NEWSROOM

TORONTO, April 15, 2013 /CNW/ - Pacific Rubiales Energy Corp. (TSX: PRE; BVC: PREC; BOVESPA: PREB) announced today the results of an independent resource assessment for certain of the Company's exploration blocks in Colombia, Peru, Brazil, Guyana, Guatemala and Papua New Guinea ("PNG").  The 2012 resource assessment was prepared by Petrotech Engineering Ltd. ("Petrotech") with an effective date of September 30, 2012 (the "2012 Resource Report").

The 2012 Resource Report shows that the best case estimate of total gross Prospective Resources attributed to the Company has grown to 4.3 Bboe from 2.8 Bboe in 2011, and the best case estimate of total gross Contingent Resources has grown to 168 MMboe from just 4 MMboe booked in 2011.

Jose Francisco Arata, President of the Company, commented: "We look at the 2012 Resource Report as a clear demonstration of the Company's strategy to increase its resources using strategic acquisitions of exploration opportunities in selected countries where we see a balance of above- and below-ground risk.  Resources drive future reserves which in turn represent the future production of the Company."

Highlights on the best case estimates of total gross Prospective Resources and total best case Contingent Resources (see the heading below entitled "Resources" for further information) from the 2012 Resource Report include:

• 4,291 MMboe of total gross Prospective Resources (prospects plus leads), an increase of 55% from 2,774 MMboe in 2011.
• The total gross Prospective Resources are contained in 123 opportunities (74 prospects and 49 leads) on 40 assessed blocks in six countries.
• The total gross Prospective Resources are estimated to include 3,520 MMbbl of oil and natural gas liquids (82%), and 4.5 Tcf (772 MMboe) of natural gas (18%).
• 1,302 MMboe of the total gross Prospective Resources are in prospects (30%), an increase of 226% from 399 MMboe in 2011, largely reflecting new exploration blocks acquired in 2012 and successful exploration drilling.
• 2,989 MMboe of the total gross Prospective Resources are in leads (70%), a 26% increase from 2,375 MMboe in 2011, largely reflecting new exploration blocks acquired in 2012 and new leads defined on seismic surveys.
• 46% of the total gross Prospective Resources are in Colombia, 41% in Peru, 9% in Brazil, 3% in Guyana, and the remainder are in Guatemala and Papua New Guinea.
• 168 MMboe of total gross Contingent Resources, up substantially from 4 MMboe in 2011, mainly due to acquisitions and advancement from Prospective Resources through successful exploration drilling.

 

Contingent Resources

Petrotech's best case estimate of total gross Contingent Resources is 168 MMboe.  The bulk of these resources are in Block Z-1, which is estimated to contain 160 MMboe of natural gas (961 Bcf).  Additional Contingent Resources are in blocks CPO-17 and Topoyaco in Colombia, and are all oil.  The remaining Contingent Resources of are in Papua New Guinea PPL-237 containing 2.4 MMboe comprised of approximately 13 Bcf of natural gas and 0.3 MMbbl of natural gas liquids.  The Company's 2012 Contingent Resources are summarized in the table below:

 

TOTAL CONTINGENT  RESOURCES
COUNTRY	BLOCK	PROSPECT		100% RESOURCES			GROSS RESOURCES  (WI BEFORE ROYALTIES)
				LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)	LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)
COLOMBIA	CPO-17	MERLIN		1.2	7.5	25.3	0.3	1.9	6.3
	TOPOYACCO	PROSPECTO C		1.9	3.7	6.2	1.9	3.7	6.2
	TOTAL			3.1	11.2	31.5	2.2	5.6	12.5
PERU	Z1	PIEDRA REDONDA		14.0	327.0	601.3	6.9	160.2	294.7
PNG	PPL-237	TRICERATOPS		8.8	24.5	57.1	0.9	2.4	5.7
TOTAL				25.9	362.7	689.9	9.9	168.3	312.9

 

Prospective Resources

The bulk of the Company's resources are represented by Prospective Resources, contained in 120 opportunities in six countries.  The total best case estimate of total gross Prospective Resources is 4,291 MMboe, the low case estimate of total gross Prospective Resources is 1,179 MMboe, and the high case estimate of total gross Prospective Resources is 14,179 MMboe.  A summary of these estimates (segmented into prospects and leads categories) is provided in the tables below:

 

TOTAL PROSPECTIVES RESOURCES - PROSPECTS
COUNTRY	NUMBER OF BLOCKS	NUMBER OF OPPORT.	100% RESOURCES			GROSS RESOURCES  (WI BEFORE ROYALTIES)
			LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)	LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)
COLOMBIA	18	58	177.4	726.9	2,287.1	123.3	457.9	1,513.1
PERU	1	8	322.5	924.3	2,135.9	158.0	452.9	1,046.6
GUATEMALA	2	2	8.6	36.4	111.3	0.4	3.4	13.2
BRAZIL	5	3	479.0	1,085.8	1,835.0	167.6	380.0	642.3
PNG	1	3	31.0	80.9	206.0	3.1	8.1	20.6
Total	27	74	1,018.5	2,854.3	6,575.2	452.4	1,302.2	3,235.8

 

 

TOTAL PROSPECTIVE RESOURCES - LEADS
COUNTRY	NUMBER OF BLOCKS	NUMBER OF OPPORT.	100% RESOURCES			GROSS RESOURCES  (WI BEFORE ROYALTIES)
			LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)	LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)
COLOMBIA	12	37	515.3	2,298.4	7,275.7	379.1	1,500.7	4,671.4
PERU	4	9	336.8	1,304.3	4,578.0	328.4	1,283.7	4,537.8
GUATEMALA	2	1	6.4	27.0	83.8	3.5	14.9	46.1
PNG	1	1	77.8	477.6	1,561.8	7.8	47.8	156.2
GUYANA	3	1	29.7	515.7	5,577.1	8.1	141.6	1,531.2
Total	22	49	966.0	4,623.1	19,076.4	726.9	2,988.7	10,942.7

 

Colombia

In Colombia, the 2012 Resource Report covers the Company's working interest in 24 blocks (approximately 3.4 million net acres), containing 95 exploration opportunities (58 prospects and 37 leads) with a best case estimate of total gross Prospective Resources of 1,959 MMboe.  Of this estimate, approximately 63% corresponds to oil and natural gas liquids (1,243 MMbbl) and 37% to natural gas (4 Tcf), mainly from the blocks in the Lower Magdalena & Cesar Rancheria Basins. The Llanos and Putumayo Basins hold most of the total assessed Colombian Prospective Resourcess.  The Company's Prospective Resources in Colombia are summarized in the table below:

 

TOTAL PROSPECTIVE RESOURCES - COLOMBIA
COUNTRY	BASIN	NUMBER OF BLOCKS	NUMBER OF OPPORT.	100% RESOURCES			GROSS RESOURCES  (WI BEFORE ROYALTIES)
				LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)	LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)
COLOMBIA	LLANOS	10	47	122.8	1,039.6	3,141.2	64.1	521.7	1,485.8
	LMV & CR	5	28	255.3	819.6	2,783.1	236.9	745.8	2,549.7
	CATATUMBO	2	3	2.1	6.3	23.1	2.1	6.3	23.1
	UMV	2	2	11.1	35.9	90.9	3.2	9.5	23.3
	PUTUMAYO	5	15	301.4	1,124.0	3,524.4	196.0	675.3	2,102.6
	TOTAL	24	95	692.8	3,025.4	9,562.7	502.4	1,958.6	6,184.6

 

Peru

In Peru, the 2012 Resource Report covers the Company's working interest in four blocks (approximately 4.9 million net acres), containing 17 exploration opportunities (eight prospects and nine leads) with estimated best case total gross Prospective Resources of 1,737 MMbbl (all oil).  In Block 138 in the Ucayali basin, the Company has identified two large prospects, one of which will be evaluated with the drilling of the Yahuish-1x exploration well expected to commence during May 2013.  The Company's Prospective Resources in Peru are summarized in the table below:

 

TOTAL PROSPECTIVE RESOURCES - PERU
COUNTRY	BASIN	NUMBER OF BLOCKS	NUMBER OF OPPORT.	100% RESOURCES			GROSS RESOURCES  (WI BEFORE ROYALTIES)
				LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)	LOW (MMBoe)	BEST (MMBoe)	HIGH (MMBoe)
PERU	UCAYALI	1	6	263.0	774.8	2,068.5	263.0	774.8	2,068.5
	MARAÑON*	2	2	57.4	489.1	2,430.6	57.4	489.1	2,430.6
	TUMBES-TALARA	1	9	338.9	964.7	2,214.9	166.0	472.7	1,085.3
	TOTAL	4	17	659.2	2,228.6	6,714.0	486.4	1,736.6	5,584.4

 

* Includes Prospective Resources (lead) of 354.6 MMbbl of oil in Block 135 (re-activated exploration in 2013 upon resolution of environmental issues in effect since 2007) and Prospective Resources (lead) of 234.5 MMbbl of oil in Block 137 (in force majeure), both of which were last evaluated in a certified resource report undertaken by the Company in 2007 and do not form part of the current Petrotech Report).

 

Other Countries

In Brazil, the 2012 Resource Report covers the Company's working interest in five blocks (approximately 75 thousand net acres), containing three exploration opportunities (all prospects) with a best case estimate of total gross Prospective Resources of 380 MMbbl of oil.

In Guatemala, the 2012 Resource Report covers the Company's working interest in two blocks (approximately 73 thousand net acres), containing three exploration opportunities (two prospects and one lead) with a best case estimate of total gross Prospective Resources of 18 MMbbl of oil.

In Papua New Guinea, the 2012 Resource Report covers the Company's working interest on one block (72 thousand net acres), containing four exploration opportunities (three prospects and one lead) with a best case total gross Prospective Resources of 330 Bcf of natural gas (56 MMboe).

In Guyana, the 2012 Resource Report covers the Company's then 27% interest in three blocks (approximately 2 million net acres), held through its equity interest in CGX Energy Inc. ("CGX"). In the current resource report only one opportunity (lead) has been evaluated with a best case estimate of gross Prospective Resources of 142 MMbbl of oil. On the Corentyne Block (not included in this assessment), DeGolyer and MacNaughton in a resource report effective December 31, 2012, assessed for CGX mean Prospective Resources of 1,522 MMbbl of liquid hydrocarbons (779 MMbbl of oil and 743 MMbbl of condensate) and 7,889 Bcf of non-associated and associated gas, contained in six exploration opportunities, for a total of 2,837 MMboe for the CGX prospects in this basin.

Pacific Rubiales, a Canadian company and producer of natural gas and crude oil, owns 100% of Meta Petroleum Corp., which operates the Rubiales, Piriri and Quifa heavy oil fields in the Llanos Basin, and 100% of Pacific Stratus Energy Colombia Corp., which operates the La Creciente natural gas field in the northwestern area of Colombia.  Pacific Rubiales has also acquired 100% of PetroMagdalena Energy Corp., which owns light oil assets in Colombia, and 100% of C&C Energia Ltd., which owns light oil assets in the Llanos Basin.  In addition, the Company has a diversified portfolio of assets beyond Colombia, which includes producing and exploration assets in Peru, Guatemala, Brazil, Guyana and Papua New Guinea.

The Company's common shares trade on the Toronto Stock Exchange and La Bolsa de Valores de Colombia and as Brazilian Depositary Receipts on Brazil's Bolsa de Valores Mercadorias e Futuros under the ticker symbols PRE, PREC, and PREB, respectively.

Advisories

Cautionary Note Concerning Forward-Looking Statements

This press release contains forward-looking statements. 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, Peru, Guatemala, Brazil, Papua New Guinea or Guyana; 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 March 13, 2013 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.

Statements related to resources are deemed forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions, that the resources will be discovered (in the case of Prospective Resources) and can be profitably produced in the future. Specifically, forward-looking information contained herein regarding  "resources" may include: estimated volumes and value of the Company's oil and gas resources;  estimated volumes of Contingent and Prosepctive Resources and the ability to finance future development; and, the conversion of a portion of Contingent Resources into reserves and Prospective Resources into Contingent Resources.

Currency

All dollar amounts in this news release are expressed in U.S. dollars ($), unless otherwise stated.

Translation

This news release was prepared in the English language and subsequently translated into Spanish and Portuguese. In the case of any differences between the English version and its translated counterparts, the English document should be treated as the governing version.

Definitions 

Bcf	Billion cubic feet.
Bcfe	Billion cubic feet of natural gas equivalent.
bbl	Barrel of oil.
bbl/d	Barrel of oil per day.
boe	Barrel of oil equivalent. Boe's may be misleading, particularly if used in isolation. The Colombian standard is a boe conversion ratio of 5.7 Mcf:1 bbl and is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
boe/d	Barrel of oil equivalent per day.
Bboe	Billion barrel of oil equivalent
Mbbl	Thousand barrels.
Mboe	Thousand barrels of oil equivalent.
MMbbl	Million barrels.
MMboe	Million barrels of oil equivalent.
Mcf	Thousand cubic feet.
WTI	West Texas Intermediate Crude Oil.

 

Resources

Readers should give attention to the estimates of individual classes of resources and appreciate the differing probabilities of recovery associated with each class. Estimates of remaining recoverable resources (unrisked) include Prospective resources that have not been adjusted for risk based on the chance of discovery or the chance of development and Contingent resources that have not been adjusted for risk based on the chance of development. It is not an estimate of volumes that may be recovered. Actual recovery is likely to be less and may be substantially less or zero.

Prospective Resources are those quantities of oil and gas estimated to be potentially recoverable from undiscovered accumulations.  There is no certainty that the Prospective Resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the Prospective Resources. Application of any geological and economic chance factor does not equate Prospective resources to Contingent Resources or reserves. In addition, the following mutually exclusive Classification of Resources were used:

• Low Estimate - This is considered to be a conservative estimate of the quantity that will actually be recovered from the accumulation. This term reflects a P90 confidence level where there is a 90% chance that a successful discovery will be equal to more than this resources estimate.
• Best Estimate - This is considered to be the best estimate of the quantity that will actually be recovered from the accumulation. This term is a measure of central tendency of the uncertainty distribution and in this case reflects a 50% confidence level where there is a 50% chance that the successful discovery will be equal to or more than this resources estimate.
• High Estimate - This is considered to be an optimistic estimate of the quantity that will actually be recovered from the accumulation. This term reflects a P10 confidence level where there is a 10% chance that the successful discovery will be equal to or more than this resources estimate.

 

Contingent Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingent Resources have an associated chance of development (economic, regulatory, market and facility, corporate commitment or political risks). The estimates herein have not been risked for the chance of development. There is no certainty that the Contingent Resources will be developed and, if they are developed, there is no certainty as to the timing of such development or that it will be commercially viable to produce any portion of the Contingent Resources.

In this press release total volumes of resources have been expressed for high case estimates, low case estimates and best case estimates for both Contingent and Prospective Resources.  These total volumes are arithmetic sums of multiple estimates of Contingent and Prospective Resources, as the case may be, which statistical principles indicate may be misleading as to volumes that may actually be recovered. Readers should give attention to the estimates of individual classes of resources and appreciate the differing probabilities of recovery associated with each class as explained in this section.

 

SOURCE: Pacific Rubiales Energy Corp.