Calvalley Petroleum Inc., (TSX: CVI.A) provides 2014 reserves update

CALGARY, Feb. 17, 2015 /CNW/ - Calvalley Petroleum Inc. ("Calvalley" or the "Company") announces the results of its December 31, 2014 reserves evaluation.

The reserves evaluation was conducted by McDaniel & Associates Consultants Ltd. ("McDaniel") who prepared an independent engineering evaluation of the reserves attributable to the Company's 50% working interest in Block 9 in a report dated January 30, 2015 with an effective date of December 31, 2014 (the "McDaniel Report") in accordance with National Instrument 51 101 - Standards of Disclosure for Oil and Gas Activities ("NI 51-101") and the Canadian Oil and Gas Evaluation Handbook ("COGE Handbook").

The following information is derived from the McDaniel Report.

Company interest proved reserves of crude oil of 10.1 million barrels declined from 11.5 million barrels in 2013. Similarly company interest proved plus probable reserves of crude oil of 20.9 million barrels declined from 22.9 million barrels in 2013.

The following information is derived from the McDaniel Report:

Summary of Oil and Gas Reserves-Company Interest



Light and Medium
Oil



Heavy Oil



Total Crude Oil

Reserves Category


 (Mbbl)


(Mbbl)


(Mbbl)

Proved(1)








Developed Producing


3,775


565


4,339


Undeveloped


3,705


2,022


5,727

Total Proved


7,479


2,587


10,066

Probable(2)


8,898


1,961


10,859

Total Proved plus Probable


16,378


4,547


20,925

Possible(3)


6,634


1,098


7,731

Total


23,011


5,645


28,656








Notes:

(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. There is a ten per cent probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible reserves. It is unlikely that the actual remaining quantities recovered will exceed the sum of the estimated proved plus probable plus possible reserves.

Summary of Net Present Value of Future Net Revenue


Before Income Tax Expenses Discounted at
(%/year)

Reserves Category

0
(M$US)


5
(M$US)


10
(M$US)


15
(M$US)


20
(M$US)

Proved











Developed Producing

75,803


63,525


54,509


47,687


42,388


 Undeveloped

132,085


93,341


67,742


50,345


38,218

Total Proved

207,889


156,866


122,250


98,032


80,606

Probable

306,664


190,288


124,265


84,863


60,235

Total Proved plus Probable

514,553


347,155


246,516


182,895


140,841

Possible

223,900


147,834


102,776


74,690


56,369

Total

738,453


494,989


349,291


257,585


197,211












After Income Tax Expenses Discounted at
(%/year)

Reserves Category

0
(M$US)


5
(M$US)


10
(M$US)


15
(M$US)


20
(M$US)

Proved











 Developed Producing

50,566


43,037


37,408


33,082


29,673


 Undeveloped

86,556


60,579


43,442


31,821


23,742

Total Proved

137,122


103,615


80,850


64,903


53,415

Probable

199,578


123,551


80,370


54,574


38,435

Total Proved plus Probable

336,700


227,166


161,221


119,476


91,850

Possible

145,535


96,023


66,699


48,428


36,516

Total

482,234


323,190


227,920


167,904


128,366











Notes:

(1) The McDaniel Report employed the following pricing assumptions for Brent Crude Oil as of January 1, 2015 in estimating the reserves data using forecast prices and costs:  2015 US$ 69.83;   2016 US$ 78.06;   2017 US$ 83.07;   2018 US$ 88.08;  2019 US$ 92.49;   2020 US$ 97.10; 2021 US$ 99.01

(2) The weighted average realized sales price for Block 9 crude oil for the year ended December 31, 2014 was US$86.71 per barrel.

About Calvalley

Calvalley is an international oil and gas company, with offices in Calgary, Alberta, Canada, that operates Block 9 of the Masila Basin, in The Republic of Yemen.

Forward Looking Information

Certain information included in this press release constitutes forward-looking information under applicable securities legislation. This press release includes information pertaining to the reserves and the net present value of future net revenue of the Company as at December 31, 2014 as evaluated by McDaniel in the McDaniel Report. Statements relating to "reserves" are by their nature forward-looking information, as they involve the implied assessment, based on certain estimates and assumptions that the reserves described can be profitably produced in the future. The McDaniel Report is based on a number of assumptions relating to a variety of factors including the timing and amount of capital expenditures, forecast prices and costs, production rates and ultimate recovery of reserves. Reserve estimates provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Moreover, no assurance can be given that the forecast prices and cost assumptions used in the McDaniel Report will be attained and variances could be significant. As a consequence, actual results may differ materially from those anticipated in the forward looking information. The net present value of future net revenue referred to herein should not be construed as the fair market value of the estimated reserves of the Company's properties.

The material assumptions and risk factors that could influence the forward looking information are contained in the Company's annual information form for the year ended December 31, 2013 dated March 18, 2014 and Management's Discussion and Analysis for the nine months ended September 30, 2014 which are available under the Company's issuer profile on SEDAR at www.sedar.com and which are incorporated herein by reference.

Forward-looking information involves significant risk and uncertainties. Although the forward-looking information contained herein is based upon what management believes to be reasonable assumptions, management cannot assure that actual results will be consistent with the forward-looking information. Investors should not place undue reliance on forward-looking information. Forward looking information is made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws.

SOURCE Calvalley Petroleum Inc.

For further information: investorrelations@calvalleypetroleum.com or +1 (403) 297-0490, Edmund Shimoon, Chairman and CEO, Gerry Elms, CFO

RELATED LINKS
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