CALGARY, Alberta, June 07, 2018 (GLOBE NEWSWIRE) — Clearview Resources Ltd. (“Clearview” or the “Company”) is pleased to announce its crude oil and natural gas reserves information for the year ended March 31, 2018.
March 31, 2018 Highlights:
- Produced 2,101 barrels of oil equivalent per day (“boe/d”), a 215 percent increase from 665 boe/d for the year ended March 31, 2017.
- Increased total proved and total proved plus probable oil reserves by 19 percent and 20 percent, respectively, from a successful optimization and well workover program, the acquisition of a 50% working interest in the Windfall property and an improved future development program at the Company’s Wilson Creek property.
- Total proved and total proved plus probable reserve before tax value discounted at ten percent increased 13 percent and 19 percent, respectively.
- Total proved plus probable natural gas reserves increased by 4 percent. Total proved natural gas reserves were negatively impacted by 23 percent because of the current forecast natural gas prices resulting in the shifting of reserves at the Company’s Northville property from the proved undeveloped reserve category to the probable reserve category.
- Total proved producing reserves remained flat at approximately 5 million barrels of oil equivalent (“boe”) after having produced 766.8 thousand boe for the year ended March 31, 2018.
SUMMARY OF OIL AND NATURAL GAS RESERVES
AND NET PRESENT VALUES OF FUTURE NET REVENUE
AS OF MARCH 31, 2018
FORECAST PRICES AND COSTS
GLJ Petroleum Consultants Ltd. (“GLJ”), the Company’s independent petroleum engineering firm, has evaluated Clearview’s crude oil, natural gas and natural gas liquids reserves as at March 31, 2018 and prepared a reserves report (the “GLJ Report”) in accordance with National Instrument 51-101 “Standards of Disclosure for Oil and Gas Activities” and the “Canadian Oil and Gas Evaluation Handbook”. GLJ’s price forecast dated April 1, 2018 was used in the evaluation. Company gross reserves in the total proved and total proved plus probable categories decreased 14 percent and increased 6 percent, respectively, compared to March 31, 2017. The decrease in the total proved category was driven by the removal of gas weighted, proved undeveloped drilling locations at the Northville property. These reserves remain in the probable reserve category. This change in reserve booking category was driven primarily by the economics related to the current forecast natural gas prices. The increase in total proved plus probable reserve category was driven primarily by the Windfall property acquired January 4, 2018 (50% working interest).
The following is a summary of the Company’s gross reserves information detailed in the GLJ Report at March 31, 2018:
NATURAL GAS (1)
|TOTAL PROVED PLUS PROBABLE||4,060||4,040||51,225||50,807||2,996||2,980||15,594||15,488|
|(1)||Includes solution gas.|
|(2)||Oil equivalent amounts have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil (6:1).|
|(3)||Company Gross Reserves are the Company’s working interest share of the remaining reserves plus royalty interest reserves, before deduction of any royalties.|
|(4)||Company Net Reserves are the gross remaining reserves of the properties in which the Company has a working interest.|
|Tables may not add due to rounding.|
Net Present Value of Future Net Revenue
The estimated future net revenues associated with Clearview’s reserves at March 31, 2018, based on the GLJ April 1, 2018 price forecast, are summarized in the following table. The net present value of future net revenues, discounted at ten percent, from total proved and total proved plus probable reserves increased by 13 percent and 19 percent respectively, compared to March 31, 2017. The increase in net present value was driven mostly by the oil weighted Windfall property acquisition (50% working interest) and the Wilson Creek Cardium development program being modified to optimize the drilling of two-mile horizontal wells.
|NET PRESENT VALUES OF FUTURE NET REVENUE
BEFORE INCOME TAXES DISCOUNTED AT (%/year)
|TOTAL PROVED PLUS PROBABLE||221,033||158,919||120,125||94,624||76,978||7.76|
|(1)||Unit values are before income tax discounted at 10% and based on net reserve values.|
|(2)||Future net revenues are estimated using forecast prices, costs arising from the anticipated development and production of reserves, associated royalties, operating costs, development costs, and abandonment and reclamation costs. The estimated values disclosed do not necessarily represent fair market value.|
|TOTAL FUTURE NET REVENUE|
|AS OF MARCH 31, 2018|
|FORECAST PRICES AND COSTS|
|Total Proved plus Probable||632||69||241||93||16||563|
|(1)||Includes all product revenues and other revenues as forecast.|
|(2)||Royalties include Crown, freehold, overriding royalties, and freehold mineral taxes|
|SUMMARY OF PRICING AND INFLATION RATE ASSUMPTIONS|
|FORECAST PRICES AND COSTS (1)|
|(1)||GLJ escalated price forecast as at April 1, 2018|
|(2)||Inflation rate for costs.|
|(3)||Exchange rate used to generate the benchmark reference prices in this table.|
The following reconciliation of Clearview’s reserves compares changes in the Company’s gross reserves at March 31, 2017 to the reserves at March 31, 2018, each evaluated in accordance with National Instrument 51-101 definitions.
|Oil (Mbbls)||Proved Producing
||Total Proved + Probable|
|March 31, 2017||Opening Balance||1,269.8||2,247.8||3,360.8|
|March 31, 2018||Closing Balance||1,220.1||2,675.4||4,040.4|
|Gas (MMcf)||Proved Producing
||Total Proved + Probable|
|March 31, 2017||Opening Balance||16,661.3||30,010.7||48,628.9|
|March 31, 2018||Closing Balance||16,671.1||22,984.2||50,806.7|
|NGL’s (Mbbls)||Proved Producing
||Total Proved + Probable|
|March 31, 2017||Opening Balance||1,004.3||1,885.3||3,099.4|
|March 31, 2018||Closing Balance||1,017.6||1,324.7||2,979.6|
|BOE’s (Mbbls)||Proved Producing
||Total Proved + Probable|
|March 31, 2017||Opening Balance||5,050.9||9,134.9||14,565.0|
|March 31, 2018||Closing Balance||5,016.1||7,830.7||15,487.8|
Finding and Development Costs
For the year ended March 31, 2018, Clearview conducted various optimization and well workover projects on its properties. The Company also closed the purchase of a 50% working interest in the Windfall property. Finding and development costs for proved producing, total proved and proved plus probable reserves for 2018 are presented below.
|Capital ($ thousands)(2)||Proved Producing
||Total Proved plus
|Exploration and Development (“E&D”) costs||2,999||2,999||2,999|
|Change in FDC related to E&D||(17||)||(8,865||)||2,636|
|Total E&D Costs||2,982||(5,866||)||5,635|
|Acquisition and Disposition (“A&D”) costs||3,376||3,376||3,376|
|Change in FDC related to A&D||–||5,505||12,295|
|Total A&D Costs||3,376||8,881||15,671|
|Total Reserve Discoveries, Extensions & Revisions (3)||433.1||(1,472.5||)||(439.4||)|
|Total Acquisitions and Dispositions||298.5||935.1||2,128.9|
|Total Reserve Additions||731.6||(537.4||)||1,689.5|
|E&D, including change in FDC related to E&D (“F&D”)||$6.88/boe||$3.98/boe||($12.82)/boe|
|E&D and A&D, including change in FDC (“F,D&A”)||$8.69/boe||($5.61)/boe||$12.61/boe|
|(1)||Tables may not add due to rounding|
|(2)||All the production and capital values in this table are unaudited|
|(3)||Includes extensions and improved recovery, technical revisions, discoveries and economic factors|
|(4)||F&D and F,D&A are oil and gas metrics, please see the advisory section of this press release.|
The F,D&A for the total proved reserve category and the F&D for the total proved plus probable category is not meaningful as the reserve additions are negative. The total proved revision was driven primarily by the removal of gas weighted, proved undeveloped drilling locations at the Northville property. These reserves remain in the probable reserve category. This change in reserve booking is due to the economics related to the current forecast natural gas prices.
The Company’s proved producing reserve life index (“RLI”) is 7.1 years and the total proved RLI is 10.5 years. The total proved plus probable RLI is 18.3 years.
Information regarding Clearview is available on Sedar at www.sedar.com. For further information contact Tony Angelidis, President & CEO of Clearview at 587-393-8502 firstname.lastname@example.org or Brian Kohlhammer, Vice President Finance & CFO at 587-393-8504 email@example.com.