LSE & TSX TRADING SYMBOL: AAK
ST. HELIER, Jersey, March 11 /CNW/ - Arawak Energy Limited ("Arawak" or
the "Company"), an oil and gas exploration and production company, announces
the results of its independent reserves evaluation as at 31 December 2008.
Evaluations were conducted by McDaniel & Associates Consultants Ltd for
Kazakhstan, and Ryder Scott Company, L.P. for Russia and Azerbaijan, and were
prepared in accordance with standards set out under the National Instrument
51-101 Standards of Disclosure for Oil and Gas Activities of the Canadian
Securities Administrators ("NI 51-101").
The Company's proved(5) reserves ("1P") totalled 36.99 million barrels of
oil equivalent ("boe") as at 31 December 2008, a decline of 7% from the 39.93
million boe recorded as at 31 December 2007(4). Arawak's probable(6) reserves
increased 6% to 24.86 million boe as at 31 December 2008 compared with 23.41
million boe a year ago. Overall, the Company's net proved plus probable
reserves ("2P") declined 2% to 61.85 million boe.
Arawak's total working interest production in 2008 was 4.17 million boe,
or 11,393 barrels of oil equivalent per day ("boepd"). At the beginning of
March 2009, Arawak was producing approximately 14,300 boepd.
The assets included in the latest evaluation are a 100% working interest
in the Akzhar, Besbolek, Alimbai and Karataikyz oil fields and a 40%
participation in the Saigak oil field, all in Kazakhstan, a 50% working
interest in the North Irael and Sotchemyu-Talyu oil fields in Russia, and a
29.7% holding in the South West Gobustan oil and gas blocks in Azerbaijan.
Under NI 51-101 reporting standards, the reserve auditors also provide
field-level net present value ("NPV") calculations of the reserve base at
standard discount rates. These NPV calculations do not take into account
general and administrative costs, corporate overheads, the indebtedness of the
group or the Company's actual cost of capital, and therefore may be materially
different from any market valuation of the business on normal commercial
terms. Using an assumed 10% discount rate, the NPV of the Company's 2008
year-end 2P reserves base was US$608.1 million. Further information regarding
NPVs and the associated price assumptions can be found in Appendix 1. Dollar
amounts referred to in Appendix 1 are expressed in United States dollars.Kazakhstan Reserves Summary
- 1P reserves increased 7% to 23.06 million barrels of oil from
21.49 million barrels as at 31 December 2007(4) after production of
2.50 million barrels of oil;
- 2P reserves rose 8% to 37.44 million barrels of oil from 34.76 million
barrels as at 31 December 2007(4);
- The reserves growth in Kazakhstan is primarily attributable to
exploration success at the Akzhar field, which was later confirmed by
delineation drilling;
- Arawak drilled ten successful development wells in the Akzhar field in
the fourth quarter of 2008 following regulatory approval in September
of the technical plan of development. However, perforation of five
wells was delayed until 2009 due to the temporary suspension of
production in December as a result of unfavourable commercial
conditions. Production at Akzhar recommenced in mid-January and is
currently at approximately 6,000 barrels of oil per day as new wells
continue to be brought on stream.
Russia Reserves Summary
- 1P reserves decreased 35% to 7.98 million barrels of oil from
12.29 million barrels as at 31 December 2007 after production of
1.63 million barrels of oil;
- 2P reserves declined 29% to 9.44 million barrels of oil from
13.31 million barrels as at 31 December 2007;
- Additional incremental volumes relating to recently interpreted 3D
seismic data for the North Irael field have been incorporated as
probable and possible(7) reserves;
- Reappraisal of some marginal well locations against revised economic
thresholds for taxation and increasing costs has resulted in a
downwards adjustment to the corresponding reserve estimates.
Azerbaijan Reserves Summary
- 1P reserves fell 3% to 5.95 million boe from 6.16 million boe as at
31 December 2007;
- 2P reserves slipped 2% to 14.97 million boe with oil accounting for
58% of the total, or 8.63 million barrels, and gas accounting for 42%
or 6.34 million boe;
- No drilling activity occurred in 2008 while seismic data was processed
and interpreted.
Reserves summary table:
(Reserves stated in thousand of barrels of oil equivalent ("Mboe"))
------------------------------------------------------------------------
Field Operator Arawak Arawak's Arawak's Arawak's
Interest share of share of share of
proved proved proved
reserves plus plus
Mboe(1) probable probable
reserves plus
Mboe(1) possible
reserves
Mboe(1)
------------------------------------------------------------------------
Kazakhstan
------------------------------------------------------------------------
Akzhar Arawak 100% 16,372 27,154 39,867
Besbolek Arawak 100% 4,530 6,898 11,806
Saigak Maersk Oil 40% 1,320 2,260 3,157
Karataikyz Arawak 100% 252 354 522
Alimbai Arawak 100% 587 770 953
East Arawak 100% - - -
Zharkamys III
Tamdykol Arawak 100% - - -
Total Kazakhstan 23,061 37,436 56,305
------------------------------------------------------------------------
Russia
------------------------------------------------------------------------
Sotchemyu-Talyu PNG(9) 50% 6,463 6,463 6,856
North Irael Recher(9) 50% 1,513 2,977 3,657
Kymbozhyuskaya Arawak 100% - - -
South Sotchemyu Arawak 100% - - -
Total Russia 7,977 9,440 10,513
------------------------------------------------------------------------
Azerbaijan
------------------------------------------------------------------------
South West CNPC 29.736% 2,311 8,627 12,909
Gobustan - oil
------------------------------------------------------------------------
South West CNPC 29.736% 3,639 6,342 9,341
Gobustan - gas
------------------------------------------------------------------------
Total Azerbaijan 5,950 14,970 22,249
------------------------------------------------------------------------
Total Reserves 36,987 61,846 89,068
------------------------------------------------------------------------
Notes:
(1) Columns and rows may not add up precisely due to rounding.
(2) Proved, probable and possible reserves are based on forecast prices
and costs evaluated as of 31 December 2008 by the independent
reserves evaluators.
(3) The reserves outlined are Arawak's working interest (operating or
non-operating) share before deduction of royalty obligations payable
to other parties and without including any royalty interests of
Arawak.
(4) Reserves as of 31 December 2007 were restated in June 2008 to include
reserves associated with the acquisition of a 40% working interest in
the Saigak field in Kazakhstan.
(5) "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.
(6) "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.
(7) "Possible" reserves are those additional reserves that are less
certain to be recovered than probable reserves. It is unlikely that
the actual quantities recovered will exceed or equal the sum of the
estimated proved plus probable plus possible reserves.
(8) For the purpose of this announcement a barrel of oil equivalent
("boe") is derived by converting gas to oil in the ratio of six
thousand cubic feet of natural gas to one barrel of crude oil. Boe
may be misleading, particularly if used in isolation. A boe
conversion is based on an energy equivalency conversion method
primarily applicable at the burner tip and does not represent a value
equivalency at the wellhead.
(9) Arawak's producing assets in Russia are held through ZAO
PechoraNefteGas ("PNG") and LLC NK Recher-Komi ("Recher"), in which
Arawak has a 50% interest.
For further information please contact:
Arawak Energy Limited Tel: +44 (0) 20 7973 4285
Tanya Pang, Head of Investor Relations Fax: +44 (0) 20 7824 8466
E-mail: info@arawakenergy.com Web: www.arawakenergy.com
Brunswick Group LLP Tel: +44 (0)20 7404 5959
Patrick Handley
JPMorgan Cazenove Limited Tel: +44 (0)20 7588 2828
Steve Baldwin
Neil Haycock
Oriel Securities Limited Tel: +44 (0)20 7710 7600
Richard Crawley
Natalie FortescueNotes to editors:
Arawak's Common Shares are listed for trading on both the Toronto Stock
Exchange ("TSX") and the London Stock Exchange ("LSE") under the symbol "AAK".
On 16 January 2008, Arawak together with Rosco S.A. ("Rosco"), announced that
the Boards of both companies had reached agreement on the terms of a
recommended and increased pre-conditional cash offer to be made by Rosco (or a
wholly owned subsidiary of Rosco) to acquire the entire issued and to be
issued share capital of Arawak (the "Increased Recommended Offer"). The
Increased Recommended Offer is being made at a price of CAD 1.00 for each
Arawak share. All documentation related to the Offer can be found on
www.arawakenergy.com or on www.sedar.com.
Arawak is engaged in the exploration, development and production of oil
and natural gas in Kazakhstan, Russia and Azerbaijan. In Kazakhstan, the
Company holds five producing fields and two exploration blocks. The Company
has a 40% participating interest in the Saigak producing block acquired in
June 2008. The remaining assets are held through its 100% wholly-owned
subsidiary Altius Energy Corporation ("Altius"). Altius' main producing field
is Akzhar with smaller fields at Besbolek, Karataikyz and Alimbai. The two
exploration blocks East Zharkamys III and Tamdykol are also situated in
western Kazakhstan. Arawak's producing assets in Russia are held through ZAO
PechoraNefteGas ("PNG") and LLC NK Recher-Komi ("Recher-Komi"), in which
Arawak has a 50% interest with the remaining interest being held by Lundin
Petroleum AB. Also in Russia, Arawak holds a 100% interest in the
Kymbozhyuskaya exploration block and in the South Sotchemyu appraisal block.
In Azerbaijan, the Company's asset is its interest in the Exploration
Development and Production Sharing Agreement ("EDPSA") for the South West
Gobustan oil and gas fields. CGL, a company registered in Anguilla, British
West Indies, in which the Company has a 37.17% interest, holds an 80% interest
in the EDPSA with the remaining 20% held by an affiliate of SOCAR. The
remaining 62.83% share in CGL is held by two affiliates of the project
operator, CNPC.
This announcement includes "forward-looking statements", including
statements with respect to Arawak's anticipated exploration and development
activities which are based on the opinions and estimates of management at the
date the statements are made, and are subject to a variety of risks and
uncertainties and other factors that could cause actual events or results to
differ materially from those projected in the forward-looking statements.
These risks and uncertainties include, but are not limited to, risks
associated with the oil and gas industry (including operational risks in
development, exploration and production; delays or changes in plans with
respect to exploration or development projects or capital expenditures; the
uncertainty of reserve estimates; the uncertainty of estimates and projections
in relation to production, costs and expenses and health, safety and
environmental risks), the risk of commodity price and foreign exchange rate
fluctuations, the uncertainty associated with commercial negotiations and
negotiating with foreign governments and risks associated with international
activity. Statements relating to "reserves" are deemed to be forward looking
statements as they involve the implied assessment, based on certain estimates
and assumptions, that the reserves described exist in the quantities predicted
or estimated and can be profitably produced in the future. Although Arawak
believes that its expectations represented by these forward-looking statements
are reasonable, there can be no assurance that such expectations will prove to
be correct. Due to the risks, uncertainties and assumptions inherent in
forward-looking statements, prospective investors in the Company's securities
should not place undue reliance on these forward-looking statements. For a
detailed description of the risks and uncertainties facing Arawak, readers
should refer to Arawak's Annual Information Form for the year ended 31
December, 2007 and dated 31 March, 2008 as filed at www.sedar.com.APPENDIX 1
----------
Net present values of future net revenue based on forecast prices and
costs (thousands of $ (M$)):
Before Deducting
Income Taxes Discounted At
-----------------------------------------------------
0% 5% 10% 15% 20%
(M$) (M$) (M$) (M$) (M$)
--------- --------- --------- --------- ---------
Proved Developed
Producing(1)(5)
Kazakhstan 306,038 257,826 221,503 193,452 171,321
Russia 50,261 43,346 37,766 33,222 29,486
Azerbaijan 304 265 233 207 184
--------- --------- --------- --------- ---------
Total 356,603 - 301,437 - 259,502 - 226,881 - 200,992 -
--------- --------- --------- --------- ---------
Proved Developed
Non-Producing(1)(6)
Kazakhstan - - - - - - - - - -
Russia 15,025 11,954 9,624 7,835 6,448
Azerbaijan 2,035 1,649 1,352 1,120 937
--------- --------- --------- --------- ---------
Total 17,060 - 13,603 - 10,975 - 8,955 - 7,385 -
--------- --------- --------- --------- ---------
Proved
Undeveloped(1)(7)
Kazakhstan 220,103 166,296 128,744 101,717 81,739
Russia 11,094 9,444 8,067 6,912 5,939
Azerbaijan 73,126 45,551 27,613 15,903 8,251
--------- --------- --------- --------- ---------
Total 304,323 - 221,291 - 164,424 - 124,532 - 95,930 -
--------- --------- --------- --------- ---------
TOTAL PROVED(1)
Kazakhstan 526,140 - 424,122 - 350,247 - 295,170 - 253,060 -
Russia 76,379 - 64,744 - 55,456 - 47,970 - 41,874 -
Azerbaijan 75,465 - 47,465 - 29,199 - 17,230 - 9,372 -
--------- --------- --------- --------- ---------
Total 677,984 - 536,331 - 434,902 - 360,370 - 304,306 -
--------- --------- --------- --------- ---------
TOTAL PROBABLE(2)
Kazakhstan 413,804 295,749 219,389 167,829 131,713
Russia 16,607 14,125 12,051 10,311 8,844
Azerbaijan 235,352 169,110 123,818 92,126 69,488
--------- --------- --------- --------- ---------
Total 665,764 - 478,983 - 355,258 - 270,266 - 210,045 -
--------- --------- --------- --------- ---------
TOTAL PROVED PLUS
PROBABLE(1)(2)
Kazakhstan 939,943 - 719,871 - 569,636 - 462,999 - 384,772 -
Russia 92,987 - 78,868 - 67,507 - 58,281 - 50,718 -
Azerbaijan 310,817 - 216,575 - 153,017 - 109,356 - 78,860 -
--------- --------- --------- --------- ---------
Total 1,343,747 - 1,015,314 - 790,160 - 630,636 - 514,350 -
--------- --------- --------- --------- ---------
TOTAL POSSIBLE(3)
Kazakhstan 692,371 504,554 381,290 296,905 237,039
Russia 16,583 13,535 - 11,172 - 9,314 - 7,837 -
Azerbaijan 139,223 89,423 58,710 39,196 26,483
--------- --------- --------- --------- ---------
Total 848,177 - 607,512 - 451,172 - 345,415 - 271,360 -
--------- --------- --------- --------- ---------
TOTAL PROVED PLUS
PROBABLE PLUS
POSSIBLE
Kazakhstan 1,632,314 - 1,224,425 - 950,927 - 759,904 - 621,811 -
Russia 109,569 - 92,403 - 78,679 - 67,595 - 58,555 -
Azerbaijan 450,040 - 305,998 - 211,727 - 148,552 - 105,344
--------- --------- --------- --------- ---------
Total 2,191,924 - 1,622,826 - 1,241,333 - 976,051 - 785,710
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
Net Unit
Value Before
Income Tax
After Deducting Discounted At
Incoming Taxes Discounted At 10%/year
-----------------------------------------------------------
0% 5% 10% 15% 20%
(M$) (M$) (M$) (M$) (M$) ($/boe)
--------- --------- ------- ------- ---------------
Proved Developed
Producing(1)(5)
Kazakhstan 241,454 203,055 174,183 151,926 134,394 16.15
Russia 44,379 38,226 33,288 29,286 26,009 6.83
Azerbaijan 304 265 233 207 184 3.90
--------- --------- ------- ------- ---------------
Total 286,137 - 241,546 - 207,704 - 181,419 - 160,587 13.44
--------- --------- ------- ------- ---------------
Proved
Developed Non-
Producing(1)(6)
Kazakhstan - - - - - - - - -
Russia 11,946 9,566 7,746 6,340 5,243 7.45
Azerbaijan 2,035 1,649 1,352 1,120 937 4.47
--------- --------- ------- ------- ---------------
Total 13,981 - 11,215 - 9,097 - 7,460 - 6,180 6.89
--------- --------- ------- ------- ---------------
Proved Undevel-
oped(1)(7)
Kazakhstan 147,153 108,805 82,375 63,574 49,828 18.50
Russia 8,655 7,359 6,274 5,362 4,592 6.98
Azerbaijan 73,126 45,551 27,613 15,903 8,251 4.94
--------- --------- ------- ------- ---------------
Total 228,934 - 161,715 - 116,262 - 84,839 - 62,671 4.75
--------- --------- ------- ------- ---------------
TOTAL PROVED(1)
Kazakhstan 388,607 - 311,859 - 256,558 - 215,501 - 184,222 16.94
Russia 64,981 - 55,150 - 47,307 - 40,987 - 35,844 6.95
Azerbaijan 75,465 - 47,465 - 29,199 - 17,230 - 9,372 4.91
--------- --------- ------- ------- ---------------
Total 529,052 - 414,475 - 333,064 - 273,718 - 229,438 12.57
--------- --------- ------- ------- ---------------
TOTAL
PROBABLE(2)
Kazakhstan 280,405 195,853 141,973 106,097 81,294 17.31
Russia 12,721 10,805 9,198 7,845 6,700 8.23
Azerbaijan 235,352 169,110 123,818 92,126 69,488 13.73
--------- --------- ------- ------- ---------------
Total 528,479 - 375,768 - 274,989 - 206,068 - 157,482 15.34
--------- --------- ------- ------- ---------------
TOTAL PROVED
PLUS
PROBABLE(1)(2)
Kazakhstan 669,011 - 507,713 - 398,531 - 321,597 - 265,515 17.08
Russia 77,702 - 65,955 - 56,505 - 48,832 - 42,544 7.15
Azerbaijan 310,817 - 216,575 - 153,017 - 109,356 - 78,860 10.22
--------- --------- ------- ------- ---------------
Total 1,057,530 - 790,243 - 608,053 - 479,785 - 386,919 13.68
--------- --------- ------- ------- ---------------
TOTAL
POSSIBLE(3)
Kazakhstan 451,819 325,661 243,950 188,623 149,730 23.08
Russia 13,177 - 10,805 - 8,957 - 7,498 - 6,334 10.41
Azerbaijan 139,223 89,423 58,710 39,196 26,483 8.06
--------- --------- ------- ------- ---------------
Total 604,219 - 425,889 - 311,617 - 235,317 - 182,547 18.14
--------- --------- ------- ------- ---------------
TOTAL PROVED
PLUS PROBABLE
PLUS
POSSIBLE
Kazakhstan 1,120,830 - 833,374 - 642,481 - 510,221 - 415,246 19.07
Russia 90,879 - 76,760 - 65,462 - 56,330 - 48,878 7.48
Azerbaijan 450,040 - 305,998 - 211,727 - 148,552 - 105,344 9.52
--------- --------- ------- ------- ---------------
Total 1,661,749 - 1,216,132 - 919,670 - 715,103 - 569,468 15.02
--------- --------- ------- ------- ---------------
--------- --------- ------- ------- ---------------
(1) "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.
(2) "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.
(3) "Possible" reserves are those additional reserves that are less
certain to be recovered than probable reserves. It is unlikely that
the actual quantities recovered will exceed the sum of the estimated
proved plus probable plus possible reserves.
(4) "Developed" reserves are those reserves that are expected to be
recovered from existing wells and installed facilities or, if
facilities have not been installed, that would involve a low
expenditure (e.g. when compared to the cost of drilling a well) to
put the reserves on production.
(5) "Developed Producing" reserves are those reserves that are expected
to be recovered from completion intervals open at the time of the
estimate. These reserves may be currently producing or, if shut-in,
they must have previously been on production, and the date of
resumption of production must be known with reasonable certainty.
(6) "Developed Non-Producing" reserves are those reserves that either
have not been on production, or have previously been on production,
but are shut in, and the date of resumption of production is unknown.
(7) "Undeveloped" reserves are those expected to be recovered from known
accumulations where a significant expenditure (for example, when
compared to the cost of drilling a well) is required to render them
capable of production. They must fully meet the requirements of the
reserves classification (proved, probable, possible) to which they
are assigned.
The pricing assumptions used in the Kazakhstan McDaniel Report with
respect to net present values of future net revenue (forecast) are set forth
below. As a result of both economic and political forces, there is significant
uncertainty regarding the forecasting of future hydrocarbon prices. The
Kazakhstan McDaniel Report assumes 85% of Arawak's production from the Akzhar,
Besbolek and Karataikyz fields is sold at export price and 15% is sold at the
domestic price. For the Alimbai field the Kazakhstan McDaniel Report assumes
0% to be sold to the export markets in 2009 and 80% thereafter. Under the
terms of the Temir Production Sharing Agreement 100% of production from the
Saigak field is entitled to be exported. The domestic price excludes VAT.
Crude Oil
-------------------------------------------------------------------------
WTI Urals Akzhar
Cushing Urals Price Crude Oil Export Price
Date Oklahoma Brent Differential Price Differential
($/bbl) ($/bbl) ($2009/bbl) ($/bbl) $2009/bbl
-------------------------------------------------------------------------
2009 54.00 52.15 3.00 49.15 16.64
2010 65.00 63.21 3.00 60.15 16.64
2011 73.00 71.25 3.00 68.13 16.64
2012 82.00 80.30 3.00 77.11 16.64
2013 91.00 89.34 3.00 86.10 16.64
2014 93.00 91.35 3.00 88.04 16.64
2015 94.86 93.22 3.00 89.85 16.64
2016 96.76 95.13 3.00 91.69 16.64
2017 98.69 97.08 3.00 93.56 16.64
2018 100.67 99.06 3.00 95.48 16.64
2019 102.68 101.09 3.00 97.43 16.64
2020 104.73 103.15 3.00 99.42 16.64
2021 106.83 105.26 3.00 101.45 16.64
2022 108.96 107.40 3.00 103.52 16.64
2023 111.14 109.59 3.00 105.64 16.64
2024 111.14 109.59 3.00 105.64 16.64
2025 111.14 109.59 3.00 105.64 16.64
2026 111.14 109.59 3.00 105.64 16.64
2027 111.14 109.59 3.00 105.64 16.64
2028 111.14 109.59 3.00 105.64 16.64
-------------------------------------------------------------------------
Besbolek,
Karataikyz Besbolek, Besbolek,
Akzhar Akzhar & Alimbai Karataikyz Karataikyz
Export Domestic Export Price & Alimbai & Alimbai
Date Price Price Differential Export Price Domestic
($/bbl) ($/bbl) ($2009/bbl) ($/bbl) Price/($bbl)
-------------------------------------------------------------------------
2009 35.51 25.00 16.24 35.91 25.00
2010 46.23 25.00 16.24 46.64 25.00
2011 53.94 25.00 16.24 54.35 25.00
2012 62.64 28.19 16.24 63.06 28.38
2013 71.33 32.10 16.24 71.77 32.29
2014 72.98 32.84 16.24 73.42 33.04
2015 74.49 33.52 16.24 74.94 33.72
2016 76.02 34.21 16.24 76.48 34.41
2017 77.58 34.91 16.24 78.05 35.12
2018 79.18 35.63 16.24 79.65 35.84
2019 80.80 36.36 16.24 81.29 36.58
2020 82.46 37.11 16.24 82.96 37.33
2021 84.15 37.87 16.24 84.66 38.10
2022 85.88 38.65 16.24 86.40 38.88
2023 87.64 39.44 16.24 88.17 39.67
2024 87.64 39.44 16.24 88.17 39.67
2025 87.64 39.44 16.24 88.17 39.67
2026 87.64 39.44 16.24 88.17 39.67
2027 87.64 39.44 16.24 88.17 39.67
2028 87.64 39.44 16.24 88.17 39.67
Crude Oil
-------------------------------------------------------------------------
Saigak
Export
Price
Differ- Saigak Saigak
WTI Cushing ential Export Domestic Inflation
Oklahoma Brent ($2009 Price Price Forecast
Date ($/bbl) ($/bbl) /bbl) ($/bbl) ($/bbl) %
-------------------------------------------------------------------------
2009 54.00 52.15 16.50 35.65 25.00 2.0
2010 65.00 63.21 16.83 46.38 25.00 2.0
2011 73.00 71.25 17.17 54.08 25.00 2.0
2012 82.00 80.30 17.51 62.79 28.25 2.0
2013 91.00 89.34 17.86 71.48 32.17 2.0
2014 93.00 91.35 18.22 73.14 32.91 2.0
2015 94.86 93.22 18.58 74.64 33.59 2.0
2016 96.76 95.13 18.95 76.18 34.28 2.0
2017 98.69 97.08 19.33 77.75 34.99 2.0
2018 100.67 99.06 19.72 79.34 35.70 2.0
2019 102.68 101.09 20.11 80.97 36.44 2.0
2020 104.73 103.15 20.52 82.63 37.19 2.0
2021 106.83 105.26 20.93 84.33 37.95 2.0
2022 108.96 107.40 21.34 86.06 38.73 2.0
2023 111.14 109.59 21.77 87.82 39.52 2.0
2024 111.14 109.59 21.77 87.82 39.52 0.0
2025 111.14 109.59 21.77 87.82 39.52 0.0
2026 111.14 109.59 21.77 87.82 39.52 0.0
2027 111.14 109.59 21.77 87.82 39.52 0.0
2028 111.14 109.59 21.77 87.82 39.52 0.0
The pricing assumptions used in the Russia Ryder Scott Report with respect
to net present values of future net revenue (forecast) are set forth below. As
a result of both economic and political forces, there is significant
uncertainty regarding the forecasting of future hydrocarbon prices.
Crude Oil
-------------------------------------------------------------------------
WTI
Cushing
Oklahoma Brent Urals Export Domestic Blend(1) Netback
Date ($/bbl) ($/bbl) ($/bbl) ($/bbl) ($/bbl) ($/bbl) Price
-------------------------------------------------------------------------
2009 54.00 52.15 50.15 47.15 28.80 36.14 14.31
2010 65.00 63.21 61.21 58.21 35.55 44.62 16.69
2011 73.00 71.25 69.25 66.25 40.47 50.78 18.43
2012 82.00 80.30 78.30 75.30 45.99 57.71 20.37
2013 91.00 89.34 87.34 84.34 51.52 64.65 22.32
2014 93.00 91.35 89.35 86.35 52.75 66.19 22.76
2015 94.86 93.22 91.22 88.22 53.89 67.62 23.16
2016 96.76 95.13 93.13 90.13 55.06 69.09 23.57
2017 98.69 97.08 95.08 92.08 56.24 70.58 23.99
2018 100.67 99.06 97.06 94.06 57.46 72.10 24.42
2019 102.68 101.09 99.09 96.09 58.69 73.65 24.85
2020 104.73 103.15 101.15 98.15 59.95 75.23 25.30
2021 106.83 105.26 103.26 100.26 61.24 76.85 25.75
2022 108.96 107.40 105.40 102.40 62.55 78.49 26.21
2023 111.14 109.59 107.59 104.59 63.89 80.17 26.68
2024 111.14 109.59 107.59 104.59 63.89 80.17 26.68
2025 111.14 109.59 107.59 104.59 63.89 80.17 26.68
2026 111.14 109.59 107.59 104.59 63.89 80.17 26.68
2027 111.14 109.59 107.59 104.59 63.89 80.17 26.68
2028 111.14 109.59 107.59 104.59 63.89 80.17 26.68
(1) Blend assumes export sales 40% and domestic sales 60%
The pricing assumptions used in the Azerbaijan Ryder Scott Report with
respect to net present values of future net revenue (forecast) for the proved
plus probable case are set forth below. As a result of both economic and
political forces, there is significant uncertainty regarding the forecasting
of future hydrocarbon prices.
Crude Oil Natural Gas
-------------------------------------------------------------------------
WTI Cushing
Oklahoma Brent Urals Export SW Gobustan
Date ($/bbl) ($/bbl) ($/bbl) ($/bbl) ($/mcf)
-------------------------------------------------------------------------
2009 54.00 52.15 47.98 43.94 1.33
2010 65.00 63.21 58.15 54.04 2.76
2011 73.00 71.25 65.55 61.35 2.80
2012 82.00 80.30 73.87 69.59 2.82
2013 91.00 89.34 82.20 77.83 2.82
2014 93.00 91.35 84.05 79.59 2.82
2015 94.86 93.22 85.77 81.23 2.83
2016 96.76 95.13 87.52 82.89 2.83
2017 98.69 97.08 89.31 84.59 2.83
2018 100.67 99.06 91.14 86.32 2.83
2019 102.68 101.09 93.00 88.08 2.83
2020 104.73 103.15 94.90 89.88 2.83
2021 106.83 105.26 96.84 91.72 2.83
2022 108.96 107.40 98.81 93.60 2.83
2023 111.14 109.59 100.83 95.51 2.83
2024 111.14 109.59 100.83 95.51 2.83
2025 111.14 109.59 100.83 95.51 2.83
2026 111.14 109.59 100.83 95.51 2.83
2027 111.14 109.59 100.83 95.51 2.83
2028 111.14 109.59 100.83 95.51 2.83
(1) In the Azerbaijan, after tax income is equal to before tax income as
the State Oil Company of the Azerbaijan Republic ("SOCAR") pays taxes
on behalf of the Company.
(2) For the proved case, the forecast price of natural gas for the SW
Gobustan EDPSA was held constant at $1.33/mcf. The gas price used for
the proved plus probable scenario was flat $2.83/mcf for the life of
the project. The terms of the South West Gobustan EDPSA allows for
future changes in gas pricing.
For further information: Arawak Energy Limited, Tanya Pang, Head of
Investor Relations, E-mail: info@arawakenergy.com, Tel: +44 (0) 20 7973 4285,
Fax: +44 (0) 20 7824 8466, Web: www.arawakenergy.com; Brunswick Group LLP,
Patrick Handley, Tel: +44 (0)20 7404 5959; JPMorgan Cazenove Limited, Steve
Baldwin, Neil Haycock, Tel: +44 (0)20 7588 2828; Oriel Securities Limited,
Richard Crawley, Natalie Fortescue, Tel: +44 (0)20 7710 7600
