- Published: 20 March 2009
- Written by Editor
Stealth Increases Reserves by 71% on Alberta Shale Gas Play
Stealth Ventures Ltd. ("Stealth" or the "Company") in accordance with disclosure requirements prescribed by National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities ("NI 51-101") is pleased to announce the results of its 2008 independent reserve evaluation report by Sproule Associates Limited (Sproule).
Highlights
- Moved the Cretaceous Colorado from an Exploration play to a Development play in 2008.
- Total Proved Plus Probable reserves (TP+P) increase of 71% in 2008 from 2007.
- Increase to 3.22 MBOE on TP+P (gross) exclusively through the drill
bit
- Decrease in 2008 full cycle (drill, complete and tie-in) capital
expenditures from $373,000/well to $300,000/well. This represents a
20% reduction from 2007
- Reserve Life Index of 12.6 years based on gross TP+P divided by 2009
yearly production as forecasted by Sproule
- The net present value (NPV) of Stealth's TP+P with forecast price and
10% discount before tax is $29.1 million, a 111% increase over the
2007 Sproule report
- Per share NPV TP+P per above is approximately 32 cents per share at
December 31, 2008
>>
Stealth has experienced substantial growth in 2008, building itself from a pure exploration play to a high impact (400+ immediate development drilling locations) lower risk production company. Stealth has proven the production and reserves potential of the Colorado shales. In addition, ongoing reductions in capital costs have made the Cretaceous Colorado shales a substantial classic resource play. The 2008 capital program has resulted in improvements to reservoir quality and increased potential land prospects. The Company has expanded its inventory of resource through the development of lower geological zones in the Wildmere area. The development program in Alberta has demonstrated good productive capability and will form a key corporate focus for solid growth in 2009 and beyond.
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NI 51-101
Summary of Oil and Gas Reserves
as of December 31, 2008
Forecast Prices and Costs
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Reserves
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Natural Gas Natural
Light and (non-associated Gas
Medium Oil Heavy Oil & associated) Liquids
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Reserve Category Gross Net Gross Net Gross Net Gross Net
(Mbbl) (Mbbl) (Mbbl) (Mbbl) (MMcf) (MMcf) (Mbbl)(Mbbl)
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Proved
Developed
Producing 0.0 0.0 0.0 0.0 6,212 5,603 0.0 0.0
Developed
Non-Producing 0.0 0.0 0.0 0.0 918 871 0.0 0.0
Undeveloped 0.0 0.0 0.0 0.0 7,729 7,027 0.0 0.0
Total Proved 0.0 0.0 0.0 0.0 14,860 13,501 0.0 0.0
Probable 0.0 0.0 0.0 0.0 4,479 4,067 0.0 0.0
Total Proved
Plus Probable 0.0 0.0 0.0 0.0 19,339 17,568 0.0 0.0
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Reference: Item 2.2(1) of Form 51-101F1
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NI 51-101
Summary of Net Present Values of
Future Net Revenue
as of December 31, 2008
Forecast Prices and Costs
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Net Present Values of Future Net Revenue
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Before Income Taxes
Discounted at (%/Year)
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Reserves Category 0 5 10 15 20
(M$) (M$) (M$) (M$) (M$)
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Proved
Developed
Producing 18,976 16,203 14,058 12,395 11,086
Developed
Non-Producing 2,375 1,971 1,631 1,358 1,141
Undeveloped 9,653 4,433 788 -1,723 -3,465
Total Proved 31,003 22,607 16,477 12,029 8,762
Probable 22,000 16,194 12,621 10,302 8,715
Total Proved Plus
Probable 53,004 38,801 29,098 22,331 17,476
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Net Present Values of Future Net Revenue
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After Income Taxes Future
Discounted at (%/Year) Net Val
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Reserves Category 0 5 10 15 20 10%/yr
(M$) (M$) (M$) (M$) (M$) ($/boe)
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Proved
Developed
Producing 18,976 16,203 14,058 12,395 11,086 15.05
Developed
Non-Producing 2,375 1,971 1,631 1,358 1,141 11.24
Undeveloped 9,653 4,433 788 -1,723 -3,465 0.67
Total Proved 31,003 22,607 16,477 12,029 8,762 7.32
Probable 22,000 16,194 12,621 10,302 8,715 18.62
Total Proved Plus
Probable 53,004 38,801 29,098 22,331 17,476 9.94
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Reference Item 2.2(2) of Form 51-101F1
Notes: NPV of FNR include all Income Taxes:
resource income: Includes all resource income
Sale of oil, gas, Apply appropriate income tax
by-product reserves calculations
Processing third party Include prior tax pools
reserves
Other income
Unit Values are based on net reserve volumes
NI 51-101
Net Present Value of Future Net Revenue
by Production Group
as of December 31, 2008
Forecast Prices and Costs
Future Net Unit Value
Revenue Before Before Income
Income Taxes Taxes
Reserves (Discounted at (Discounted at
Category Production Group 10%/Year) 10%/Year)
(M$) ($/boe)
Proved Light and Medium Crude
Oil (including solution
gas and associated
by-products) 0 0
Heavy Oil (including
solution gas and
associated by-products) 0 0
Natural Gas (including
associated by-products)* 16,477 7.32
Proved
Plus
Probable Light and Medium Crude
Oil (including solution
gas and associated
by-products) 0 0
Heavy Oil (including
solution gas and
associated by-products) 0 0
Natural Gas (including
associated by-products)* 29,098 9.94
Reference Item 2.1(3)(c) of Form 51-101F1
* Includes corporate Capital GCA, if applicable
Unit Values are based on net reserve volumes
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NI 51-101
Summary of Pricing and Inflation Rate Assumptions
As of December 31, 2008
Forecast Prices and Costs
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Natural Gas(1) AECO Gas Prices Inflation Rate(1) (%/Yr)
($Cdn/MMBtu)
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Historical
2004 6.87 1.4
2005 8.58 1.3
2006 7.16 1.5
2007 6.65 2.0
2008 (Est.) 8.15 1.0
Forecast
2009 7.20 2.0
2010 7.89 2.0
2011 8.21 2.0
2012 8.72 2.0
2013 9.24 2.0
Thereafter Various Escalation Rates
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Inflation rates for forecasting prices and costs. Notes: Product sale
prices will reflect these reference prices with further adjustments for
quality and transportation to point of sale.
Reference Item 3.2 of Form 51-101F1
>>
Net Present Value
The following table sets forth the estimated future net revenue attributed to proved plus probable reserves, estimated using forecast prices and costs on a before tax basis and calculated using a discount rate of 10 percent, included in the reserves data of the Company evaluated by Sproule as of December 31, 2008 and identifies the respective portions thereof that Sproule have audited, evaluated and reviewed and reported on to the Company's management and Board of Directors:
<<
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Independent Description Location Net Present Value of Future Net
Qualified and of Reserves Revenue Before Income Taxes
Reserves Preparation (Country) (10% Discount Rate)
Evaluator Date of ------------------------------------
or Auditor Evaluation Audited Evaluated Reviewed Total
Report (M$) (M$) (M$) (M$)
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Sproule Evaluation of Canada
P&NG Reserves
of Stealth
Ventures Ltd.,
As of December
31, 2007,
prepared
January to
February 2008
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Total Nil 29,050 Nil 29,098
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>>
Detailed reserve information will be presented in the Company's upcoming fourth quarter and year-end financial results press release and in the National Instrument Form 51-101F1, Statement of Reserves Data and Other Oil and Gas Information scheduled to be filed on SEDAR on or before April 30, 2009.
Stealth Ventures Ltd. is a Calgary-based junior oil and gas company whose expertise and focus is on "unconventional" gas reserves from shale gas, CBM and tight gas sand reservoirs.
<< STEALTH VENTURES LTD. "Derek Krivak" Per: DEREK KRIVAK Chief Executive Officer >>
READER ADVISORY
Forward Looking Statements: Certain information regarding the Company in this news release including management's assessment of reserve and production estimates, reserves additions and estimates of future net revenue and net asset value may constitute forward-looking statements under applicable securities laws and necessarily involve risks including, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, the timing and length of plant turnarounds and the impact of such turnarounds and the timing thereof, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources.
The recovery and reserve estimates of Stealth's reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. In addition, forward looking statements or information are based on a number of factors and assumptions which have been used to develop such statements and information but which may prove to be incorrect. As a consequence, the Company's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly no assurance can be given that any events anticipated by the forward-looking statements will transpire or occur, or, if any of them do so, what benefits the Company will derive there from. Although Stealth 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 Stealth can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among other things; the impact of increasing competition; the general stability of the economic and political environment in which Stealth operates; the timely receipt of any required regulatory approvals; the ability of Stealth to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects which Stealth has an interest in to operate the field in a safe, efficient and effective manner; the ability of Stealth to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration; the timing and cost of pipeline, storage and facility construction and expansion and the ability of Stealth to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Stealth operates; and the ability of Stealth to successfully market its oil and natural gas products. Readers are cautioned that the foregoing list of factors and assumptions is not exhaustive. Additional information on these and other factors that could effect the Company's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com), and the Company's website (www.stealthventures.ca). Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise except as may be required by applicable securities laws
Disclosure provided herein in respect of BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 Bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
<< THE TSX VENTURE EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE. THIS NEWS RELEASE MAY CONTAIN FORWARD-LOOKING INFORMATION. ACTUAL FUTURE RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTEMPLATED. >>
%SEDAR: 00008195E
SOURCE: Stealth Ventures Ltd.
Derek Krivak, CEO, Mark J. Roth, CFO, Stealth Ventures Ltd., Tel.: (403) 514-9998, Fax: (403) 514-9995, Emails: This email address is being protected from spambots. You need JavaScript enabled to view it.; Richard Cohen, Investor Relations, Clark Avenue Company, Tel.: (905) 882-4422, Fax: (905) 882-4435, Email: This email address is being protected from spambots. You need JavaScript enabled to view it.
