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Pacific Rubiales Announces 34% Growth in 2P Net Reserves in 2009 and Filingof 2009 Year-End Reserve Reports
Feb 25, 2010
TORONTO, Feb. 25 /CNW/ - Pacific Rubiales Energy Corp. (TSX: PRE; BVC: PREC) announced today that it has received independent reserve evaluation reports for the year ended December 31, 2009 in respect of the Rubiales-Piriri, Quifa, La Creciente, Guaduas, Rio Ceibas, Abanico and Puli blocks in Colombia. The combined proved plus probable (2P) reserves for these blocks increased by 34.3% in 2009, amounting to a net after royalties total to the company of 280.6 million barrels of oil equivalent (MMboe) as at December 31, 2009, having a total net present value (NPV) (10% discount, before tax) of US$8.32 billion.
Jose Francisco Arata, President, commented: "The growth in our proven and probable reserves is a direct result of the continued success of our development, appraisal and exploration drilling campaigns in 2009, and demonstrates the company's ability to successfully grow its reserve base year over year. With the additional drilling success we have experienced in the first quarter of this year, in the Quifa block in particular, we look forward to making 2010 another banner year in the growth of the company."
The following table summarizes year-over-year proved plus probable (2P) reserve growth for the Rubiales-Piriri, Quifa, La Creciente, Guaduas, Rio Ceibas, Abanico and Puli blocks:
------------------------------------------------------
2P Reserves 2008 Vs 2009
------------------------------------------------------
Condensate, Light Heavy Oil
& Medium Oil
------------------------------------------------------
100% Gross Net 100% Gross Net
------------------------------------------------------
(MMbbl) (MMbbl) (MMbbl) (MMbbl) (MMbbl) (MMbbl)
-------------------------------------------------------------------------
2008 15.00 8.78 7.48 366.55 158.89 127.52
-------------------------------------------------------------------------
2009 13.66 7.59 6.47 545.92 247.23 204.40
-------------------------------------------------------------------------
Net Reserve
Additions -1.34 -1.18 -1.01 179.37 88.35 76.88
-------------------------------------------------------------------------
Production 2.04 0.74 0.62 25.23 11.32 9.07
-------------------------------------------------------------------------
Total Reserve
Additions 0.70 -0.44 -0.39 204.60 99.67 85.95
-------------------------------------------------------------------------
----------------------------- -----------------------
2P Reserves 2008 Vs 2009
-----------------------------
Associated & Non- Oil Equivalent
Associated Gas
----------------------------- -----------------------
100% Gross Net 100% Gross Net
----------------------------- -----------------------
(Bcf) (Bcf) (Bcf) (MMboe) (MMboe) (MMboe)
------------------------------------------------ -----------------------
2008 485.19 480.63 443.84 462.41 247.77 208.98
------------------------------------------------ -----------------------
2009 472.22 449.76 418.22 638.28 329.78 280.58
------------------------------------------------ -----------------------
Net Reserve
Additions -12.98 -30.87 -25.62 175.87 82.02 71.60
------------------------------------------------ -----------------------
Production 19.60 18.30 16.80 29.87 14.50 11.96
------------------------------------------------ -----------------------
Total Reserve
Additions 6.62 -12.57 -8.82 205.74 96.51 83.56
------------------------------------------------ -----------------------
Notes:
(1) 100% reserves are all reserves attributable to the field. The company
does not hold an entire interest in 100% reserves. See table and
notes (2) and (3) below.
(2) Gross reserves are the company's share of the reserve before
deduction of royalty payments.
(3) Net reserves are the company's share of the reserve after deduction
of royalty payments.
(4) MMbbl means million barrels.
(5) Bcf means billion cubic feet.
(6) MMboe means million barrels of oil equivalent. Barrels of oil
equivalent (Boes) may be misleading, particularly if used in
isolation. A Boe conversion ratio of 6 thousand cubic feet: 1 barrel
is based on an energy equivalency conversion method primarily
applicable at the burner tip and does not represent a value
equivalency at the wellhead.
The report for the Rubiales-Piriri blocks dated February, 2010, effective December 31, 2009, and entitled "Reserves Certification Report for the Rubiales Field, Colombia" was prepared by RPS Energy Canada Ltd (RPS) in accordance with National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities (NI 51-101). The report in respect of the La Creciente, Guaduas, Rio Ceibas, Abanico, Quifa and Puli blocks dated February, 2010, effective December 31, 2009, and entitled "Evaluation of the Proved & Probable Reserves of Pacific Rubiales Energy Corp. in La Creciente, Guaduas, Rio Ceibas, Abanico, Quifa and Puli Blocks in Colombia" was prepared by Petrotech Engineering Ltd. (Petrotech) in accordance with NI 51-101. Both reports have been filed, and are available for viewing, on www.sedar.com. A brief summary of each report and certain operational information is provided below.
Rubiales-Piriri Block
---------------------
In the Rubiales-Piriri blocks, RPS evaluated the company's gross total proved reserves to be 178.6 MMbbl of heavy oil as at December 31, 2009. This represents a 44% increase compared to proved certified reserves of 124.1 MMbbl of heavy oil as at December 31, 2008. The gross proved reserves as at December 31, 2009 are based on a production level of 170,000 barrels of heavy oil per day in the Rubiales Field that is anticipated to be reached by the end of 2010. Gross reserves are the company's share of the reserve before deduction of royalty payments. The company's working interest is 40% in the Rubiales Block and 50% in the Piriri Block. In 2009, the Rubiales Field produced 25,122,033 barrels of heavy oil before fuel consumption. The Company's gross share of production in 2009 was 11,255,241 barrels before royalties and 9,004,193 barrels after royalties.
In the same reserve report, RPS evaluated the 100% field reserves (3P) for the Rubiales-Piriri blocks to be 501.2 MMbbl, of which 463.2 MMbbl are proved plus probable (2P) reserves and 417.2 MMbbl are proved (1P) reserves. The table below summarizes the reserves and net present value (NPV) discounted at 10% for the Rubiales-Piriri blocks for the year ended December 31, 2009 based on forecast prices and costs:
---------------- --------------------------------------------------------
Reserves Field Gross Meta Working NPV @ 10%
Category Reserves(1) Interest Reserves ------------
---------
---------------- --------------------------------------------------------
($MM US) ($MM US)
(MMbbl) (MMbbl) (MMbbl) (Before (After
100% (Gross)(2) (Net)(3) Tax) Tax)
---------------- --------------------------------------------------------
Proved
Developed
Producing 94.1 41.6 33.3 1,420.2 980.3
---------------- --------------------------------------------------------
Developed
Non-Producing 27.1 11.4 9.1 314.8 225.1
---------------- --------------------------------------------------------
Undeveloped 296.0 125.5 100.4 3,546.5 2,555.1
---------------- --------------------------------------------------------
Total Proved 417.2 178.6 142.9 5,281.5 3,760.5
---------------- --------------------------------------------------------
Probable 46.0 19.0 15.2 508.5 368.7
---------------- --------------------------------------------------------
Total Proved +
Probable 463.2 197.6 158.1 5,790.0 4,129.2
---------------- --------------------------------------------------------
Possible(4) 38.0 16.1 12.9 415.5 288.3
---------------- --------------------------------------------------------
Total Proved +
Probable +
Possible(4) 501.2 213.7 171.0 6,205.5 4,417.5
---------------- --------------------------------------------------------
Notes:
(1) Field Gross Reserves are all reserves attributable to the field. The
company does not hold an entire interest in field gross reserves. See
notes (2) and (3) below.
(2) Gross reserves are the company's share of the reserve before
deduction of royalty payments.
(3) Net reserves are the company's share of the reserve after deduction
of royalty payments.
(4) Possible reserves are those additional reserves that are less certain
to be recovered than probable reserves. There is a 10% probability
that the quantities actually recovered will equal or exceed the sum
of proved plus probable plus possible reserves.
The Quifa, La Creciente, Guaduas, Rio Ceibas, Abanico and Puli blocks
---------------------------------------------------------------------
With the successful drilling of 12 wells during 2009 for these blocks, Petrotech evaluated the company's gross total proved (1P) reserves as at December 31, 2009 for the Quifa, La Creciente, Guaduas, Rio Ceibas, Abanico and Puli blocks to be 92.5 MMboe and probable reserve to be 39.7 MMboe. Additional exploration and appraisal wells are scheduled for the company's 2010 exploration and drilling program.
Total gross proved plus probable (2P) reserves for the Quifa block in particular were evaluated to be 49.6 MMbbl of oil as at December 31, 2009; of which 36.7 MMbbl were probable reserves and 12.9 MMbbl were proved (1P) reserves. The company has a 60% working interest in the block.
A summary of the company's net share of proved developed producing, non-producing, undeveloped and probable reserves and future net revenue discounted at 0%, 5%, 10%, 15%, and 20% before income tax, is as follows:
-------------------- ----------------------------------------------------
Light & Med. Oil Heavy Oil Condensate
---------------------------------------------------
Reserve Category Gross Net Gross Net Gross Net
---------------------------------------------------
(MMbbl) (MMbbl) (MMbbl) (MMbbl) (MMbbl) (MMbbl)
-------------------- ----------------------------------------------------
Proved Producing 2.86 2.46 0.75 0.70 0.20 0.18
Proved Non-Producing 0.12 0.11 0.33 0.31 0.00 0.00
Proved Undeveloped 2.04 1.70 11.83 11.09 0.00 0.00
Total Proved 5.02 4.26 12.91 12.10 0.20 0.18
-------------------- ----------------------------------------------------
Probable Producing 0.37 0.35 36.72 34.20 0.00 0.00
Probable Undeveloped 2.01 1.68 0.00 0.00 0.00 0.00
Total Probable 2.38 2.03 36.72 34.20 0.00 0.00
Proved + Probable 7.40 6.29 49.63 46.30 0.20 0.18
-------------------- ----------------------------------------------------
-------------------- ------------------------------------
Non-Associated Gas Associated Gas
-----------------------------------
Reserve Category Gross Net Gross Net
-----------------------------------
(Bcf) (Bcf) (Bcf) (Bcf)
-------------------- ------------------------------------
Proved Producing 432.8 403.7 12.9 10.8
Proved Non-Producing 0.2 0.2
Proved Undeveloped 0.5 0.5
Total Proved 432.8 403.7 13.6 11.4
-------------------- ------------------------------------
Probable Producing 2.0 1.9
Probable Undeveloped 1.3 1.2
Total Probable 3.4 3.1
Proved + Probable 432.8 403.7 17.0 14.5
-------------------- ------------------------------------
-------------------- ----------------------------------------------------
Before Tax NPV discounted @
---------------------------------------------------
Reserve Category 0% 5% 10% 15% 20%
---------------------------------------------------
($MM) ($MM) ($MM) ($MM) ($MM)
-------------------- ----------------------------------------------------
Proved Producing 2,892.9 1,882.0 1,348.4 1,039.2 844.9
Proved Non-Prod. 9.8 8.3 7.3 6.5 5.9
Proved Undeveloped 412.4 362.5 323.5 292.4 267.2
Total Proved 3,315.1 2,252.8 1,679.2 1,338.1 1,118.0
-------------------- ----------------------------------------------------
Probable Producing 23.2 18.6 15.4 13.1 11.4
Probable Undev. 1,323.7 1,039.6 840.2 696.4 590.0
Total Probable 1,346.9 1,058.2 855.6 709.5 601.4
-------------------- ----------------------------------------------------
Proved + Probable 4,662.0 3,311.0 2,534.8 2,047.7 1,719.3
-------------------- ----------------------------------------------------
Notes:
(1) Gross reserves are the company's share of the reserve before
deduction of royalty payments.
(2) Net reserves are the company's share of the reserve after deduction
of royalty payments.
A summary of reserves information for each property evaluated in the Petrotech report is set out below:
---------- ----------------------------------------------------
Light & Medium Oil Heavy Oil
----------------------------------------------------
100% Gross Net 100% Gross Net
Reserve ---------- ----------------------------------------------------
Category Field (MMbbl) (MMbbl) (MMbbl) (MMbbl) (MMbbl) (MMbbl)
-------------------- ----------------------------------------------------
La
Creciente - - - - -
Guaduas 1.55 1.41 1.12 - - -
Rio Ceibas 1.10 0.30 0.24 - - -
Abanico
Main 2.94 0.73 0.69 - - -
Abanico
Norte 0.64 0.40 0.38 - - -
Quifa - - - 1.25 0.75 0.70
Puli 0.05 0.03 0.02 - - -
Proved developed
producing 6.28 2.86 2.46 1.25 0.75 0.70
-------------------- ----------------------------------------------------
Guaduas 0.03 0.03 0.03 - - -
Abanico
Main 0.35 0.09 0.08 - - -
Quifa - - - 0.56 0.33 0.31
Proved developed
non-producing 0.38 0.12 0.11 0.56 0.33 0.31
-------------------- ----------------------------------------------------
Guaduas 1.75 1.58 1.27 - - -
Abanico
Main 0.70 0.18 0.17 - - -
Abanico
Norte 0.40 0.28 0.27 - - -
Quifa - - 19.71 11.83 11.09
Proved undeveloped 2.85 2.04 1.70 19.71 11.83 11.09
-------------------- ----------------------------------------------------
Total Proved 9.51 5.02 4.27 21.52 12.91 12.10
-------------------- ----------------------------------------------------
Abanico
Main 0.42 0.11 0.10 - - -
Abanico
Norte 0.42 0.26 0.25 - - -
Probable developed
producing 0.84 0.37 0.35
-------------------- ----------------------------------------------------
Guaduas 1.71 1.55 1.24 - - -
Abanico
Main 1.14 0.28 0.27 - - -
Abanico
Norte 0.26 0.18 0.17
Quifa - - - 61.20 36.72 34.20
Probable undeveloped 3.11 2.01 1.68 61.20 36.72 34.20
-------------------- ----------------------------------------------------
Total Probable 3.95 2.38 2.03 61.20 36.72 34.20
-------------------- ----------------------------------------------------
Total Proved +
Probable 13.46 7.40 6.29 82.72 49.63 46.30
-------------------- ----------------------------------------------------
---------- ----------------------------------------------------
Condensate Non-Associated Gas
----------------------------------------------------
100% Gross Net 100% Gross Net
Reserve ---------- ----------------------------------------------------
Category Field (MMbbl) (MMbbl) (MMbbl) (Bcf) (Bcf) (Bcf)
-------------------- ----------------------------------------------------
La
Creciente 0.20 0.20 0.18 432.8 432.8 403.7
Guaduas - - - - - -
Rio Ceibas - - - - - -
Abanico
Main - - - - - -
Abanico
Norte - - - - - -
Quifa - - - - - -
Puli - - - - - -
Proved developed
producing 0.20 0.20 0.18 432.8 432.8 403.7
-------------------- ----------------------------------------------------
Guaduas - - - - - -
Abanico
Main - - - - - -
Quifa - - - - - -
Proved developed
non-producing - - - - - -
-------------------- ----------------------------------------------------
Guaduas - - - - - -
Abanico
Main - - - - - -
Abanico
Norte - - - - - -
Quifa - - - - - -
Proved undeveloped - - - - - -
-------------------- ----------------------------------------------------
Total Proved 0.2 0.2 0.2 432.8 432.8 403.7
-------------------- ----------------------------------------------------
Abanico
Main - - - - - -
Abanico
Norte - - - - - -
Probable developed
producing - -
-------------------- ----------------------------------------------------
Guaduas - - - - - -
Abanico
Main - - - - - -
Abanico
Norte
Quifa - - - - - -
Probable undeveloped - - - - - -
-------------------- ----------------------------------------------------
Total Probable - - -
-------------------- ----------------------------------------------------
Total Proved +
Probable 0.20 0.20 0.18 432.8 432.8 403.7
-------------------- ----------------------------------------------------
---------- -------------------------
Associated Gas
-------------------------
100% Gross Net
Reserve ---------- -------------------------
Category Field (Bcf) (Bcf) (Bcf)
-------------------- -------------------------
La
Creciente - - -
Guaduas 10.0 9.1 7.3
Rio Ceibas 0.9 0.3 0.2
Abanico
Main 13.1 3.3 3.0
Abanico
Norte 0.5 0.3 0.3
Quifa - - -
Puli - - -
Proved developed
producing 24.6 12.9 10.8
-------------------- -------------------------
Guaduas - - -
Abanico
Main 0.9 0.2 0.2
Quifa - - -
Proved developed
non-producing 0.9 0.2 0.2
-------------------- -------------------------
Guaduas - - -
Abanico
Main 1.10 0.27 0.25
Abanico
Norte 0.32 0.22 0.20
Quifa - - -
Proved undeveloped 1.42 0.49 0.45
-------------------- -------------------------
Total Proved 26.9 13.6 11.4
-------------------- -------------------------
Abanico
Main 7.3 1.8 1.7
Abanico
Norte 0.3 0.2 0.2
Probable developed
producing 7.6 2.0 1.9
-------------------- -------------------------
Guaduas - - -
Abanico
Main 4.8 1.2 1.1
Abanico
Norte 0.2 0.1 0.1
Quifa - - -
Probable undeveloped 5.0 1.3 1.2
-------------------- -------------------------
Total Probable 12.6 3.4 3.1
-------------------- -------------------------
Total Proved +
Probable 39.4 17.0 14.5
-------------------- -------------------------
Notes:
(1) 100% reserves are all reserves attributable to the field. The company
does not hold an entire interest in 100% reserves. See table and
notes (2) and (3) below.
(2) Gross reserves are the company's share of the reserve before
deduction of royalty payments.
(3) Net reserves are the company's share of the reserve after deduction
of royalty payments.
As at December 2009, the Company had the following working interests in each of the blocks evaluated in the Petrotech report:
Block - Field Name Working Interest Royalty Rate
------------------ ---------------- ------------
La Creciente - La Creciente 100% ANH sliding scale for
gas
Dindal & Rio Seco - Guaduas 90.6% 20%
Rio Ceibas - Rio Ceibas 27.27% 20%
Abanico - Abanico and Abanico 24.25 - 70% 5% for oil and 8% for
Norte gas
Puli - Puli-7 well 50.0% 20%
The estimates of reserves and future net revenues in this release are based on forecast prices and costs (as set forth in each report noted above) and are estimates only.
Reserves are classified according to the degree of certainty associated with the estimates. Proved reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves. 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. Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. It is unlikely that the actual remaining quantities recovered will exceed the sum of the estimated proved plus probable plus possible reserves.
Pacific Rubiales, a Canadian-based company and producer of natural gas and heavy crude oil, owns 100 percent of Meta Petroleum Corp., a Colombian oil operator which operates the Rubiales and Quifa Blocks in the Llanos Basin in association with Ecopetrol S.A., the Colombian national oil company. Pacific Rubiales also owns 100% of Pacific Stratus Energy which operates the rest of the production fields in Colombia. The company is focused on identifying opportunities primarily within the eastern Llanos Basin of Colombia as well as in other areas in Colombia and northern Peru. Pacific Rubiales has a current net production of over 55,000 barrels of oil equivalent per day (after royalties), with working interests in 32 blocks in Colombia and Peru.
Information in this press release expressed in barrels of oil equivalent (boe) is derived by converting natural gas to oil in the ratio of six thousand cubic feet (Mcf) of natural gas to one barrel (bbl) of oil. Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
Cautionary Note Concerning Forward-Looking Statements
This press release contains forward-looking statements including with respect to estimates of reserves and future net revenues and additional exploration and appraisal wells. All statements, other than statements of historical fact, that address activities, events or developments that the company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding estimates and/or assumptions in respect of production, revenue, cash flow and costs, reserve and resource estimates, potential resources and reserves and the company's exploration and development plans and objectives) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the company based on information currently available to the company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the company. Factors that could cause actual results or events to differ materially from current expectations include, among other things: uncertainty of estimates of capital and operating costs, production estimates and estimated economic return; the possibility that actual circumstances will differ from the estimates and assumptions; failure to establish estimated resources or reserves; fluctuations in petroleum prices and currency exchange rates; inflation; changes in equity markets; political developments in Colombia or Peru; changes to regulations affecting the company's activities; uncertainties relating to the availability and costs of financing needed in the future; the uncertainties involved in interpreting drilling results and other geological data; and the other risks disclosed under the heading "Risk Factors" and elsewhere in the company's annual information form dated April 1, 2009 filed on SEDAR at www.sedar.com. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
For further information: Mr. Ronald Pantin, Chief Executive Officer and Director, Mr. Jose Francisco Arata, President and Director, (416) 362-7735; Ms. Belinda Labatte, (647) 428-7035