0 0.0
Revisions
/Reclassifications 4.3 (3.0) 1.3
-------------------------
At Nov. 30, 1997 81.3 170.0 251.3
-------------------------
Present Value of Estimated Future Net Revenue Before Tax ($ Millions)
Discounted at
------------------------------
Undiscounted 10% 12% 15%
------------------------------------------------
Proved Developed 486.9 308.1 288.6 264.2
Proved Undeveloped 375.8 184.0 161.6 133.7
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Total Proved 862.7 492.1 450.2 397.9
Probable Additional 2,285.5 989.1 868.3 725.0
------------------------------------------------
Total Proved Plus
Probable 3,148.2 1,481.2 1,318.5 1,122.9
Proved Plus 50% Probable 2,005.5 986.7 884.4 760.4
------------------------------------------------
The Outtrim Report includes estimated future capital costs of $432.0
million to move the Company's proved undeveloped and probable reserves into
the proved developed category. Estimated long-term debt as at November 30,
1997 was $197 million and Amber's net undeveloped land position was 643,000
acres. Amber estimates that the market value of this undeveloped acreage
position is approximately $110 million. Amber currently has 52.7 million
(58.3 million fully diluted) shares outstanding.
Drilling Results (93% Success Rate)
During its 1997 fiscal year, Amber drilled 185 (125.8 net) wells
resulting in 121 (95.2 net) oil wells, 53 (22.1 net) natural gas wells and 11
(8.5 net) dry holes and achieved a drilling success rate of 93%. In addition,
Amber drilled 27 (26.0 net) stratigraphic test oil wells during 1997, 22 of
which were in the Pelican Lake area. Amber's 1997 average production volumes
were 7,940 barrels of oil per day and 93 million cubic feet of natural gas per
day. Amber's current production volumes are approximately 20,000 barrels of
oil per day and 102 million cubic feet of natural gas per day.
Finding and Development Costs ($2.00/Boe proved plus 50% probable)
Based upon estimated 1997 capital expenditures, finding and development
costs were as follows:
1997E 1996 Cumulative
1993 - 1997
--------------------------------------
Total Capital Expenditures
($ Millions) $275.0 $77.8 $477.0
Finding and Development Costs
($/Boe)
Proved $4.59 $6.29 $5.02
Proved Plus 50% Probable $2.00 $5.53 $2.65
Proved Plus Probable $1.28 $4.94 $1.80
Pelican Lake Project Update
As at November 30, 1997, Amber's acreage position at Pelican Lake was
211.5 sections (203.7 net) and the Outtrim Report assigned 52.5 million proved
barrels and 106 million probable additional barrels of oil reserves under
primary recovery. An additional 51.3 million barrels of probable reserves
were assigned as secondary waterflood recoverable reserves. On primary
recovery alone, the Outtrim Report estimates that the total incremental
capital expenditures required to fully develop these Pelican Lake reserves
will be $393.4 million. To November 30, 1997, Amber had spent $160.0 million
in capital costs on the Pelican Lake project and the property had produced
1.27 million barrels of oil. Based on the current reserves assigned and
capital expenditure forecasts, total finding and development costs for the
Pelican Lake Project under primary recovery are expected to be $3.46 per
barrel.
At the December 10, 1997 Alberta Crown Land Sale Amber purchased, at 100%
working interest, an additional 102 sections of land in the Pelican Lake area
for $16.9 million. Reserves on these lands as well as 33 sections of
additional land within the pool boundaries have not yet been assigned any
proven or probable reserves in the Outtrim Report. Amber expects initial
reserves to be assigned to these lands as a result of the Company's current
drilling program.
Due to successful operations and favourable weather conditions, Amber is
confident that the sales pipeline currently being constructed will be
operational by June 1, 1998 as anticipated. At that time, if oil prices are
US $18.00 WTI per barrel and differentials are US $7.00 per barrel (LLK at
Kerrobert), Amber expects its field netbacks to be approximately $10.00 per
barrel, after royalties of one percent and operating expenses of $2.25 per
barrel. This results in a recycle ratio of 289% for the Pelican Lake Project
during a low oil pricing environment.
Amber's current production at Pelican Lake is 14,500 barrels of oil per
day from 79 wells. The Company has already drilled 53 wells (of which 43
wells are on production) in its current 100-well drilling program which is
expected to be completed in March 1998. Based on its current acreage position
of 305.7 net sections in the Pelican Lake area, Amber expects to drill an
additional 500 horizontal oil wells over the next five years on its acreage.
Amber is an independent Canadian oil and gas exploration, development and
production company with common shares trading on The Toronto Stock Exchange
and The Alberta Stock Exchange under the symbol AMB. |
