CALGARY, June 11, 2019 /CNW/ - Pulse Oil Corp. ("Pulse" or the "Company") (TSX-V: PUL and PUL.WT) is pleased to announce the key findings of Pulse's enhanced oil recovery ("EOR") study.
Schlumberger Canada Ltd, one of the world's leading providers of technology for reservoir characterization, drilling, production, and processing to the oil and gas industry, was awarded the contracts to complete all three phases of the Company's petrotechnical modelling of the Bigoray Nisku D and E Pools, prior to physical implementation of the EOR schemes.
The three phases of Pulse's EOR study were defined as:
Geological and Geophysical Modelling
The EOR study has an effective date of March 2019 and the key factors and the conclusions from the EOR study are as follows:
- The three phases of the EOR study, conducted by Schlumberger Canada Ltd. are the first ever 3-dimensional analysis on the Nisku D & E pinnacle reefs.
- The reservoir simulation conducted as part of the EOR study included over 200 separate computer iterations of historical production, adjusting the geo-model after every iteration to ensure the model was as accurate as possible based on historical production and modern 3-D interpretations, before beginning the solvent flood forecast.
- The detailed simulation allowed the team to model the most effective positioning of solvent injectors, pressures and rates of injected fluids and optimum production take-points to maximise ultimate recovery from these established pools.
- The go-forward simulation under the EOR program resulted in a peak estimated Nisku D-Pool production rate of approximately 2,000 barrels of oil/day, with peak production, including Nisku E production increasing to approximately 3,000 barrels of oil/d If the Nisku D-Pool was implemented first and Nisku E-Pool was started 3 years after.
- This production simulation was prepared, at Pulse's request, to assume the EOR program is instituted on the Nisku D pool solely at first, in order for Pulse to preserve working capital and begin generating cash flow prior to funding the Nisku E program.
- Pulse, subject to having sufficient working capital, has the option to accelerate the EOR program and initiate the Nisku E Pool EOR program in conjunction with the D pool. As a result of this work to date, Pulse estimates that the simultaneous implementation of both pools results in peak forecast rates of approximately 5,000 barrels/day.
- Forecast production would peak within two years of implementation of the EOR program and will continue on primary solvent flood production for approximately ten years, followed by a production "blow-down" period that is estimated to continue for another ten and up to 20 years with proper oil field management.
Drew Cadenhead, Pulse President and COO, commented, "Using modern 3-D seismic and cutting edge digital visualisation software is a first for these 40-year old pools. The resultant increase in Discovered Petroleum Initially In Place led to a significant increase to our internal forecasts for potential recoveries from our two pools. Adding these types of growth opportunities with very little/no exploration risk fits the Pulse game plan perfectly. These are different times in our industry, and we feel low-risk value creation is key for start-ups like ourselves to prosper."
About Pulse Oil Corp.
Pulse is a debt-free, Canadian company incorporated under the Business Corporations Act (Alberta) that is focused on methodically, safely, yet aggressively making progress to increase production and reserves in the Queenstown and Bigoray acreages it holds 100% interests in. In addition, Pulse is advancing its Bigoray EOR program and new drilling efforts in Queenstown. Pulse owns 100% interests in the Bigoray area of Alberta, which includes two Nisku oil pinnacle reefs, as well as 100% interests in producing assets in the Queenstown area of southern Alberta. Pulse is moving forward to grow production and execute an EOR project to unlock significant value for shareholders through control of approximately 65 net sections of land across the Mannville, Cardium, Pekisko/Shunda, Nisku and Duvernay Shale trends in Western Canada. Pulse will also continue to focus on potentially acquiring affordable, small to medium sized proven oil and gas assets with significant upside. The Company plans to achieve further growth through low-risk, technically diligent drilling within its Queenstown assets, infrastructure ownership and reserve growth utilizing proven EOR techniques and implementation of technology.
Neither the TSX Venture Exchange, Inc. nor its Regulation Service Provider (as that term is defined under the policies of the TSX Venture Exchange) has neither approved nor disapproved of the contents of this press release.
This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The words "believe," "expect," "anticipate," "plan," "intend," "foresee," "should," "would," "could", "potentially" or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. Such statements include, without limitation, statements pertaining to the Bigoray and Queenstown operations currently underway, including production rates, cash flow, drilling plans and results, production testing, well completion, anticipated future production, and facilities related to the assets of Pulse Oil. In addition such statements also include without limitation, statements pertaining to the expected Bigoray EOR project and its planned development.
The forward-looking statements are based on management's current expectations and beliefs concerning future developments and their potential effect on the Company based on information currently available to management. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting Pulse will be those anticipated. Forward-looking information involves known and unknown risks, uncertainties, assumptions and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. Important factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to: production and drilling results that deviate from management's current expectations; delays in the Company's drilling activities and tie-in of infrastructure; the volatility of commodity prices, product supply and demand, competition, access to and cost of capital, the assumptions underlying production forecast, the quality of technical data; environmental and weather risks, including the possible impacts of climate change, the ability to obtain environmental and other permits and the timing thereto, government regulation or action, the costs, timing and results of drilling operations; the availability of equipment, services, resources and personnel required to complete the Company's planned operating activities; access to and availability of transportation, processing and refining facilities, acts of war or terrorism; and general economic conditions and other financial, operational and legal risks and uncertainties. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligations to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Barrels of oil equivalent (boe) is calculated using the conversion factor of 6 mcf (thousand cubic feet) of natural gas being equivalent to one barrel of oil. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf:1 bbl (barrel) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis.
Resources encompasses all petroleum quantities that originally existed on or within the earth's crust in naturally occurring accumulations, including Discovered and Undiscovered (recoverable and unrecoverable) plus quantities already produced. "Total Resources" is equivalent to "Total Petroleum Initially In-Place". Resources are classified in the following categories:
Total Petroleum Initially In-Place ("TPIIP") is that quantity of petroleum that is estimated to exist originally in naturally occurring accumulations. It includes that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations, prior to production, plus those estimated quantities in accumulations yet to be discovered.
Discovered Petroleum Initially In-Place ("DPIIP") is that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations prior to production. The recoverable portion of DPIIP includes production, reserves, and Contingent Resources; the remainder is unrecoverable.
Contingent Resources are 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. Economic Contingent Resources (ECR) are those contingent resources that are currently economically recoverable.
Undiscovered Petroleum Initially In Place ("UPIIP") is that quantity of petroleum that is estimated, on a given date, to be contained in accumulations yet to be discovered. The recoverable portion of UPIIP is referred to as Prospective Resources and the remainder is unrecoverable.
Prospective Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective Resources have both an associated chance of discovery and a chance of development.
Unrecoverable is that portion of DPIIP and UPIIP quantities which is estimated, as of a given date, not to be recoverable by future development projects. A portion of these quantities may become recoverable in the future as commercial circumstances change or technological developments occur; the remaining portion may never be recovered due to the physical/chemical constraints represented by subsurface interaction of fluids and reservoir rocks. Uncertainty Ranges are described by the Canadian Oil and Gas Evaluation Handbook as low, best, and high estimates for reserves and resources as follows:
Low Estimate: 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.
Best Estimate: 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.
High Estimate: 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.
Development Unclarified is a project maturity sub-class of contingent resources that refers to the development plan evaluation is not complete and there is ongoing activity to resolve any risks or uncertainties.
Certain resource estimate volumes disclosed herein are arithmetic sums of multiple estimates of DPIIP or UPIIP, which statistical principles indicate may be misleading as to volumes that may actually be recovered. Readers should give attention to the estimates of individual classes of resources and appreciate the differing probabilities of recovery associated with each class as explained under this Resource Definitions section.
SOURCE Pulse Oil Corp.