Vermilion Energy Inc. Announces 2016 Year-end Summary Reserves and Resource Information

CALGARY, Feb. 27, 2017 /CNW/ - Vermilion Energy Inc. ("Vermilion", the "Company", "We" or "Our") (TSX, NYSE: VET) is pleased to announce summary 2016 year-end reserves and resource information. The estimates of reserves and resources and other oil and gas information contained in this news release have been estimated by GLJ Petroleum Consultants Ltd. ("GLJ") effective as at December 31, 2016 and prepared in accordance with National Instrument 51-101 "Standards of Disclosure for Oil and Gas Activities" of the Canadian Securities Administrators ("NI 51-101") and the Canadian Oil and Gas Evaluation Handbook ("COGEH"). For additional information about Vermilion, including Vermilion's statement of reserves data and other information in Form 51-101F1, report on reserves data by independent qualified reserves evaluator or auditor in Form 51-101F2 and report of management and directors on oil and gas disclosure in Form 51-101F3, please review the Company's Annual Information Form for the year ended December 31, 2016, to be filed on February 27, 2017 and available on SEDAR at www.sedar.com and on the SEC's EDGAR system at www.sec.gov.

HIGHLIGHTS

  • Total proved ("1P") reserves increased 9% to 175.8 mmboe(1), while total proved plus probable ("2P") reserves increased 11% to 290.1 mmboe(1). This represents year-over-year 1P and 2P per share reserves growth of 4% and 5%, respectively.
  • Finding and Development ("F&D")(2) and Finding, Development and Acquisition ("FD&A")(2) costs, including Future Development Capital ("FDC") for 2016 on a 2P basis decreased 38% to $5.57/boe and 34% to $6.62/boe, respectively. Our three-year F&D and FD&A costs, including FDC, on a 2P basis were $10.76/boe and $14.22/boe, respectively.
  • Achieved a further $33.7 million (2%) reduction in FDC costs (excluding FDC related to properties acquired during the year) due to additional reductions in drilling, completions and facility capital costs. FDC costs related to properties acquired during the year totalled $40.3 million.
  • Operating Recycle Ratio(3) (including FDC) was 4.9x during 2016, an increase over the 3.6x achieved during 2015. The impact of lower commodity prices year-over-year was more than offset by lower F&D costs and per unit expenses. These improvements are a result of Vermilion's continued focus on cost reduction and investment efficiency.
  • In 2016, we added 52.5 mmboe of 2P reserves with 37.5 mmboe (70%) of additions coming from organic exploration and development ("E&D") activities and 15.0 mmboe (30%) of additions through acquisitions.
  • Replaced 161% of production at the 2P level through E&D related activities and 226% including acquisitions. At the 1P level, we replaced 119% and 165% of 2016 production, respectively.
  • Increased Proved Developed Producing ("PDP") reserves by 11% to 122.2 mmboe at an average F&D cost (including FDC) of $6.68/boe resulting in an Operating Recycle Ratio(3) (including FDC) of 4.1x. PDP reserves represent 70% of 1P reserves.
  • Our independent GLJ 2016 Resource Assessment(4) indicates risked low, best, and high estimates for contingent resources in the Development Pending category of 120.4(4) mmboe, 198.5(4) mmboe, and 309.4(4) mmboe, representing increases of 27%, 24% and 21%, respectively, compared to our GLJ 2015 Resource Assessment(5). The GLJ 2016 Resource Assessment also indicates risked low, best, and high estimates for contingent resources in the Development Unclarified category of 9.9(4) mmboe, 19.5(4) mmboe, and 28.7(4) mmboe. Over 90% of our risked contingent resources reside in the Development Pending category, reflecting the high quality nature of our contingent resource base. Prospective resources were assessed at risked low, best and high estimates of 45.2(4) mmboe, 89.5(4) mmboe, and 147.9(4) mmboe.
  • At year-end 2016, 2P reserves were comprised of 31% Brent-based light crude, 15% North American-based light crude, 11% natural gas liquids, 21% European natural gas and 22% North American natural gas.
  • Increased reserve life index for 2P reserves to 13.1 years for year-end 2016 reserves based on annualized Q4 2016 production, compared to 11.7 years at year-end 2015. Year-end 2016 reserve life index for 1P reserves increased to 7.9 years, as compared to 7.2 years at year-end 2015.
  • Ongoing technical work associated with the German asset acquisition announced in Q2 2016 resulted in the identification of an additional ten (6.3 net) locations and related 2P reserves of approximately 6.3 mmboe.
  • In our Mannville condensate and liquids-rich gas plays in Alberta we added, at the 2P level, an additional eight (7.0 net) undeveloped wells in the West Pembina area and nine (7.0 net) wells in the Ferrier area. The average net reserves additions per well were approximately 620 mboe/well in West Pembina and 850 mboe/well in Ferrier.
  • We added ten (9.0 net) 2P locations at an average of 350 mboe per well in our emerging Turner Sand light crude oil development project in the Powder River Basin in Wyoming.

(1)

As evaluated by GLJ Petroleum Consultants Ltd. ("GLJ") in a report dated February 1, 2017 with an effective date of December 31, 2016.

(2)

F&D (finding and development) and FD&A (finding, development and acquisition) costs are used as a measure of capital efficiency and are calculated by dividing the applicable capital expenditures for the period, including the change in undiscounted future development capital ("FDC"), by the change in the reserves, incorporating revisions and production, for the same period.

(3)

"Operating Recycle Ratio" is a measure of capital efficiency calculated by dividing the Operating Netback by the cost of adding reserves (F&D cost). "Operating Netback" is calculated as sales less royalties, operating expense, transportation costs, PRRT and realized hedging gains and losses presented on a per unit basis.

(4)

Vermilion retained GLJ to conduct an independent resource evaluation dated February 1, 2017 to assess contingent and prospective resources across all of the Company's key operating regions with an effective date of December 31, 2016 (the "GLJ 2016 Resource Assessment"). The aggregate associated chance of development for each of the low, best and high estimate for contingent resources in the Development Pending category are 84%, 83% and 82%, respectively. The aggregate associated chance of development for each of the low, best and high estimate for contingent resources in the Development Unclarified category are 55%, 54% and 55%, respectively. The aggregate associated chance of commerciality for each of the low, best and high estimate for prospective resources in the Prospect category are 25%, 26% and 26%, respectively. There is uncertainty that it will be commercially viable to produce any portion of the resources.

(5)

Vermilion retained GLJ to conduct an independent resource evaluation dated February 8, 2016 to assess contingent resources across all of the Company's key operating regions with an effective date of December 31, 2015 (the "GLJ 2015 Resource Assessment"). The aggregate associated chance of development for each of the low, best and high estimate for contingent resources in the Development Pending category are 83%, 82% and 81%, respectively. There is uncertainty that it will be commercially viable to produce any portion of the resources. For further information, see the "Contingent Resources" section of this news release.

DISCLAIMER

Certain statements included or incorporated by reference in this news release may constitute forward looking statements or financial outlooks under applicable securities legislation. Such forward looking statements or information typically contain statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", or similar words suggesting future outcomes or statements regarding an outlook. Forward looking statements or information in this news release may include, but are not limited to:

  • capital expenditures;
  • business strategies and objectives;
  • estimated reserve quantities and the discounted present value of future net cash flows from such reserves;
  • petroleum and natural gas sales;
  • future production levels (including the timing thereof) and rates of average annual production growth, estimated contingent resources and prospective resources;
  • exploration and development plans;
  • acquisition and disposition plans and the timing thereof;
  • operating and other expenses, including the payment of future dividends;
  • royalty and income tax rates;
  • the timing of regulatory proceedings and approvals; and
  • the estimate of Vermilion's share of the expected natural gas production from the Corrib field.

Such forward-looking statements or information are based on a number of assumptions all or any of which may prove to be incorrect. In addition to any other assumptions identified in this document, assumptions have been made regarding, among other things:

  • the ability of the Company to obtain equipment, services and supplies in a timely manner to carry out its activities in Canada and internationally;
  • the ability of the Company to market crude oil, natural gas liquids and natural gas successfully to current and new customers;
  • the timing and costs of pipeline and storage facility construction and expansion and the ability to secure adequate product transportation;
  • the timely receipt of required regulatory approvals;
  • the ability of the Company to obtain financing on acceptable terms;
  • foreign currency exchange rates and interest rates;
  • future crude oil, natural gas liquids and natural gas prices; and
  • Management's expectations relating to the timing and results of development activities.

Although the Company believes that the expectations reflected in such forward looking statements or information are reasonable, undue reliance should not be placed on forward looking statements because the Company can give no assurance that such expectations will prove to be correct. Financial outlooks are provided for the purpose of understanding the Company's financial strength and business objectives and the information may not be appropriate for other purposes. Forward looking statements or information are based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by the Company and described in the forward looking statements or information. These risks and uncertainties include but are not limited to:

  • the ability of management to execute its business plan;
  • the risks of the oil and gas industry, both domestically and internationally, such as operational risks in exploring for, developing and producing crude oil, natural gas liquids and natural gas;
  • risks and uncertainties involving geology of crude oil, natural gas liquids and natural gas deposits;
  • risks inherent in the Company's marketing operations, including credit risk;
  • the uncertainty of reserves estimates and reserves life and estimates of resources and associated expenditures;
  • the uncertainty of estimates and projections relating to production, costs and expenses;
  • potential delays or changes in plans with respect to exploration or development projects or capital expenditures;
  • the Company's ability to enter into or renew leases on acceptable terms;
  • fluctuations in crude oil, natural gas liquids and natural gas prices, foreign currency exchange rates and interest rates;
  • health, safety and environmental risks;
  • uncertainties as to the availability and cost of financing;
  • the ability of the Company to add production and reserves through exploration and development activities;
  • general economic and business conditions;
  • the possibility that government policies or laws may change or governmental approvals may be delayed or withheld;
  • uncertainty in amounts and timing of royalty payments;
  • risks associated with existing and potential future law suits and regulatory actions against the Company; and
  • other risks and uncertainties described elsewhere in the annual information form of the Company for the year ended December 31, 2016 or in the Company's other filings with Canadian securities authorities.

The forward-looking statements or information contained in this news release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws.

RESERVES, FUTURE NET REVENUE AND OTHER OIL AND GAS INFORMATION

The following is a summary of the oil and natural gas reserves and the value of future net revenue of Vermilion as evaluated by GLJ, independent petroleum engineering consultants in Calgary in a report dated February 1, 2017 with an effective date of December 31, 2016 (the "GLJ 2016 Reserves Evaluation"). The GLJ 2016 Reserves Evaluation was prepared in accordance with National Instrument 51-101 and COGEH.

Reserves and other oil and gas information in this news release is effective December 31, 2016 unless otherwise stated.

All evaluations of future net production revenue set forth in the tables below are stated after overriding and lessor royalties, Crown royalties, freehold royalties, mineral taxes, direct lifting costs, normal allocated overhead and future capital investments, including abandonment and reclamation obligations. Future net production revenues estimated by the GLJ 2016 Reserves Evaluation do not represent the fair market value of the reserves. Other assumptions relating to the costs, prices for future production and other matters are included in the GLJ 2016 Reserve Evaluation. There is no assurance that the future price and cost assumptions used in the GLJ 2016 Reserves Evaluation will prove accurate and variances could be material.

Reserves for Australia, Canada, France, Germany, Ireland, the Netherlands and the United States are established using deterministic methodology. Total proved reserves are established at the 90 percent probability (P90) level. There is a 90 percent probability that the actual reserves recovered will be equal to or greater than the P90 reserves. Total proved plus probable reserves are established at the 50 percent probability (P50) level. There is a 50 percent probability that the actual reserves recovered will be equal to or greater than the P50 reserves.

Estimates of reserves have been made assuming that development of each property, in respect of which estimates have been made, will occur without regard to the availability of funding required for that development.

With respect to finding and development costs, the aggregate of the exploration and development costs incurred in the most recent financial year and the change during that year in estimated future development costs generally will not reflect total finding and development costs related to reserve additions for that year.

Pricing used in the forecast price estimates is set forth in the table below and referenced in the notes to subsequent tables.

Table 1: Forecast Prices used in Estimates (1)

Light Crude Oil and

& Medium Crude Oil

Crude Oil

Conventional

Natural Gas

Canada

Conventional

Natural Gas

Europe

Natural Gas

Liquids

Inflation

Rate

Exchange Rate

Exchange Rate

WTI

Edmonton

Cromer

Brent Blend

National Balancing

Cushing

Par Price

Medium

FOB

AECO

Point

FOB

Oklahoma

40˚ API

29.3˚ API

North Sea

Gas Price

(UK)

Field Gate

Percent

Year

($US/bbl)

($Cdn/bbl)

($Cdn/bbl)

($US/bbl)

($Cdn/MMBtu)

($US/MMBtu)

($Cdn/bbl)

Per Year

($US/$Cdn)

($CdnEUR)

2016

43.30

52.95

48.71

45.01

2.19

4.65

34.50

1.50

0.76

1.47

Forecast

2017

55.00

69.33

64.48

57.00

3.46

5.75

40.40

2.00

0.75

1.40

2018

59.00

72.26

67.20

61.00

3.10

6.00

41.41

2.00

0.78

1.35

2019

64.00

75.00

69.75

66.00

3.27

6.25

42.94

2.00

0.80

1.31

2020

67.00

76.36

71.02

70.00

3.49

6.50

43.77

2.00

0.83

1.27

2021

71.00

78.82

73.31

74.00

3.67

6.75

45.24

2.00

0.85

1.24

2022

74.00

82.35

76.59

77.00

3.86

6.89

47.30

2.00

0.85

1.24

2023

77.00

85.88

79.87

80.00

4.05

7.02

49.25

2.00

0.85

1.24

2024

80.00

89.41

83.15

83.00

4.16

7.16

51.23

2.00

0.85

1.24

2025

83.00

92.94

86.44

86.00

4.24

7.31

53.42

2.00

0.85

1.24

2026

86.05

95.61

88.92

89.64

4.32

7.45

54.80

2.00

0.85

1.24

Thereafter

+2.0%/yr

+2.0%/yr

+2.0%/yr

+2.0%/yr

+2.0%/yr

+2.0%/yr

+2.0%/yr

2.0%

0.850

1.235

Note:

(1)

The pricing assumptions used in the GLJ Report with respect to net present value of future net revenue (forecast) as well as the inflation rates used for operating and capital costs are set forth above. The NGL price is an aggregate of the individual natural gas liquids prices used in the Total Proved plus Probable evaluation. GLJ is an independent qualified reserves evaluator appointed pursuant to NI 51-101.

All forecast prices in the tables above are provided by GLJ. For 2016, the price of crude oil in the United States is based on WTI. The benchmark price for Canadian crude oil is Edmonton Par and Canadian natural gas is priced against AECO. The benchmark price for Australia and France crude oil is Dated Brent. The price of our natural gas in Ireland is based on the NBP index. The price of Vermilion's natural gas in the Netherlands is based on the TTF day-ahead index, as determined on the Title Transfer Facility Virtual Trading Point. The price of Vermilion's natural gas in Germany is based on the TTF, as determined on the Title Transfer Facility Virtual Trading Point. For the year ended December 31, 2016, the average realized sales prices before hedging were $46.89 per bbl (United States) for WTI, $43.58 per bbl for Canadian-based crude oil, condensate and NGLs and $2.14 per Mcf for Canadian natural gas, $60.33 per bbl (Australia), $55.42 per bbl (France) for Brent-based crude oil, $5.86 per Mcf (Ireland), $5.67 per Mcf (Netherlands), and $5.33 per Mcf (Germany).

The following table summarizes the capital expenditures made by Vermilion on oil and natural gas properties for the year ended December 31, 2016:

Table 2: Capital Costs Incurred

Acquisition Costs

Proved

Unproved

Exploration

Development

Total

(M$)

Properties

Properties

Costs

Costs

Costs

Australia

-

-

-

59,910

59,910

Canada

13,309

-

-

62,706

76,015

Croatia

-

-

2,968

-

2,968

France

-

-

-

68,472

68,472

Germany

48,377

-

-

3,803

52,180

Hungary

-

-

338

-

338

Ireland

-

-

-

9,375

9,375

Netherlands

28,259

-

-

23,740

51,999

United States

5,935

-

-

13,539

19,474

Total

95,880

-

3,306

241,545

340,731

The following table sets forth the reserve life index based on total proved and proved plus probable reserve and fourth quarter 2016 production of 60,863 boe/d.

Table 3: Reserve Life Index

Commodity

Production

Reserve Life Index (years)

Fourth Quarter 2016

Total Proved

Proved Plus Probable

Crude oil, condensate and natural gas liquids (bbl/d)

28,439

9.9

15.9

Natural gas (mmcf/d)

194.54

6.2

10.6

Oil Equivalent (boe/d)

60,863

7.9

13.1

The following tables provide reserves data and a breakdown of future net revenue by component and production group using forecast prices and costs. For Canada, the tables following include Alberta gas cost allowance.

The following tables may not total due to rounding.

Table 4: Oil and Gas Reserves - Based on Forecast Prices and Costs (1)

Light Crude Oil & Medium Crude Oil

Heavy Oil

Tight Oil

Conventional Natural Gas

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(MMcf)

(MMcf)

Proved Developed Producing (3) (5) (6)

Australia

10,718

10,718

-

-

-

-

-

-

Canada

12,277

10,990

-

-

12

8

112,918

101,728

France

36,481

33,478

-

-

-

-

5,412

5,024

Germany

4,805

4,706

-

-

-

-

30,892

27,510

Ireland

-

-

-

-

-

-

95,861

95,861

Netherlands

-

-

-

-

-

-

41,494

29,860

United States

699

551

-

-

-

-

696

552

Total Proved Developed Producing

64,980

60,443

-

-

12

8

287,273

260,535

Shale Gas

Coal Bed Methane

Natural Gas Liquids

BOE

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross

Net

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

Proved Developed Producing (3) (5) (6)

Australia

-

-

-

-

-

-

10,718

10,718

Canada

1,371

1,291

2,482

2,275

8,484

6,395

40,235

34,942

France

-

-

-

-

-

-

37,383

34,315

Germany

-

-

-

-

-

-

9,954

9,291

Ireland

-

-

-

-

-

-

15,977

15,977

Netherlands

-

-

-

-

59

59

6,975

5,036

United States

-

-

-

-

97

76

912

719

1,371

1,291

2,482

2,275

8,640

6,530

122,154

110,998

Light Crude Oil & Medium

Crude Oil

Heavy Oil

Tight Oil

Conventional Natural Gas

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(MMcf)

(MMcf)

Proved Developed Non-Producing

Australia

700

700

-

-

-

-

-

-

Canada

1,008

874

-

-

-

-

24,705

22,319

France

1,814

1,666

-

-

-

-

-

-

Germany

240

230

-

-

-

-

8,227

7,389

Ireland

-

-

-

-

-

-

-

-

Netherlands

-

-

-

-

-

-

17,815

15,327

United States

-

-

-

-

-

-

-

-

Total Proved Developed Non-Producing

3,762

3,470

-

-

-

-

50,747

45,035

Shale Gas

Coal Bed Methane

Natural Gas Liquids

BOE

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross

Net

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

Proved Developed Non-Producing

Australia

-

-

-

-

-

-

700

700

Canada

-

-

2,536

2,389

1,649

1,283

7,197

6,275

France

-

-

-

-

-

-

1,814

1,666

Germany

-

-

-

-

-

-

1,611

1,462

Ireland

-

-

-

-

-

-

-

-

Netherlands

-

-

-

-

21

21

2,990

2,576

United States

-

-

-

-

-

-

-

-

Total Proved Developed Non-Producing

-

-

2,536

2,389

1,670

1,304

14,312

12,679

Light Crude Oil & Medium Crude Oil

Heavy Oil

Tight Oil

Conventional Natural Gas

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(MMcf)

(MMcf)

Proved Undeveloped (3) (8)

Australia

1,000

1,000

-

-

-

-

-

-

Canada

8,677

7,595

-

-

-

-

79,475

71,420

France

3,749

3,506

-

-

-

-

70

70

Germany

243

237

-

-

-

-

2,361

1,918

Ireland

-

-

-

-

-

-

3,714

3,714

Netherlands

-

-

-

-

-

-

3,041

3,041

United States

2,470

2,019

-

-

-

-

2,273

1,858

Total Proved Undeveloped

16,139

14,357

-

-

-

-

90,934

82,021

Shale Gas

Coal Bed Methane

Natural Gas Liquids

BOE

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross

Net

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

Proved Undeveloped

Australia

-

-

-

-

-

-

1,000

1,000

Canada

-

-

3,043

2,812

7,230

5,541

29,660

25,508

France

-

-

-

-

-

-

3,761

3,518

Germany

-

-

-

-

-

-

637

557

Ireland

-

-

-

-

-

-

619

619

Netherlands

-

-

-

-

1

1

508

508

United States

-

-

-

-

315

258

3,164

2,587

Total Proved Undeveloped

-

-

3,043

2,812

7,546

5,800

39,349

34,297

Light Crude Oil & Medium

Crude Oil

Heavy Oil

Tight Oil

Conventional Natural Gas

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(MMcf)

(MMcf)

Proved (3)

Australia

12,418

12,418

-

-

-

-

-

-

Canada

21,962

19,460

-

-

12

8

217,098

195,467

France

42,044

38,650

-

-

-

-

5,482

5,094

Germany

5,288

5,173

-

-

-

-

41,480

36,817

Ireland

-

-

-

-

-

-

99,575

99,575

Netherlands

-

-

-

-

-

-

62,350

48,228

United States

3,169

2,570

-

-

-

-

2,969

2,410

Total Proved

84,881

78,271

-

-

12

8

428,954

387,591

Shale Gas

Coal Bed Methane

Natural Gas Liquids

BOE

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross

Net

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

Proved

Australia

-

-

-

-

-

-

12,418

12,418

Canada

1,371

1,291

8,061

7,476

17,363

13,219

77,092

66,725

France

-

-

-

-

-

-

42,958

39,499

Germany

-

-

-

-

-

-

12,202

11,310

Ireland

-

-

-

-

-

-

16,596

16,596

Netherlands

-

-

-

-

81

81

10,473

8,120

United States

-

-

-

-

412

334

4,076

3,306

Total Proved

1,371

1,291

8,061

7,476

17,856

13,634

175,815

157,974

Light Crude Oil & Medium

Crude Oil

Heavy Oil

Tight Oil

Conventional Natural Gas

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(MMcf)

(MMcf)

Probable (4)

Australia

4,650

4,650

-

-

-

-

-

-

Canada

14,103

12,146

-

-

2

1

151,707

135,215

France

21,933

20,261

-

-

-

-

892

884

Germany

2,279

2,238

-

-

-

-

54,284

47,482

Ireland

-

-

-

-

-

-

50,787

50,787

Netherlands

-

-

-

-

-

-

43,184

33,118

United States

5,727

4,716

-

-

-

-

5,481

4,512

Total Probable

48,692

44,011

-

-

2

1

306,335

271,998

Shale Gas

Coal Bed Methane

Natural Gas Liquids

BOE

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross

Net

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

Probable

Australia

-

-

-

-

-

-

4,650

4,650

Canada

284

267

4,677

4,395

12,907

9,730

53,123

45,190

France

-

-

-

-

-

-

22,082

20,408

Germany

-

-

-

-

-

-

11,326

10,152

Ireland

-

-

-

-

-

-

8,465

8,465

Netherlands

-

-

-

-

63

56

7,260

5,576

United States

-

-

-

-

760

625

7,401

6,093

Total Probable

284

267

4,677

4,395

13,730

10,411

114,307

100,534

Light Crude Oil & Medium Crude Oil

Heavy Oil

Tight Oil

Conventional Natural Gas

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(MMcf)

(MMcf)

Proved Plus Probable (3) (4)

Australia

17,068

17,068

-

-

-

-

-

-

Canada

36,065

31,606

-

-

14

9

368,805

330,682

France

63,977

58,911

-

-

-

-

6,374

5,978

Germany

7,567

7,411

-

-

-

-

95,764

84,299

Ireland

-

-

-

-

-

-

150,362

150,362

Netherlands

-

-

-

-

-

-

105,534

81,346

United States

8,896

7,286

-

-

-

-

8,450

6,922

Total Proved Plus Probable

133,573

122,282

-

-

14

9

735,289

659,589

Shale Gas

Coal Bed Methane

Natural Gas Liquids

BOE

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross (2)

Net (2)

Gross

Net

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

Proved Plus Probable (3) (4)

Australia

-

-

-

-

-

-

17,068

17,068

Canada

1,655

1,558

12,738

11,871

30,270

22,949

130,215

111,915

France

-

-

-

-

-

-

65,040

59,907

Germany

-

-

-

-

-

-

23,528

21,462

Ireland

-

-

-

-

-

-

25,061

25,061

Netherlands

-

-

-

-

144

137

17,733

13,696

United States

-

-

-

-

1,172

959

11,477

9,399

Total Proved Plus Probable

1,655

1,558

12,738

11,871

31,586

24,045

290,122

258,508

Notes:

(1)

The pricing assumptions used in the GLJ Report with respect to net present value of future net revenue (forecast) as well as the inflation rates used for operating and capital costs are set forth below. See "Forecast Prices used in Estimates". The NGL price is an aggregate of the individual natural gas liquids prices used in the Total Proved plus Probable evaluation. GLJ is an independent qualified reserves evaluator appointed pursuant to NI 51-101.

(2)

"Gross Reserves" are Vermilion's working interest (operating or non-operating) share before deduction of royalties and without including any royalty interests of Vermilion. "Net Reserves" are Vermilion's working interest (operating or non-operating) share after deduction of royalty obligations, plus Vermilion's royalty interests in reserves.

(3)

"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.

(4)

"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.

(5)

"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.

(6)

"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.

(7)

"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.

(8)

"Undeveloped" reserves are those reserves 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.

Table 5: Net Present Values of Future Net Revenue - Based on Forecast Prices and Costs (1)

Before Deducting Future Income Taxes Discounted At

After Deducting Future Income Taxes Discounted At

(M$)

0%

5%

10%

15%

20%

0%

5%

10%

15%

20%

Proved Developed Producing (2) (4) (5)

Australia

134,236

217,117

240,607

240,546

231,618

164,830

197,187

199,187

190,432

178,594

Canada

963,690

777,268

645,191

553,740

487,804

963,690

777,268

645,191

553,740

487,804

France

2,009,158

1,404,527

1,073,623

871,502

736,836

1,664,358

1,169,631

894,523

725,047

611,642

Germany

193,385

187,330

161,141

138,822

121,707

193,385

187,330

161,141

138,822

121,707

Ireland

471,720

441,671

396,917

356,653

323,302

471,720

441,671

396,917

356,653

323,302

Netherlands

76,272

86,832

91,069

92,068

91,365

65,732

76,545

81,019

82,239

81,743

United States

29,716

23,345

19,334

16,637

14,710

29,716

23,345

19,334

16,637

14,710

Total Proved Developed Producing

3,878,177

3,138,090

2,627,882

2,269,968

2,007,342

3,553,431

2,872,977

2,397,312

2,063,570

1,819,502

Proved Developed Non-Producing (2) (4) (6)

Australia

31,411

35,177

32,247

28,181

24,473

31,411

35,177

32,247

28,181

24,473

Canada

147,607

108,964

87,413

73,769

64,329

147,607

108,964

87,413

73,769

64,329

France

87,674

71,387

60,449

52,665

46,857

60,567

49,131

41,376

35,850

31,732

Germany

41,121

29,470

21,864

16,769

13,244

41,121

29,470

21,864

16,769

13,244

Ireland

-

-

-

-

-

-

-

-

-

-

Netherlands

46,907

45,115

42,066

38,740

35,545

33,688

32,489

29,973

27,127

24,367

United States

-

-

-

-

-

-

-

-

-

-

Total Proved Developed Non-Producing

354,720

290,113

244,039

210,124

184,448

314,394

255,231

212,873

181,696

158,145

Proved Undeveloped (2) (7)

Australia

34,323

24,134

16,832

11,574

7,761

12,618

2,648

(1,772)

(3,929)

(5,057)

Canada

569,308

368,599

249,906

175,120

125,532

416,577

282,567

199,226

144,148

106,013

France

187,253

137,261

104,175

81,348

64,957

129,800

91,741

66,604

49,467

37,335

Germany

18,403

11,756

7,584

4,902

3,130

18,403

11,756

7,584

4,902

3,130

Ireland

12,873

9,337

6,763

4,894

3,536

12,873

9,337

6,763

4,894

3,536

Netherlands

10,896

9,095

7,611

6,411

5,443

8,160

6,584

5,294

4,263

3,443

United States

72,284

38,191

20,027

9,645

3,348

72,284

38,191

20,027

9,645

3,348

Total Proved Undeveloped

905,340

598,373

412,898

293,894

213,707

670,715

442,824

303,726

213,390

151,748

Proved (2)

Australia

199,970

276,428

289,686

280,301

263,852

208,859

235,012

229,662

214,684

198,010

Canada

1,680,605

1,254,831

982,510

802,629

677,665

1,527,874

1,168,799

931,830

771,657

658,146

France

2,284,085

1,613,175

1,238,247

1,005,515

848,650

1,854,725

1,310,503

1,002,503

810,364

680,709

Germany

252,909

228,556

190,589

160,493

138,081

252,909

228,556

190,589

160,493

138,081

Ireland

484,593

451,008

403,680

361,547

326,838

484,593

451,008

403,680

361,547

326,838

Netherlands

134,075

141,042

140,746

137,219

132,353

107,580

115,618

116,286

113,629

109,553

United States

102,000

61,536

39,361

26,282

18,058

102,000

61,536

39,361

26,282

18,058

Total Proved

5,138,237

4,026,576

3,284,819

2,773,986

2,405,497

4,538,540

3,571,032

2,913,911

2,458,656

2,129,395

Probable (3)

Australia

198,227

163,180

128,734

101,649

81,484

107,201

87,874

68,562

53,406

42,201

Canada

1,372,807

814,946

539,761

384,694

288,798

1,009,708

591,846

389,432

277,104

208,604

France

1,378,689

734,502

464,026

323,290

239,221

974,931

502,379

305,000

203,471

143,693

Germany

336,322

208,119

130,651

86,473

59,902

248,590

162,713

105,566

71,859

51,003

Ireland

354,566

235,805

167,862

126,297

99,303

354,566

235,805

167,862

126,297

99,303

Netherlands

162,029

137,048

115,870

98,750

85,096

111,908

92,487

75,843

62,469

51,946

United States

270,229

147,720

90,240

59,467

41,247

175,706

98,838

61,958

41,765

29,522

Total Probable

4,072,869

2,441,320

1,637,144

1,180,620

895,051

2,982,610

1,771,942

1,174,223

836,371

626,272

Proved Plus Probable (2) (3)

Australia

398,197

439,608

418,420

381,950

345,336

316,060

322,886

298,224

268,090

240,211

Canada

3,053,412

2,069,777

1,522,271

1,187,323

966,463

2,537,582

1,760,645

1,321,262

1,048,761

866,750

France

3,662,774

2,347,677

1,702,273

1,328,805

1,087,871

2,829,656

1,812,882

1,307,503

1,013,835

824,402

Germany

589,231

436,675

321,240

246,966

197,983

501,499

391,269

296,155

232,352

189,084

Ireland

839,159

686,813

571,542

487,844

426,141

839,159

686,813

571,542

487,844

426,141

Netherlands

296,104

278,090

256,616

235,969

217,449

219,488

208,105

192,129

176,098

161,499

United States

372,229

209,256

129,601

85,749

59,305

277,706

160,374

101,319

68,047

47,580

Total Proved Plus Probable

9,211,106

6,467,896

4,921,963

3,954,606

3,300,548

7,521,150

5,342,974

4,088,134

3,295,027

2,755,667

Notes:

(1)

The pricing assumptions used in the GLJ Report with respect to net present value of future net revenue (forecast) as well as the inflation rates used for operating and capital costs are set forth below. See "Forecast Prices used in Estimates". The NGL price is an aggregate of the individual natural gas liquids prices used in the Total Proved plus Probable evaluation. GLJ is an independent qualified reserves evaluator appointed pursuant to NI 51-101.

(2)

"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.

(3)

"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.

(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 reserves 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.

Table 6: Total Future Net Revenue (Undiscounted) Based on Forecast Prices and Costs (1)

Abandonment

Future Net

Future Net

Capital

and

Revenue

Revenue

Operating

Development

Reclamation

Before

Future

After

(M$)

Revenue

Royalties

Costs

Costs

Costs

Income Taxes

Income Taxes

Income Taxes

Proved (2)

Australia

1,130,774

-

585,013

98,280

247,512

199,969

(8,890)

208,859

Canada

3,767,788

508,170

1,060,685

421,548

96,780

1,680,605

152,731

1,527,874

France

3,892,917

309,696

1,017,941

123,472

157,722

2,284,086

429,361

1,854,725

Germany

812,577

43,400

383,854

12,267

120,147

252,909

-

252,909

Ireland

755,793

-

174,058

35,412

61,729

484,594

-

484,594

Netherlands

523,311

103,758

197,686

22,639

65,154

134,074

26,495

107,579

United States

297,606

83,116

48,860

60,639

2,991

102,000

-

102,000

Total Proved

11,180,766

1,048,140

3,468,097

774,257

752,035

5,138,237

599,697

4,538,540

Proved Plus Probable (2) (3)

Australia

1,611,584

-

777,207

175,660

260,522

398,197

82,137

316,060

Canada

6,601,327

949,111

1,699,340

774,361

125,102

3,053,413

515,831

2,537,582

France

6,232,560

486,688

1,560,331

317,562

205,205

3,662,774

833,118

2,829,656

Germany

1,534,267

102,937

592,967

88,681

160,451

589,231

87,732

501,499

Ireland

1,208,966

-

272,665

35,412

61,729

839,159

-

839,159

Netherlands

887,526

181,892

286,933

45,647

76,950

296,104

76,616

219,488

United States

888,444

241,131

130,837

137,814

6,434

372,229

94,523

277,706

Total Proved Plus Probable

18,964,674

1,961,759

5,320,280

1,575,137

896,393

9,211,107

1,689,957

7,521,150

Notes:

(1)

The pricing assumptions used in the GLJ Report with respect to net present value of future net revenue (forecast) as well as the inflation rates used for operating and capital costs are set forth below. See "Forecast Prices used in Estimates". The NGL price is an aggregate of the individual natural gas liquids prices used in the Total Proved plus Probable evaluation. GLJ is an independent qualified reserves evaluator appointed pursuant to NI 51-101.

(2)

"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.

(3)

"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.

Table 7: Future Net Revenue by Production Group Based on Forecast Prices and Costs (1)

Future Net Revenue

Before Income Taxes (2)

(Discounted at 10% Per Year)

Unit Value

Proved Developed Producing

(M$)

($/boe)

Light crude oil & medium crude oil (3)

1,869,323

28.43

Heavy Oil (3)

-

-

Conventional Natural gas (4)

755,799

16.95

Shale Gas

1,928

6.93

Coal Bed Methane

832

2.19

Total Proved Developed Producing

2,627,882

23.68

Proved Developed Non-Producing

Light crude oil & medium crude oil (3)

119,652

32.00

Heavy Oil (3)

-

-

Conventional Natural gas (4)

123,922

14.51

Shale Gas

-

-

Coal Bed Methane

465

1.17

Total Proved Developed Non-Producing

244,039

19.25

Proved Undeveloped

Light crude oil & medium crude oil (3)

279,927

14.84

Heavy Oil (3)

-

-

Conventional Natural gas (4)

132,343

8.84

Shale Gas

-

-

Coal Bed Methane

628

1.34

Total Proved Undeveloped

412,898

12.04

Proved

Light crude oil & medium crude oil (3)

2,268,902

25.72

Heavy Oil (3)

-

-

Conventional Natural gas (4)

1,012,064

14.82

Shale Gas

1,928

6.97

Coal Bed Methane

1,925

1.53

Total Proved

3,284,819

20.79

Probable

Light crude oil & medium crude oil (3)

1,044,229

20.31

Heavy Oil (3)

-

-

Conventional Natural gas (4)

590,638

12.22

Shale Gas

357

6.26

Coal Bed Methane

1,920

2.62

Total Probable

1,637,144

16.28

Proved Plus Probable

Light crude oil & medium crude oil (3)

3,313,131

23.76

Heavy Oil (3)

-

-

Conventional Natural gas (4)

1,602,702

13.70

Shale Gas

2,285

6.93

Coal Bed Methane

3,845

1.91

Total Proved Plus Probable

4,921,963

19.04

Notes:

(1)

The pricing assumptions used in the GLJ Report with respect to net present value of future net revenue (forecast) as well as the inflation rates used for operating and capital costs are set forth below. See "Forecast Prices used in Estimates". The NGL price is an aggregate of the individual natural gas liquids prices used in the Total Proved plus Probable evaluation. GLJ is an independent qualified reserves evaluator appointed pursuant to NI 51-101.

(2)

Other Company revenue and costs not related to a specific product type have been allocated proportionately to the specified product types. Unit values are based on Company Net Reserves. Net present value of reserves categories are an approximation based on major products.

(3)

Including solution gas and other by-products.

(4)

Including by-products but excluding solution gas.

Reconciliations of Changes in Reserves

The following tables set forth a reconciliation of the changes in Vermilion's gross light and medium crude oil, heavy oil and associated and non-associated gas (combined) reserves as at December 31, 2016 compared to such reserves as at December 31, 2015.

Table 8: Reconciliation of Company Gross Reserves by Principal Product Type - Based on Forecast Prices and Costs (3)

Light Crude Oil &

AUSTRALIA

Total Oil (4)

Medium Crude Oil

Heavy Oil

Tight Oil

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

At December 31, 2015

13,765

3,700

17,465

13,765

3,700

17,465

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

700

1,300

2,000

700

1,300

2,000

-

-

-

-

-

-

Technical Revisions

260

(350)

(90)

260

(350)

(90)

-

-

-

-

-

-

Acquisitions

-

-

-

-

-

-

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

-

-

-

-

-

-

-

-

-

-

-

-

Production

(2,307)

-

(2,307)

(2,307)

-

(2,307)

-

-

-

-

-

-

At December 31, 2016

12,418

4,650

17,068

12,418

4,650

17,068

-

-

-

-

-

-

Total Gas (4)

Conventional Natural Gas

Coal Bed Methane (5)

Shale Gas (5)

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

At December 31, 2015

-

-

-

-

-

-

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

-

-

-

-

-

-

-

-

-

-

-

-

Technical Revisions

-

-

-

-

-

-

-

-

-

-

-

-

Acquisitions

-

-

-

-

-

-

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

-

-

-

-

-

-

-

-

-

-

-

-

Production

-

-

-

-

-

-

-

-

-

-

-

-

At December 31, 2016

-

-

-

-

-

-

-

-

-

-

-

-

Natural Gas Liquids

BOE

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(Mboe)

At December 31, 2015

-

-

-

13,765

3,700

17,465

Discoveries

-

-

-

-

-

-

Extensions & Improved Recovery

-

-

-

700

1,300

2,000

Technical Revisions

-

-

-

260

(350)

(90)

Acquisitions

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

Economic Factors

-

-

-

-

-

-

Production

-

-

-

(2,307)

-

(2,307)

At December 31, 2016

-

-

-

12,418

4,650

17,068

Light Crude Oil &

CANADA

Total Oil (4)

Medium Crude Oil

Heavy Oil

Tight Oil

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

At December 31, 2015

22,990

14,792

37,782

22,971

14,786

37,757

9

3

12

10

3

13

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

620

281

901

620

281

901

-

-

-

-

-

-

Technical Revisions

611

(1,284)

(673)

616

(1,280)

(664)

(9)

(3)

(12)

4

(1)

3

Acquisitions

206

317

523

206

317

523

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

(15)

(1)

(16)

(15)

(1)

(16)

-

-

-

-

-

-

Production

(2,438)

-

(2,438)

(2,436)

-

(2,436)

-

-

-

(2)

-

(2)

At December 31, 2016

21,974

14,105

36,079

21,962

14,103

36,065

-

-

-

12

2

14

Total Gas (4)

Conventional Natural Gas

Coal Bed Methane (5)

Shale Gas (5)

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

At December 31, 2015

200,263

138,068

338,331

190,111

132,676

322,787

8,210

4,917

13,127

1,942

475

2,417

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

18,401

20,608

39,009

18,401

20,608

39,009

-

-

-

-

-

-

Technical Revisions

27,342

(8,022)

19,320

26,058

(7,696)

18,362

1,394

(135)

1,259

(110)

(191)

(301)

Acquisitions

13,078

6,758

19,836

13,006

6,671

19,677

72

87

159

-

-

-

Dispositions

(353)

(132)

(485)

(353)

(132)

(485)

-

-

-

-

-

-

Economic Factors

(1,351)

(612)

(1,963)

(649)

(420)

(1,069)

(702)

(192)

(894)

-

-

-

Production

(30,850)

-

(30,850)

(29,476)

-

(29,476)

(913)

-

(913)

(461)

-

(461)

At December 31, 2016

226,530

156,668

383,198

217,098

151,707

368,805

8,061

4,677

12,738

1,371

284

1,655

Natural Gas Liquids

BOE

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(Mboe)

At December 31, 2015

14,795

12,751

27,546

71,162

50,554

121,717

Discoveries

-

-

-

-

-

-

Extensions & Improved Recovery

1,412

825

2,237

5,099

4,541

9,640

Technical Revisions

2,004

(1,088)

916

7,172

(3,709)

3,463

Acquisitions

1,045

471

1,516

3,431

1,914

5,345

Dispositions

(8)

(3)

(11)

(67)

(25)

(92)

Economic Factors

(31)

(49)

(80)

(271)

(152)

(423)

Production

(1,854)

-

(1,854)

(9,434)

-

(9,434)

At December 31, 2016

17,363

12,907

30,270

77,092

53,123

130,215

Light Crude Oil &

FRANCE

Total Oil (4)

Medium Crude Oil

Heavy Oil

Tight Oil

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

At December 31, 2015

40,721

21,325

62,046

40,721

21,325

62,046

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

2,279

314

2,593

2,279

314

2,593

-

-

-

-

-

-

Technical Revisions

3,445

319

3,764

3,445

319

3,764

-

-

-

-

-

-

Acquisitions

-

-

-

-

-

-

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

(47)

(25)

(72)

(47)

(25)

(72)

-

-

-

-

-

-

Production

(4,354)

-

(4,354)

(4,354)

-

(4,354)

-

-

-

-

-

-

At December 31, 2016

42,044

21,933

63,977

42,044

21,933

63,977

-

-

-

-

-

-

Total Gas (4)

Conventional Natural Gas

Coal Bed Methane (5)

Shale Gas (5)

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

At December 31, 2015

7,835

1,559

9,394

7,835

1,559

9,394

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

-

-

-

-

-

-

-

-

-

-

-

-

Technical Revisions

(2,170)

(654)

(2,824)

(2,170)

(654)

(2,824)

-

-

-

-

-

-

Acquisitions

-

-

-

-

-

-

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

(20)

(13)

(33)

(20)

(13)

(33)

-

-

-

-

-

-

Production

(163)

-

(163)

(163)

-

(163)

-

-

-

-

-

-

At December 31, 2016

5,482

892

6,374

5,482

892

6,374

-

-

-

-

-

-

Natural Gas Liquids

BOE

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(Mboe)

At December 31, 2015

-

-

-

42,027

21,585

63,612

Discoveries

-

-

-

-

-

-

Extensions & Improved Recovery

-

-

-

2,279

314

2,593

Technical Revisions

-

-

-

3,083

210

3,293

Acquisitions

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

Economic Factors

-

-

-

(50)

(27)

(77)

Production

-

-

-

(4,381)

-

(4,381)

At December 31, 2016

-

-

-

42,958

22,082

65,040

Light Crude Oil &

GERMANY

Total Oil (4)

Medium Crude Oil

Heavy Oil

Tight Oil

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

At December 31, 2015

-

-

-

-

-

-

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

244

755

999

244

755

999

-

-

-

-

-

-

Technical Revisions

-

-

-

-

-

-

-

-

-

-

-

-

Acquisitions

5,044

1,524

6,568

5,044

1,524

6,568

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

-

-

-

-

-

-

-

-

-

-

-

-

Production

-

-

-

-

-

-

-

-

-

-

-

-

At December 31, 2016

5,288

2,279

7,567

5,288

2,279

7,567

-

-

-

-

-

-

Total Gas (4)

Conventional Natural Gas

Coal Bed Methane (5)

Shale Gas (5)

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

At December 31, 2015

31,500

17,999

49,499

31,500

17,999

49,499

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

-

33,249

33,249

-

33,249

33,249

-

-

-

-

-

-

Technical Revisions

4,250

(898)

3,352

4,250

(898)

3,352

-

-

-

-

-

-

Acquisitions

11,182

3,934

15,116

11,182

3,934

15,116

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

-

-

-

-

-

-

-

-

-

-

-

-

Production

(5,452)

-

(5,452)

(5,452)

-

(5,452)

-

-

-

-

-

-

At December 31, 2016

41,480

54,284

95,764

41,480

54,284

95,764

-

-

-

-

-

-

Natural Gas Liquids

BOE

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(Mboe)

At December 31, 2015

-

-

-

5,250

3,000

8,250

Discoveries

-

-

-

-

-

-

Extensions & Improved Recovery

-

-

-

244

6,297

6,541

Technical Revisions

-

-

-

708

(150)

559

Acquisitions

-

-

-

6,909

2,179

9,087

Dispositions

-

-

-

-

-

-

Economic Factors

-

-

-

-

-

-

Production

-

-

-

(909)

-

(909)

At December 31, 2016

-

-

-

12,202

11,326

23,528

Light Crude Oil &

IRELAND

Total Oil (4)

Medium Crude Oil

Heavy Oil

Tight Oil

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

At December 31, 2015

-

-

-

-

-

-

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

-

-

-

-

-

-

-

-

-

-

-

-

Technical Revisions

-

-

-

-

-

-

-

-

-

-

-

-

Acquisitions

-

-

-

-

-

-

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

-

-

-

-

-

-

-

-

-

-

-

-

Production

-

-

-

-

-

-

-

-

-

-

-

-

At December 31, 2016

-

-

-

-

-

-

-

-

-

-

-

-

Total Gas (4)

Conventional Natural Gas

Coal Bed Methane (5)

Shale Gas (5)

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

At December 31, 2015

105,821

47,405

153,226

105,821

47,405

153,226

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

3,714

2,718

6,432

3,714

2,718

6,432

-

-

-

-

-

-

Technical Revisions

8,610

721

9,331

8,610

721

9,331

-

-

-

-

-

-

Acquisitions

-

-

-

-

-

-

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

57

(57)

-

57

(57)

-

-

-

-

-

-

-

Production

(18,627)

-

(18,627)

(18,627)

-

(18,627)

-

-

-

-

-

-

At December 31, 2016

99,575

50,787

150,362

99,575

50,787

150,362

-

-

-

-

-

-

Natural Gas Liquids

BOE

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(Mboe)

At December 31, 2015

-

-

-

17,637

7,901

25,538

Discoveries

-

-

-

-

-

-

Extensions & Improved Recovery

-

-

-

619

453

1,072

Technical Revisions

-

-

-

1,435

121

1,556

Acquisitions

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

Economic Factors

-

-

-

10

(10)

-

Production

-

-

-

(3,105)

-

(3,105)

At December 31, 2016

-

-

-

16,596

8,465

25,061

Light Crude Oil &

NETHERLANDS

Total Oil (4)

Medium Crude Oil

Heavy Oil

Tight Oil

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

At December 31, 2015

-

-

-

-

-

-

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

-

-

-

-

-

-

-

-

-

-

-

-

Technical Revisions

-

-

-

-

-

-

-

-

-

-

-

-

Acquisitions

-

-

-

-

-

-

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

-

-

-

-

-

-

-

-

-

-

-

-

Production

-

-

-

-

-

-

-

-

-

-

-

-

At December 31, 2016

-

-

-

-

-

-

-

-

-

-

-

-

Total Gas (4)

Conventional Natural Gas

Coal Bed Methane (5)

Shale Gas (5)

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

At December 31, 2015

48,199

48,688

96,887

48,199

48,688

96,887

-

-

-

-

-

-

Discoveries

233

145

378

233

145

378

-

-

-

-

-

-

Extensions & Improved Recovery

8,104

8,782

16,886

8,104

8,782

16,886

-

-

-

-

-

-

Technical Revisions

20,790

(15,818)

4,972

20,790

(15,818)

4,972

-

-

-

-

-

-

Acquisitions

2,654

1,446

4,100

2,654

1,446

4,100

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

(128)

(59)

(187)

(128)

(59)

(187)

-

-

-

-

-

-

Production

(17,502)

-

(17,502)

(17,502)

-

(17,502)

-

-

-

-

-

-

At December 31, 2016

62,350

43,184

105,534

62,350

43,184

105,534

-

-

-

-

-

-

Natural Gas Liquids

BOE

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(Mboe)

At December 31, 2015

88

83

171

8,122

8,198

16,320

Discoveries

1

1

2

40

25

65

Extensions & Improved Recovery

3

7

10

1,353

1,470

2,823

Technical Revisions

17

(31)

(14)

3,482

(2,667)

815

Acquisitions

5

3

8

447

244

691

Dispositions

-

-

-

-

-

-

Economic Factors

(1)

(0)

(1)

(22)

(10)

(32)

Production

(32)

-

(32)

(2,949)

-

(2,949)

At December 31, 2016

81

63

144

10,473

7,260

17,733

Light Crude Oil &

UNITED STATES

Total Oil (4)

Medium Crude Oil

Heavy Oil

Tight Oil

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

At December 31, 2015

2,034

3,818

5,852

2,034

3,818

5,852

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

1,105

1,644

2,749

1,105

1,644

2,749

-

-

-

-

-

-

Technical Revisions

178

271

449

178

271

449

-

-

-

-

-

-

Acquisitions

-

-

-

-

-

-

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

(4)

(6)

(10)

(4)

(6)

(10)

-

-

-

-

-

-

Production

(144)

-

(144)

(144)

-

(144)

-

-

-

-

-

-

At December 31, 2016

3,169

5,727

8,896

3,169

5,727

8,896

-

-

-

-

-

-

Total Gas (4)

Conventional Natural Gas

Coal Bed Methane (5)

Shale Gas (5)

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

At December 31, 2015

2,170

4,378

6,548

2,170

4,378

6,548

-

-

-

-

-

-

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

1,011

1,578

2,589

1,011

1,578

2,589

-

-

-

-

-

-

Technical Revisions

(129)

(460)

(589)

(129)

(460)

(589)

-

-

-

-

-

-

Acquisitions

-

-

-

-

-

-

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

(6)

(15)

(21)

(6)

(15)

(21)

-

-

-

-

-

-

Production

(77)

-

(77)

(77)

-

(77)

-

-

-

-

-

-

At December 31, 2016

2,969

5,481

8,450

2,969

5,481

8,450

-

-

-

-

-

-

Natural Gas Liquids

BOE

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(Mboe)

At December 31, 2015

346

698

1,044

2,742

5,246

7,988

Discoveries

-

-

-

-

-

-

Extensions & Improved Recovery

141

219

360

1,415

2,127

3,541

Technical Revisions

(62)

(155)

(217)

94

39

134

Acquisitions

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

Economic Factors

(2)

(2)

(4)

(7)

(11)

(18)

Production

(11)

-

(11)

(168)

-

(168)

At December 31, 2016

412

760

1,172

4,076

7,401

11,477

Light Crude Oil &

TOTAL COMPANY

Total Oil (4)

Medium Crude Oil

Heavy Oil

Tight Oil

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

(Mbbl)

At December 31, 2015

79,510

43,635

123,145

79,491

43,629

123,120

9

3

12

10

3

13

Discoveries

-

-

-

-

-

-

-

-

-

-

-

-

Extensions & Improved Recovery

4,948

4,294

9,242

4,948

4,294

9,242

-

-

-

-

-

-

Technical Revisions

4,492

(1,044)

3,450

4,499

(1,040)

3,459

(9)

(3)

(12)

4

(1)

3

Acquisitions

5,250

1,841

7,091

5,250

1,841

7,091

-

-

-

-

-

-

Dispositions

-

-

-

-

-

-

-

-

-

-

-

-

Economic Factors

(66)

(32)

(98)

(66)

(32)

(98)

-

-

-

-

-

-

Production

(9,243)

-

(9,243)

(9,241)

-

(9,241)

-

-

-

(2)

-

(2)

At December 31, 2016

84,891

48,694

133,587

84,881

48,692

133,573

-

-

-

12

2

14

Total Gas (4)

Conventional Natural Gas

Coal Bed Methane (5)

Shale Gas (5)

Proved +

Proved +

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

At December 31, 2015

395,788

258,097

653,885

385,637

252,705

638,342

8,210

4,917

13,127

1,942

475

2,417

Discoveries

233

145

378

233

145

378

-

-

-

-

-

-

Extensions & Improved Recovery

31,230

66,935

98,165

31,230

66,935

98,165

-

-

-

-

-

-

Technical Revisions

58,693

(25,131)

33,562

57,408

(24,805)

32,603

1,394

(135)

1,259

(110)

(191)

(301)

Acquisitions

26,914

12,138

39,052

26,842

12,051

38,893

72

87

159

-

-

-

Dispositions

(353)

(132)

(485)

(353)

(132)

(485)

-

-

-

-

-

-

Economic Factors

(1,448)

(756)

(2,204)

(746)

(564)

(1,310)

(702)

(192)

(894)

-

-

-

Production

(72,671)

-

(72,671)

(71,297)

-

(71,297)

(913)

-

(913)

(461)

-

(461)

At December 31, 2016

438,386

311,296

749,682

428,954

306,335

735,289

8,061

4,677

12,738

1,371

284

1,655

Natural Gas Liquids

BOE

Proved +

Proved +

Proved Probable P+P (1) (2)

Proved

Probable

Probable

Proved

Probable

Probable

Factors

(Mbbl)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(Mboe)

At December 31, 2015

15,229

13,532

28,761

160,706

100,184

260,889

Discoveries

1

1

2

40

25

65

Extensions & Improved Recovery

1,556

1,051

2,607

11,709

16,502

28,210

Technical Revisions

1,959

(1,274)

685

16,233

(6,506)

9,730

Acquisitions

1,050

474

1,524

10,787

4,337

15,123

Dispositions

(8)

(3)

(11)

(67)

(25)

(92)

Economic Factors

(34)

(51)

(85)

(340)

(210)

(550)

Production

(1,897)

-

(1,897)

(23,253)

-

(23,253)

At December 31, 2016

17,856

13,730

31,586

175,815

114,307

290,122

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)

The pricing assumptions used in the GLJ Report with respect to net present value of future net revenue (forecast) as well as the inflation rates used for operating and capital costs are set forth above. See "Forecast Prices used in Estimates". The NGL price is an aggregate of the individual natural gas liquids prices used in the Total Proved plus Probable evaluation. GLJ is an independent qualified reserves evaluator appointed pursuant to NI 51-101.

(4)

For reporting purposes, "Total Oil" is the sum of Light Crude oil and Medium Crude Oil, Heavy Oil and Tight Oil. For reporting purposes, "Total Gas" is the sum of Conventional Natural Gas, Coal Bed Methane and Shale Gas.

(5)

"Coal Bed Methane" and "Shale Gas" were considered "Unconventional Natural Gas" in previous years. NI 51-101 no longer differentiates between conventional and unconventional activities.

The table below sets out the future development costs deducted in the estimation of future net revenue attributable to total proved reserves and total proved plus probable reserves (using forecast prices and costs).

Table 9: Future Development Costs(1)

Total Proved

Total Proved Plus Probable

(M$)

Estimated Using Forecast Prices and Costs

Estimated Using Forecast Prices and Costs

Australia

2017

9,420

9,420

2018

6,701

6,701

2019

51,052

51,052

2020

2,993

2,993

2021

3,052

57,174

Remainder

25,062

48,320

Total for all years undiscounted

98,280

175,660

Canada

2017

77,141

101,695

2018

90,442

126,482

2019

81,623

128,701

2020

95,424

189,622

2021

59,376

175,978

Remainder

17,542

51,883

Total for all years undiscounted

421,548

774,361

France

2017

39,113

60,593

2018

29,528

49,613

2019

23,548

107,737

2020

6,753

40,020

2021

14,167

23,931

Remainder

10,363

35,668

Total for all years undiscounted

123,472

317,562

Germany

2017

2,183

3,562

2018

584

3,272

2019

8,499

30,655

2020

154

6,863

2021

153

41,162

Remainder

694

3,167

Total for all years undiscounted

12,267

88,681

Ireland

2017

1,311

1,311

2018

-

-

2019

1,706

1,706

2020

16,890

16,890

2021

-

-

Remainder

15,505

15,505

Total for all years undiscounted

35,412

35,412

Netherlands

2017

2,200

7,790

2018

13,525

15,009

2019

604

4,838

2020

385

4,278

2021

287

8,095

Remainder

5,638

5,637

Total for all years undiscounted

22,639

45,647

United States

2017

10,500

10,500

2018

18,426

36,468

2019

18,207

48,039

2020

13,506

42,806

2021

-

-

Remainder

-

1

Total for all years undiscounted

60,639

137,814

Total Company

2017

141,868

194,871

2018

159,206

237,545

2019

185,239

372,728

2020

136,105

303,472

2021

77,035

306,340

Remainder

74,804

160,181

Total for all years undiscounted

774,257

1,575,137

Note:

(1)

The pricing assumptions used in the GLJ Report with respect to net present value of future net revenue (forecast) as well as the inflation rates used for operating and capital costs are set forth above. See "Forecast Prices used in Estimates". The NGL price is an aggregate of the individual natural gas liquids prices used in the Total Proved plus Probable evaluation. GLJ is an independent qualified reserves evaluator appointed pursuant to NI 51-101.

Vermilion expects to source its capital expenditure requirements from internally generated cash flow and, as appropriate, from Vermilion's existing credit facility or equity or debt financing. It is anticipated that costs of funding the future development costs will not impact development of its properties or Vermilion's reserves or future net revenue.

CONTINGENT RESOURCES

Summary information regarding contingent resources and net present value of future net revenues from contingent resources are set forth below and are derived, in each case, from the GLJ Resources Assessment. The GLJ Resources Assessment was prepared in accordance with COGEH and NI-51-101 by GLJ, an independent qualified reserve evaluator. All contingent resources evaluated in the GLJ Resources Assessment were deemed economic at the effective date of December 31, 2016. Contingent resources are in addition to reserves estimated in the GLJ Report.

A range of contingent resources estimates (low, best and high) were prepared by GLJ. See notes 6 to 8 of the tables below for a description of low estimate, best estimate and high estimate.

The GLJ Resources Assessment estimated gross risked contingent resources with a project maturity subclass of "Development Pending" of 120.4 million boe (low estimate) to 309.4 million boe (high estimate), with a best estimate of 198.5 million boe. Contingent resources are in addition to reserves estimated in the GLJ Report.

The GLJ Resources Assessment estimated gross risked contingent resources with a project maturity subclass of "Development Unclarified" of 10.7 million boe (low estimate) to 28.7 million boe (high estimate), with a best estimate of 19.5 million boe.

An estimate of risked net present value of future net revenue of contingent resources is preliminary in nature and is provided to assist the reader in reaching an opinion on the merit and likelihood of the company proceeding with the required investment. It includes contingent resources that are considered too uncertain with respect to the chance of development to be classified as reserves. There is uncertainty that the risked net present value of future net revenue will be realized.

Table 10: Summary of Risked Oil and Gas Contingent Resources as at December 31, 2016 (1) (2) - Forecast Prices and Costs (3) (4)

Light Crude Oil &

Conventional

Coal Bed

Natural Gas

BOE

Unrisked

Resources

Medium Crude Oil

Natural Gas

Methane

Liquids

BOE

Project

Chance

Maturity

Gross

Net

Gross

Net

Gross

Net

Gross

Net

Gross

Net

of Dev.

Gross

Net

Sub-Class

(Mbbl)

(Mbbl)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(%) (9)

(Mboe)

(Mboe)

Contingent (1C) - Low Estimate

Development Pending(10)

Australia(11)

-

-

-

-

-

-

-

-

-

-

-

-

-

Canada(12)

13,145

9,681

250,957

226,293

1,455

1,382

19,917

15,769

75,131

63,396

81.9%

91,750

77,305

France(13)

14,152

13,241

969

969

-

-

-

-

14,314

13,403

86.8%

16,486

15,438

Germany(14)

-

-

17,317

15,138

-

-

-

-

2,886

2,523

78.3%

3,686

3,222

Ireland

-

-

-

-

-

-

-

-

-

-

-

-

-

Netherlands(15)

-

-

10,336

10,336

-

-

2

2

1,725

1,725

81.4%

2,119

2,119

USA(16)

20,581

17,072

18,952

15,720

-

-

2,627

2,179

26,367

21,871

90.0%

29,296

24,300

Total

47,878

39,994

298,531

268,456

1,455

1,382

22,546

17,950

120,423

102,918

84.0%

143,337

122,384

Contingent (2C) - Best Estimate

Development Pending(10)

Australia(11)

2,440

2,440

-

-

-

-

-

-

2,440

2,440

80.0%

3,050

3,050

Canada(12)

25,648

18,373

389,272

346,617

3,534

3,357

29,537

22,869

120,653

99,571

80.3%

150,178

123,661

France(13)

27,543

25,702

1,246

1,246

-

-

-

-

27,751

25,908

85.1%

32,628

30,453

Germany(14)

-

-

29,595

25,886

-

-

-

-

4,933

4,314

78.3%

6,300

5,510

Ireland

-

-

-

-

-

-

-

-

-

-

-

-

-

Netherlands(15)

-

-

28,521

28,521

-

-

6

6

4,760

4,760

81.3%

5,853

5,853

USA(16)

29,466

24,441

27,811

23,069

-

-

3,855

3,197

37,956

31,483

90.0%

42,173

34,981

Total

85,097

70,956

476,445

425,339

3,534

3,357

33,398

26,072

198,493

168,476

82.6%

240,182

203,508

Contingent (3C) - High Estimate

Development Pending(10)

Australia(11)

3,280

3,280

-

-

-

-

-

-

3,280

3,280

80.0%

4,100

4,100

Canada(12)

52,590

37,459

567,390

500,749

5,174

4,788

41,650

31,616

189,667

153,331

79.2%

239,562

193,233

France(13)

43,866

40,873

1,609

1,609

-

-

-

-

44,134

41,141

84.3%

52,336

48,774

Germany(14)

-

-

54,150

47,382

-

-

-

-

9,025

7,897

78.3%

11,526

10,086

Ireland

-

-

-

-

-

-

-

-

-

-

-

-

-

Netherlands(15)

-

-

50,159

50,159

-

-

13

13

8,373

8,373

80.5%

10,403

10,403

USA(16)

42,381

35,152

40,945

33,961

-

-

5,675

4,707

54,880

45,519

90.0%

60,977

50,577

Total

142,117

116,764

714,253

633,860

5,174

4,788

47,338

36,336

309,359

259,541

81.6%

378,904

317,173

Light Crude Oil &

Conventional

Coal Bed

Natural Gas

BOE

Unrisked

Resources

Medium Crude Oil

Natural Gas

Methane

Liquids

BOE

Project

Chance

Maturity

Gross

Net

Gross

Net

Gross

Net

Gross

Net

Gross

Net

of Dev.

Gross

Net

Sub-Class

(Mbbl)

(Mbbl)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(%) (9)

(Mboe)

(Mboe)

Contingent (1C) - Low Estimate

Development Unclarified(17)

Australia

-

-

-

-

-

-

-

-

-

-

-

-

-

Canada(18)

-

-

44,744

39,976

-

-

897

745

8,354

7,408

58.2%

14,361

12,743

France(19)

1,511

1,434

-

-

-

-

-

-

1,511

1,434

42.4%

3,560

3,376

Germany

-

-

-

-

-

-

-

-

-

-

-

-

-

Ireland

-

-

-

-

-

-

-

-

-

-

-

-

-

Netherlands

-

-

-

-

-

-

-

-

-

-

-

-

-

USA

-

-

-

-

-

-

-

-

-

-

-

-

-

Total

1,511

1,434

44,744

39,976

-

-

897

745

9,865

8,842

55.0%

17,921

16,119

Contingent (2C) - Best Estimate

Development Unclarified(17)

Australia

-

-

-

-

-

-

-

-

-

-

-

-

-

Canada(18)

-

-

75,428

66,726

-

-

1,640

1,339

14,211

12,460

57.2%

24,859

21,796

France(19)

2,539

2,410

-

-

-

-

-

-

2,539

2,410

44.6%

5,690

5,398

Germany

-

-

-

-

-

-

-

-

-

-

-

-

-

Ireland

-

-

-

-

-

-

-

-

-

-

-

-

-

Netherlands(20)

-

-

16,351

15,777

-

-

32

16

2,757

2,646

49.4%

5,580

5,301

USA

-

-

-

-

-

-

-

-

-

-

-

-

-

Total

2,539

2,410

91,779

82,503

-

-

1,672

1,355

19,507

17,516

54.0%

36,129

32,495

Contingent (3C) - High Estimate

Development Unclarified(17)

Australia

-

-

-

-

-

-

-

-

-

-

-

-

-

Canada(18)

-

-

103,491

89,867

-

-

2,178

1,727

19,427

16,705

57.6%

33,746

29,063

France(19)

3,825

3,632

-

-

-

-

-

-

3,825

3,632

46.4%

8,250

7,829

Germany

-

-

-

-

-

-

-

-

-

-

-

-

-

Ireland

-

-

-

-

-

-

-

-

-

-

-

-

-

Netherlands(20)

-

-

32,346

31,475

-

-

48

24

5,439

5,270

53.4%

10,184

9,761

USA

-

-

-

-

-

-

-

-

-

-

-

-

-

Total

3,825

3,632

135,837

121,342

-

-

2,226

1,751

28,691

25,607

55.0%

52,180

46,653

Table 11: Summary of Risked Net Present Value of Future Net Revenues as at December 31, 2016 - Forecast Prices and Costs (3)

Resources Project

Maturity Sub-Class

Before Income Taxes, Discounted at (5)

After Income Taxes, Discounted at (5)

(M$)

0%

5%

10%

15%

20%

0%

5%

10%

15%

20%

Contingent (1C) - Low Estimate (6)

Development Pending (10)

Australia(11)

-

-

-

-

-

-

-

-

-

-

Canada(12)

1,469,731

806,673

468,784

284,859

179,205

567,431

315,876

182,036

107,244

107,244

France(13)

819,095

435,463

247,355

146,903

90,157

582,296

295,394

158,897

88,278

49,769

Germany(14)

29,787

19,161

11,552

6,390

2,959

20,027

11,662

5,658

1,665

(894)

Ireland

-

-

-

-

-

-

-

-

-

-

Netherlands(15)

51,663

37,509

28,134

21,720

17,177

27,656

19,744

14,440

10,833

8,313

USA(16)

875,320

424,777

223,556

125,266

73,505

562,210

269,146

138,253

74,966

42,140

Total

3,245,596

1,723,583

979,381

585,138

363,003

2,261,816

1,163,377

633,124

357,778

206,572

Contingent (2C) - Best Estimate (7)

Development Pending (10)

Australia(11)

102,151

60,643

36,438

22,134

13,559

26,695

12,642

5,228

1,407

(483)

Canada(12)

2,749,285

1,453,434

840,871

519,322

337,021

2,003,094

1,033,233

579,568

345,415

215,410

France(13)

1,730,450

899,321

508,686

305,273

191,641

1,230,218

615,216

334,091

191,820

114,668

Germany(14)

103,451

71,870

50,479

35,968

25,990

74,526

50,615

34,375

23,449

16,048

Ireland

-

-

-

-

-

-

-

-

-

-

Netherlands(15)

160,324

110,209

79,494

59,475

45,757

86,998

58,171

40,486

29,074

21,367

USA(16)

1,561,749

736,050

390,965

226,282

139,356

1,007,434

471,250

247,014

140,765

85,218

Total

6,407,410

3,331,527

1,906,933

1,168,454

753,324

4,428,965

2,241,127

1,240,762

731,930

452,228

Contingent (3C) - High Estimate (8)

Development Pending (10)

Australia(11)

190,589

116,134

72,383

46,105

29,966

63,277

36,147

20,606

11,695

6,558

Canada(12)

5,020,914

2,498,830

1,392,053

837,248

532,137

3,660,740

1,782,927

966,824

563,961

346,457

France(13)

2,954,319

1,525,736

866,518

524,651

332,885

2,100,039

1,051,087

577,537

337,293

205,471

Germany(14)

252,820

174,810

124,211

90,601

67,647

184,908

126,647

88,732

63,652

46,653

Ireland

-

-

-

-

-

-

-

-

-

-

Netherlands(15)

315,718

211,894

151,407

113,180

87,473

171,705

113,248

79,106

57,702

43,468

USA(16)

2,640,857

1,172,989

614,674

358,063

224,065

1,708,970

754,738

392,026

226,212

140,202

Total

11,375,217

5,700,393

3,221,246

1,969,848

1,274,173

7,889,639

3,864,794

2,124,831

1,260,515

788,809

Contingent (1C) - Low Estimate (6)

Development Unclarified (17)

Australia

-

-

-

-

-

-

-

-

-

-

Canada(18)

81,186

32,743

13,139

4,876

1,294

58,404

22,305

7,967

2,138

(237)

France(19)

109,246

56,246

30,550

17,349

10,224

77,091

38,798

20,522

11,315

6,453

Germany

-

-

-

-

-

-

-

-

-

-

Ireland

-

-

-

-

-

-

-

-

-

-

Netherlands(20)

-

-

-

-

-

-

-

-

-

-

USA

-

-

-

-

-

-

-

-

-

-

Total

190,432

88,989

43,689

22,225

11,518

135,495

61,103

28,489

13,453

6,216

Contingent (2C) - Best Estimate (7)

Development Unclarified (17)

Australia

-

-

-

-

-

-

-

-

-

-

Canada(18)

149,050

60,346

25,047

10,046

3,342

107,851

41,837

15,842

5,073

466

France(19)

198,194

95,437

49,664

27,439

15,881

140,218

66,266

33,693

18,135

10,199

Germany

-

-

-

-

-

-

-

-

-

-

Ireland

-

-

-

-

-

-

-

-

-

-

Netherlands(20)

63,974

35,129

18,879

9,435

3,747

34,153

16,587

6,654

985

(2,320)

USA

-

-

-

-

-

-

-

-

-

-

Total

411,218

190,912

93,590

46,920

22,970

282,222

124,690

56,189

24,193

8,345

Contingent (3C) - High Estimate (8)

Development Unclarified (17)

Australia

-

-

-

-

-

-

-

-

-

-

Canada(18)

250,258

97,428

41,153

18,033

7,732

181,844

68,851

27,516

10,840

3,628

France(19)

320,784

143,786

72,178

39,161

22,464

227,214

100,294

49,348

26,186

14,667

Germany

-

-

-

-

-

-

-

-

-

-

Ireland

-

-

-

-

-

-

-

-

-

-

Netherlands(20)

176,750

94,921

54,922

33,238

20,539

96,181

48,927

25,901

13,615

6,587

USA

-

-

-

-

-

-

-

-

-

-

Total

747,792

336,135

168,253

90,432

50,735

505,239

218,072

102,765

50,641

24,882

Notes:

(1)

Contingent resources are defined in the COGEH as those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. There is no certainty that it will be commercially viable to produce any portion of the contingent resources or that Vermilion will produce any portion of the volumes currently classified as contingent resources. The estimates of contingent resources involve implied assessment, based on certain estimates and assumptions, that the resources described exists in the quantities predicted or estimated, as at a given date, and that the resources can be profitably produced in the future. The risked net present value of the future net revenue from the contingent resources does not represent the fair market value of the contingent resources. Actual contingent resources (and any volumes that may be reclassified as reserves) and future production therefrom may be greater than or less than the estimates provided herein.

(2)

GLJ prepared the estimates of contingent resources shown for each property using deterministic principles and methods. Probabilistic aggregation of the low and high property estimates shown in the table might produce different total volumes than the arithmetic sums shown in the table.

(3)

The forecast price and cost assumptions utilized in the year-end 2016 reserves report were also utilized by GLJ in preparing the GLJ Resource Assessment. See "GLJ December 31, 2016 Forecast Prices" in this AIF.

(4)

"Gross" contingent resources are Vermilion's working interest (operating or non-operating) share before deduction of royalties and without including any royalty interests of Vermilion. "Net" contingent resources are Vermilion's working interest (operating or non-operating) share after deduction of royalty obligations, plus Vermilion's royalty interests in contingent resources.

(5)

The risked net present value of future net revenue attributable to the contingent resources does not represent the fair market value of the contingent resources. Estimated abandonment and reclamation costs have been included in the evaluation.

(6)

This is considered to be a conservative estimate of the quantity that will actually be recovered. It is likely that the actual remaining quantities recovered will exceed the low estimate. If probabilistic methods are used, there should be at least a 90 percent probability (P90) that the quantities actually recovered will equal or exceed the low estimate.

(7)

This is considered to be the best estimate of the quantity that will actually be recovered. It is equally likely that the actual remaining quantities recovered will be greater or less than the best estimate. If probabilistic methods are used, there should be at least a 50 percent probability (P50) that the quantities actually recovered will equal or exceed the best estimate.

(8)

This is considered to be an optimistic estimate of the quantity that will actually be recovered. It is unlikely that the actual remaining quantities recovered will exceed the high estimate. If probabilistic methods are used, there should be at least a 10 percent probability (P10) that the quantities actually recovered will equal or exceed the high estimate.

(9)

The Chance of Development (CoDev) is the estimated probability that, once discovered, a known accumulation will be commercially developed. Five factors have been considered in determining the CoDev as follows:

  • CoDev = Ps (Economic Factor) × Ps (Technology Factor) × Ps (Development Plan Factor) ×Ps (Development Timeframe Factor) × Ps (Other Contingency Factor) wherein
  • Ps is the probability of success
  • Economic Factor – For reserves to be assessed, a project must be economic. With respect to contingent resources, this factor captures uncertainty in the assessment of economic status principally due to uncertainty in cost estimates and marketing options. Economic viability uncertainty due to technology is more aptly captured with the Technology Factor. The Economic Factor will be 1 for reserves and will often be 1 for development pending projects and for projects with a development study or pre-development study with a robust rate of return. A robust rate of return means that the project retains economic status with variation in costs and/or marketing plans over the expected range of outcomes for these variables.
  • Technology Factor - For reserves to be assessed, a project must utilize established technology. With respect to contingent resources, this factor captures the uncertainty in the viability of the proposed technology for the subject reservoir, namely, the uncertainty associated with technology under development. By definition, technology under development is a recovery process or process improvement that has been determined to be technically viable via field test and is being field tested further to determine its economic viability in the subject reservoir. The Technology Factor will be 1 for reserves and for established technology. For technology under development, this factor will consider different risks associated with technologies being developed at the scale of the well versus the scale of a project and technologies which are being modified or extended for the subject reservoir versus new emerging technologies which have not previously been applied in any commercial application. The risk assessment will also consider the quality and sufficiency of the test data available, the ability to reliably scale such data and the ability to extrapolate results in time.
  • Development Plan Factor – For reserves to be assessed, a project must have a detailed development plan. With respect to contingent resources, this factor captures the uncertainty in the project evaluation scenario. The Development Plan Factor will be 1 for reserves and high, approaching 1, for development pending projects. This factor will consider development plan detail variations including the degree of delineation, reservoir specific development and operating strategy detail (technology decision, well layouts (spacing and pad locations), completion strategy, start-up strategy, water source and disposal, other infrastructure, facility design, marketing plans etc) and the quality of the cost estimates as provided by the developer.
  • Development Timeframe Factor – In the case of major projects, for reserves to be assessed, first major capital spending must be initiated within 5 years of the effective date. The Development Timeframe Factor will be 1 for reserves and will often be 1 for development pending projects provided the project is planned on-stream based on the same criteria used in the assessment of reserves. With respect to contingent resources, the factor will approach 1 for projects planned on-stream with a timeframe slightly longer than the limiting reserves criteria.
  • Other Contingency Factor – For reserves to be assessed, all contingencies must be eliminated. With respect to contingent resources, this factor captures major contingencies, usually beyond the control of the operator, other than those captured by economic status, technology status, project evaluation scenario status and the development timeframe. The Other Contingency Factor will be 1 for reserves and for development pending projects and less than 1 for on hold. Provided all contingencies have been identified and their resolution is reasonably certain, this factor would also be 1 for development unclarified projects.
  • These factors may be inter-related (dependent) and care has been taken to ensure that risks are appropriately accounted.

(10)

Project maturity subclass development pending is defined as contingent resources where resolution of the final conditions for development is being actively pursued (high chance of development).

(11)

Contingent resources for Australia have been estimated based on the continued drilling in our active core asset (see "Description of Properties" section of this AIF) using established recovery technologies. The estimated cost to bring these contingent resources on commercial production is $142 MM and the expected timeline is between 7 and 9 years. The specific contingencies for these resources are corporate commitment and development timing.

(12)

Contingent resources for Canada have been estimated based on the continued drilling in our active core assets (see "Description of Properties" section of this AIF) using established recovery technologies. The estimated cost to bring these contingent resources on commercial production is $1,170 MM and the expected timeline is between 1 and 12 years. The specific contingencies for these resources are corporate commitment and development timing.

(13)

Contingent resources for France have been estimated based on the continued drilling in our active core assets (see "Description of Properties" section of this AIF) using established recovery technologies. The estimated cost to bring these contingent resources on commercial production is $550 MM and the expected timeline is between 3and 10 years. The specific contingencies for these resources are corporate commitment and development timing.

(14)

Contingent resources for Germany have been estimated based on the continued drilling in our active core assets (see "Description of Properties" section of this AIF) using established recovery technologies. The estimated cost to bring these contingent resources on commercial production is $55 MM and the expected timeline is between 3 and 5 years. The specific contingencies for these resources are corporate commitment and development timing.

(15)

Contingent resources for Netherlands have been estimated based on the continued drilling in our active core assets (see "Description of Properties" section of this AIF) using established recovery technologies. The estimated cost to bring these contingent resources on commercial production is $34 MM and the expected timeline is between two and 10 years. The specific contingencies for these resources are corporate commitment and development timing.

(16)

Contingent resources for USA have been estimated based on the continued drilling in our active core asset (see "Description of Properties" section of this AIF) using established recovery technologies. The estimated cost to bring these contingent resources on commercial production is $431 MM and the expected timeline is between 4 and 12 years. The specific contingencies for these resources are corporate commitment and development timing.

(17)

Project maturity subclass development unclarified is defined as contingent resources when the evaluation is incomplete and there is ongoing activity to resolve any risks or uncertainties.

(18)

In Canada, GLJ has estimated an aggregate of risked unclarified best estimate contingent resources of 14.2 mmboe for the projects outlined below. Utilizing established recovery technology, the risked estimated cost to bring these resources on commercial production is an aggregate of $108 MM with an expected timeline of 4 to 15 years.

Ferrier Notikewin

Based on contingencies related to corporate commitment and development timing that is greater than 10 years, GLJ has estimated risked unclarified best estimate contingent resources at 5.1 mmboe and the risked estimated cost to bring these resources on commercial production is $36 MM. The expected timeline is 11 to 15 years.

Ferrier Falher

Based on contingencies related to corporate commitment and development timing that is greater than 10 years, GLJ has estimated risked unclarified best estimate contingent resources at 3.8 mmboe and the risked estimated cost to bring these resources on commercial production is $28 MM. The expected timeline is 11 to 15 years.

West Pembina Glauconite

Based on contingencies related to corporate commitment and development timing as well as economic risk related to capital and operating cost uncertainty due to limited horizontal development in proximity to interest lands, GLJ has estimated risked unclarified best estimate contingent resources at 5.3 mmboe and the risked estimated cost to bring these resources on commercial production is $44 MM. The expected timeline is 4 to 10 years.

(19)

In France, GLJ has estimated an aggregate of risked unclarified best estimate contingent resources of 2.5 mmboe for the projects outlined below. Utilizing established recovery technology, the risked estimated cost to bring these resources on commercial production is an aggregate of $36 MM with an expected timeline of 8 to 10 years.

Charmottes

Based on contingencies related to corporate commitment and development timing, along with the project still being in the pre-development study/sourcing stage related to waterflood development, GLJ has estimated risked unclarified best estimate contingent resources at 1.3 mmboe and the risked estimated cost to bring these resources on commercial production is $29 MM. The expected timeline is 8 to 10 years.

Chaunoy

Based on contingencies related to corporate commitment and development timing, along with a CO2 pilot project still being in the conceptual study stage, GLJ has estimated risked unclarified best estimate contingent resources at 1.2 mmboe and the risked estimated cost to bring these resources on commercial production is $7 MM. The expected timeline is 9 to 10 years.

(20)

In the Netherlands, GLJ has estimated an aggregate of risked unclarified best estimate contingent resources of 2.8 mmboe for the projects outlined below. Utilizing established recovery technology, the risked estimated to bring these resources on commercial production an aggregate of $45 MM with an expected timeline of 3 to 9 years.

Netherlands East

Based on contingencies related to corporate commitment and development timing along with proof-of-concept utilizing directional drilling and unknown deliverability from Zechstein carbonates, GLJ has estimated risked unclarified best estimate contingent resources at 1.6 mmboe and the risked estimated cost to bring these resources on commercial production is $24 MM. The expected timeline is 3 to 9 years.

Netherlands West

Based on contingencies related to corporate commitment and development timing along with further study required regarding the deliverability of the Bunter sands, GLJ has estimated risked unclarified best estimate contingent resources at 1.2 mmboe and the risked estimated cost to bring these resources on commercial production is $21 MM. The expected timeline is 5 years.

PROSPECTIVE RESOURCES

Summary information regarding prospective resources and net present value of future net revenues from prospective resources are set forth below and are derived, in each case, from the GLJ Resources Assessment. The GLJ Resources Assessment was prepared in accordance with COGEH and NI-51-101 by GLJ, an independent qualified reserve evaluator. All prospective resources evaluated in the GLJ Resources Assessment were deemed economic at the effective date of December 31, 2016. Prospective resources are in addition to reserves estimated in the GLJ Report.

A range of prospective resources estimates (low, best and high) were prepared by GLJ. See notes 6 to 8 of the tables below for a description of low estimate, best estimate and high estimate.

The GLJ Resources Assessment estimated gross risked prospective resources of 45.2 million boe (low estimate) to 147.9 million boe (high estimate), with a best estimate of 89.5 million boe.

An estimate of risked net present value of future net revenue of prospective resources is preliminary in nature and is provided to assist the reader in reaching an opinion on the merit and likelihood of the company proceeding with the required investment. It includes prospective resources that are considered too uncertain with respect to the chance of development and chance of discovery to be classified as reserves. There is uncertainty that the risked net present value of future net revenue will be realized.

Table 12: Summary of Risked Oil and Gas Prospective Resources as at December 31, 2016 (1) (2) - Forecast Prices and Costs (3) (4)

Light Crude Oil &

Conventional

Coal Bed

Natural Gas

BOE

Unrisked

Resources

Medium Crude Oil

Natural Gas

Methane

Liquids

BOE

Project

Chance of

Maturity

Gross

Net

Gross

Net

Gross

Net

Gross

Net

Gross

Net

Commerciality

Gross

Net

Sub-Class

(Mbbl)

(Mbbl)

(MMcf)

(MMcf)

(MMcf)

(MMcf)

(Mbbl)

(Mbbl)

(Mboe)

(Mboe)

(%) (9)

(Mboe)

(Mboe)

Prospective - Low Estimate

Prospect(10)

Australia(11)

-

-

-

-

-

-

-

-

-

-

-

-

-

Canada(12)

185

166

95,116

87,039

-

-

5,458

4,703

21,496

19,376

32.9%

65,396

58,986

France(13)

3,379

3,044

-

-

-

-

-

-

3,379

3,044

49.0%

6,898

6,253

Germany(14)

-

-

88,561

76,691

-

-

-

-

14,760

12,782

24.6%

59,995

51,954

Ireland

-

-

-

-

-

-

-

-

-

-

-

-

-

Netherlands(15)

-

-

33,037

31,606

-

-

16

14

5,522

5,282

11.6%

47,452

45,232

USA

-

-

-

-

-

-

-

-

-

-

-

-

-

Total

3,564

3,210

216,714

195,336

-

-

5,474

4,717

45,157

40,484

25.1%

179,741

162,425

Prospective - Best Estimate

Prospect(10)

Australia(11)

579

579

-

-

-

-

-

-

579

579

48.0%

1,207

1,027

Canada(12)

2,263

2,029

170,797

153,565

-

-

10,195

8,412

40,924

36,035

34.3%

119,269

105,029

France(13)

9,609

8,532

-

-

-

-

-

-

9,609

8,532

37.2%

25,835

22,939

Germany(14)

-

-

169,557

147,917

-

-

-

-

28,260

24,653

24.6%

114,865

100,205

Ireland

-

-

-

-

-

-

-

-

-

-

-

-

-

Netherlands(15)

-

-

60,647

57,618

-

-

30

27

10,138

9,630

11.8%

85,890

81,192

USA

-

-

-

-

-

-

-

-

-

-

-

-

-

Total

12,451

11,140

401,001

359,100

-

-

10,225

8,439

89,510

79,429

25.8%

347,066

310,392

Prospective - High Estimate

Prospect(10)

Australia(11)

1,462

1,462

-

-

-

-

-

-

1,462

1,462

48.0%

3,046

3,046

Canada(12)

2,394

2,142

244,013

217,049

-

-

14,659

11,724

57,722

50,041

35.6%

162,333

140,646

France(13)

21,406

19,496

-

-

-

-

-

-

21,406

19,496

48.4%

44,243

40,766

Germany(14)

-

-

289,626

254,136

-

-

-

-

48,271

42,356

24.6%

196,205

172,162

Ireland

-

-

-

-

-

-

-

-

-

-

-

-

-

Netherlands(15)

-

-

114,102

106,974

-

-

59

52

19,076

17,881

11.9%

159,744

148,690

USA

-

-

-

-

-

-

-

-

-

-

-

-

-

Total

25,262

23,100

647,741

578,159

-

-

14,718

11,776

147,937

131,236

26.2%

565,571

505,310

Table 13: Summary of Risked Net Present Value of Future Net Revenues as at December 31, 2016 - Forecast Prices and Costs (3)

Resources Project

Maturity Sub-Class

Before Income Taxes, Discounted at (5)