News

Oryx Petroleum Announces its Year End 2018 Reserves and Resources

13 February 2019

Calgary, Alberta, February 13, 2019

Proved Plus Probable Oil Reserves of 127 million barrels and US$ 814 million^([1]) in Related After-Tax Net Present Valueof Future Net Revenue as at December 31, 2018

Oryx Petroleum Corporation Limited (“Oryx Petroleum” or the “Corporation”) today announced its oil reserves and resources as at December 31, 2018 as evaluated by Netherland, Sewell & Associates, Inc. (“NSAI”), an independent oil and gas consulting firm, and as set forth in a report dated February 8, 2019 prepared in accordance with National Instrument 51-101 by NSAI (the “2018 NSAI Report”). The reserves and resources disclosure coincides with the filing on SEDAR at www.sedar.com of a material change report (the “Material Change Report”), which includes additional information derived from the 2018 NSAI Report.

Highlights of the report for Oryx Petroleum’s gross (working interest) oil reserves and resources volumes, and future net revenue related to oil reserves and contingent oil resources sub-classified as development pending in the Hawler license area as at December 31, 2018, as compared to the equivalent estimates prepared by NSAI as at December 31, 2017 (the “2017 NSAI Report”), include:

►     Proved plus probable oil reserves increase 4% to 127 million barrels (“MMbbl”) versus 122 MMbbl as at December 31, 2017:

• Increase of volumes due to successful drilling in the Banan Tertiary reservoir in 2018 leading to the reclassification of related volumes from contingent oil resources
• Decrease of volumes attributable to the Zey Gawra Cretaceous reservoir based on logging results from wells drilled at Zey Gawra in 2018 and well performance data
• Reclassification of volumes attributable to the Demir Dagh Jurassic reservoir as contingent resources due to absence of plans to appraise or develop the reservoir

►     After-tax net present value of future net revenue related to proved plus probable oil reserves increases 16% to US$ 814 million⁽¹⁾versus US$ 704 million^([2]) as at December 31, 2017:

• Increase is the result of higher forecast production volumes and significantly lower estimated per barrel development costs, partially offset by a more gradual increase in production and lower export oil prices

►     Best estimate (2C) unrisked contingent oil resources attributable to the Hawler license area of 168 MMbbl as at December 31, 2018 versus 148 MMbbl as at December 31, 2017:

• Reclassification of volumes attributable to the Demir Dagh Jurassic reservoir from reserves to contingent resources, partially offset by reclassification of volumes attributable to the Banan Tertiary reservoir from contingent resources to reserves

►     Best estimate unrisked prospective oil resources of 2,263 MMbbl as at December 31, 2018 versus 3,750 MMbbl as at December 31, 2017

• Refined estimates for the AGC Central license area based on further interpretation of seismic data and remapping of prospects completed in 2018

CEO’s Comment

Commenting today, Oryx Petroleum’s Chief Executive Officer, Vance Querio, stated:

“We are pleased to report our reserves and resources at year end 2018 as evaluated by NSAI. We are particularly pleased to report increases to both proved plus probable oil reserves and associated after-tax net present value of future net revenue. The 4% increase in proved plus probable reserves is primarily the result of successful appraisal activities in the Banan field in the Hawler license area which has resulted in the booking of reserves attributable to the Banan Tertiary reservoir. The after-tax net present value of future net revenue related to proved plus probable oil reserves increased by 16% due to the modest increase in proved plus probable reserves and, more importantly, substantially lower estimated capital expenditures. Based on our experience drilling horizontal wells in 2018, future wells are expected to cost significantly less than previously estimated. Also, the unit development cost of the new reserves attributable to the Banan Tertiary reservoir is much lower than the cost of the reserves lost to downward revisions and reclassification. The cost of facilities is also less than previously estimated.

The remapping of prospects based on interpretation of 3D seismic data completed in 2018 has resulted in a refinement and a downward revision to estimated prospective oil resources attributable to the AGC Central license area. The adjustment in no way diminishes our belief in the significant potential of the AGC Central license.

We are planning an active drilling program in 2019 in the Hawler license area that we expect will both increase production and allow us to better assess fields and reservoirs where we currently have contingent or prospective resources but no reserves. With prospects ranked and identified in the AGC Central exploration license area in West Africa, we plan to complete an environmental impact assessment and prepare for exploration drilling in 2020.”