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CANADA ENERGY PARTNERS INTERIM RESERVE UPDATE REPORTS 142% INCREASE IN PROVED PLUS PROBABLE RESERVES

March 15, 2011

VANCOUVER, BRITISH COLUMBIA - Canada Energy Partners Inc. ("Canada Energy" or the "Company") (TSX VENTURE: CE) is pleased to report the results of an interim reserve study of the Company’s Montney lands, performed by GLJ Petroleum Consultants Ltd. (“GLJ”), effective December 31st, 2010. Recent successful drilling by the Company and its JV Partner at Peace River and by Shell adjacent to the Monias property has resulted in the attribution of significant reserves. The GLJ reserve update coupled with the coal bed methane reserve report by Netherland Sewell (April, 2010) show dramatic reserve growth over the previous year.

GLJ ascribed Company interest reserves of 7.65 billion cubic feet equivalent (“BCFe”) of proved reserves and proved plus probable reserves (“2P”) of 22.01 BCFe on its Montney lands. Company Interest reserves means the Company’s working interest share before deduction of royalties and including any royalty interest of the Company.  The undiscounted projected net cash flow is estimated to be $17.19 million from the proved reserves and $64.28 million from the 2P reserves.  The present value discounted at 10% (“PV10”) of the proved reserves is $4.91 million and $19.07 million for the 2P reserves.  77.5% of these 2P reserves were attributable to the Monias property and 22.5% to the Peace River property. The Company interest reserves as reported by Netherland Sewell at fiscal year-end April 30, 2010 were 0.27 BCF proved and 15.50 BCF 2P from the Peace River CBM Project.

The combined total of the Montney and CBM proved reserves is 7.9 BCF and 2P is 37.5 BCF representing a 142% increase in year-over-year 2P reserves. CIBC has reported that the average sales price for 2P gas reserves in Western Canada in 2010 was $1.95 per thousand cubic feet (“mcf”).

There have been three transactions in the Montney play in the last 90 days representing $7.5 billion of financial commitments from international energy companies. Most recently, on March 8th, Talisman and Sasol announced a second Joint Venture in the Montney on Talisman’s Cypress A Project.  Sasol will pay $1.05 billion for a 50% interest in the Cypress A Project.  CIBC estimates the transaction metrics at $0.19 per thousand cubic feet equivalent (“mcfe”) of contingent resource and $36,000 per acre.  Canada Energy Partners owns 27,239 net acres (42 net sections) of Montney rights.

Canada Energy is an active oil and gas exploration and development company. The Company possesses a large concentrated land position in a high-impact, multi-zone, natural gas-bearing area in northeast British Columbia.

BCFe may be misleading, particularly if used in isolation.  A BCFe conversion ratio of 1 bbl: 6 mcf 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 estimated values disclosed do not represent fair market value.

On behalf of the Board of Directors of
Canada Energy Partners Inc.

John Proust

John Proust

Chairman

 

For more information, please contact:

CANADA ENERGY PARTNERS INC.
1500 – 885 West Georgia St.
Vancouver, BC   V6C 3E8
Main Phone: (604) 909-1154 / Facsimile: (604) 488-0319

Attention: John Proust, Chairman
Email: info@canadaenergypartners.com
Direct Phone:  (604) 696-9020

Attention: Ben Jones, President and CEO
Email: info@canadaenergypartners.com
Direct Phone:  (225) 388-9900

www.canadaenergypartners.com

 

The TSX Venture Exchange has neither approved or disapproved of the contents of this press release.  Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

Forward Looking Statements: This news release contains forward looking statements relating to expected or anticipated flow rates,  timing for drilling and completion operations, future events and operations, number of wells to be drilled, timing of projects and anticipated results that are forward looking in nature and, as a result, are subject to certain risks and uncertainties, such as general economic, market and business conditions, the regulatory process and actions, technical issues, new legislation, competitive and general economic factors and conditions, the uncertainties resulting from potential delays or changes in plans, the occurrence of unexpected events, and the company’s capability to execute and implement future plans.  Actual results achieved may vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors.  There is no representation by the company that actual results achieved during the forecast period will be the same in whole or in part as that forecast. 

 


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