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Gold/Mining/Energy : Canadian Oil & Gas Companies -- Ignore unavailable to you. Want to Upgrade?

To: Cal Gary who wrote (8707)	3/6/2002 9:59:14 AM
From: Cal Gary	Respond to of 24927

Gauntlet more than doubles value of reserves Gauntlet Energy Corp GAU Shares issued 14,587,718 Mar 5 close $6.53 Tue 5 Mar 2002 News Release Mr. Laurie Sibbald reports GAUNTLET MORE THAN DOUBLES VALUE WITH WINTER PROGRAM Gauntlet Energy's winter 2001/2002 drilling program has more than doubled the value of the company. Four new northern wells were drilled this winter, two each in the Hamburg and Snowfall areas. One well from each area is currently being tied in. The total new initial production capability from these two fully tested wells, all net to Gauntlet, is greater than 20 million cubic feet of gas and 500 barrels of condensate per day. An additional Snowfall location was abandoned and the other Hamburg location is standing with intermediate casing. The exact timing and magnitude of the additions to the company's production are dependent on the finalization of transportation and facility arrangements. All new production is expected to be on stream by the end of the second quarter. This will more than double Gauntlet's existing production base which averaged 20.3 million cubic feet per day of gas and 200 barrels per day of liquids in fourth quarter 2001. A new Gauntlet operated facility at Hamburg (10-02-99-10W6M) has been completed and will provide compression and dehydration facilities for both increased production from the current Gauntlet 50-per-cent working interest well (16-34-98-11W6M) and the new 04-08-99-10W6M well (100-per-cent Gauntlet until 400-per-cent payout of drilling and completion capital and 200 per cent of tie-in, at which point it reverts to 50-per-cent Gauntlet). The new Hamburg well is expected to be on production by the end of the first quarter. At Snowfall, a new Gauntlet facility at 07-05-99-08W6M is being built to provide gas/liquids separation, dehydration and compression for Gauntlet production from the area. New Gauntlet gas and condensate pipelines to the Chinchaga gas plant, 11 kilometres away, have already been constructed. The initial production date for the Snowfall well depends on additional work by the Chinchaga gas plant operator, which is expected to be completed during the second quarter. Year-end 2001 reserves have just been evaluated by independent engineers, incorporating the latest available data from the drilling program. Reserves highlights: Total proven reserves increased by 150 per cent year over year (6:1). New proven gas reserves replaced 2001 gas production eight times. Liquids production was replaced 37 times on proven reserves. Proven gas reserves have increased year over year from 38.3 billion cubic feet to 83.1 billion cubic feet and proven liquids reserves increased from 427 thousand barrels to 3,178 thousand barrels. Established reserves increased year over year from 44.9 billion cubic feet to 101.1 billion cubic feet and established liquids reserves increased from 538 thousand barrels to 3,422 thousand barrels. Corporate 2001 finding and development costs on proven reserves were $2.26 per barrel of oil equivalent (6:1) and $3.25 per boe (10:1). Year 2001 recycle ratio on proven reserves (6:1) is estimated to be 8.0 on a field netback basis and 6.5 on total cash flow from operations. Approximately 75 per cent of proven reserves will be in the producing category once new Northern production is brought on stream. The net present value of the company's reserves (PV10) is $168-million for proven and $192-million for established reserves. The company's net asset value (before tax, fully diluted, PV10) is estimated to be approximately $10 per share based on year-end 2001 established reserves and pricing. The company expects to report year-end 2001 operating and audited financial results on or about March 21. Gauntlet remains committed to its business plan. The company will continue to grow aggressively by using the drill bit and bringing new reserves on stream quickly and efficiently. The company continues to add to a growing list of prospects in existing core areas and in new areas in both central Alberta and the North. (c) Copyright 2002 Canjex Publishing Ltd. stockwatch.com