Stream Oil & Gas announces 2012 Oil Reserve Report

Stream Oil & Gas announced on 01 April the results of its November 30, 2012, independent reserves evaluation. Evaluations were conducted by Stream’s independent reserve evaluators Deloitte LLP (“Deloitte”), who previously operated as AJM Petroleum Consultants, in accordance with the provisions of National Instrument 51-101 (‘NI51-101’) and the Canadian Oil and Gas Evaluation Handbook (“COGEH”). Stream increased its proved plus probable reserves value, offsetting lower price forecast based on future sales and overcoming funding constraints. Stream focused its 2012 activities on advancing oil well workovers with new artificial lift systems, debottlenecking surface production facilities, and preparing to drill the horizontal well in the Delvina gas/condensate field.
2012 Total Reserves Summary (Net Share to Stream)
• Reserves remained consistent with the 2012 interim reserve report amounts (effective March 31, 2012):
o Total proved reserves marginally decreased to 16.8 MMboe as a result of rescheduling field programs
o Proved plus probable reserves increased to 25.6 MMboe as result of better performance
o Proved plus probable plus possible reserves increased to 38.6 MMboe
• Proved reserves comprise 66% of total proved plus probable reserves
• Proved reserve life index (“RLI”) is approximately 18+ years and proved plus probable RLI is 28+years, based on gross average production of approximately 2,500 boed
• Proved plus probable reserve value increased 5%, discounted at 10% after tax
All of Stream’s 2012 reserves estimates are based on conventional primary recovery methods only and do not include upside potential for the following:
• Petroleum Agreements’ provisions for neutralizing the 10% mineral tax of nearly US$20 million (before tax);
• Gorisht-Kocul oilfield waterflood program or future enhanced oil recovery (“EOR”) potential;
• Ballsh-Hekal and Cakran-Mollaj oilfield infill and directional drilling or EOR potential;
• Delvina gas field full horizontal well development potential, nor value of step-out exploration at Delvina
• Contingent resource conversions.
“We’re pleased with the results of our reserves evaluation,” said Dr. Sotirios Kapotas, President and CEO. “The reserves evaluation demonstrates the value of our assets, which we are focused on production as we advance with our 2013 development plans. The development of the Delvina field and exploration activities in the step-out Delvina block acreage present significant potential growth for the Company, increasing production and capturing additional reserves. The recent agreement completed with a power generator enables Stream to progress with Delvina development.”
The total proved reserve base is comprised of 90% oil and 10% natural gas. Stream’s gross and net reserves for 2012 remained consistent with the 2012 interim reserve report amounts. Additions based on reservoir production performance factors replaced production on a proved and proved plus probable basis.
Net Present Value of Reserves
At November 30, 2012, future net revenue from Stream’s reserves decreased 1% from the March 31, 2012 interim report on a total proved basis but increased 5% on a total proved and probable basis, discounted at 10% after tax. While the decrease is attributed to the rescheduling of Delvina and oilfields activities, the increase in valuation is primarily due to additional economic recovery as result of improved production performance, which also offset the reduction in price deck.

energjia.al, 04.04.2013