Tango Energy Inc.
TSX VENTURE : TEI

Tango Energy Inc.

January 29, 2010 09:00 ET

Tango Releases Year-End Reserves

CALGARY, ALBERTA--(Marketwire - Jan. 29, 2010) - Tango Energy Inc. (TSX VENTURE:TEI)

Oil and Gas Reserves

Tango's proved plus probable petroleum and natural gas reserves (working interest before royalty) increased 25%, after production, to 2,366 mboes as at December 31, 2009. Reserves increased due to success at Quaich. Proven plus probable reserve additions and revisions after production were 468 mboe, which replaced approximately 270% of Tango's production volumes during 2009.

The following tables provide information on Tango's petroleum oil and gas reserves and the present value of the estimated future net cash flow associated with such reserves as at December 31, 2009. The information set forth below is derived from the Paddock Lindstrom report, which has been prepared in accordance with the standards contained in the COGE Handbook and the reserves definitions contained in NI 51-101. It should not be assumed that the estimated future net cash flow shown below is representative of the fair market value of the Corporation's properties. There is no assurance that such price and cost assumptions will be attained and variances could be material. "Gross" reserve quantities include the Company's share of reserves before royalty plus royalty income volumes. "Net" reserve quantities include the Company's share of reserves after royalty plus royalty income volumes.

 
SUMMARY OF OIL AND GAS RESERVES
AND NET PRESENT VALUES OF FUTURE NET REVENUE
 as of December 31, 2009
 
FORECAST PRICES AND COSTS
 
  RESERVES
  NATURAL GAS NATURAL GAS LIQUIDS BOE's
RESERVES CATEGORY Gross (mmcf) Net (mmcf) Gross (mbbl) Net (mbbl) Gross (mbbl) Net (mbbl)
             
PROVED            
  Developed Producing 3,133 2,061 10 10 532 354
  Developed Non-Producing 4,228 3,169 28 26 733 554
  Undeveloped -- -- -- -- -- --
TOTAL PROVED 7,361 5,230 38 36 1,265 908
PROBABLE 6,226 4,654 63 62 1,101 838
TOTAL PROVED PLUS PROBABLE 13,587 9,884 101 98 2,366 1,746
   
   
   
  NET PRESENT VALUES OF FUTURE NET REVENUE
   
     
  BEFORE INCOME TAXES DISCOUNTED AT AFTER INCOME TAXES DISCOUNTED AT
     
RESERVES CATEGORY 0% (m$) 5% (m$) 10% (m$) 15% (m$) 20% (m$) 0% (m$) 5% (m$) 10% (m$) 15% (m$) 20% (m$)
                     
PROVED                    
  Developed Producing 9,915 8,403 7,316 6,504 5,876 7,339 6,213 5,404 4,802 4,337
  Developed Non-        Producing 16,421 13,788 11,957 10,592 9,529 12,154 10,142 8,748 7,711 6,906
  Undeveloped -- -- -- -- -- -- -- --   --
TOTAL PROVED 26,336 22,191 19,273 17,096 15,405 19,493 16,355 14,152 12,513 11,243
PROBABLE 23,393 16,082 11,735 8,911 6,962 17,581 11,984 8,649 6,481 4,985
TOTAL PROVED PLUS PROBABLE 49,729 38,273 31,008 26,007 22,367 37,074 28,339 22,801 18,994 16,228
                     

As of January 8, 2010 proved developed producing reserves include an additional 2,023 mmcf of reserves with a present value of $6.7 million, discounted at 10%, transferred from proved developed non-producing reserves. This change is due to the 12-34 well at Quaich commencing production on January 8, 2010.

SUMMARY OF PRICING AND INFLATION RATE ASSUMPTIONS
as of December 31, 2009
FORECAST PRICES AND COSTS
   
Year NATURAL GAS Condensate INFLATION EXCHANGE
AECO C Edmonton RATES RATE
($Cdn/mmBTU) ($Cdn/bbl) %/Year ($US/Cdn)
Forecast        
2010 5.82 83.25 0.0 0.95
2011 6.29 85.87 2.0 0.95
2012 6.77 88.49 2.0 0.95
2013 7.28 93.77 2.0 0.95
2014 7.80 99.05 2.0 0.95

Forecast product prices and operating costs were escalated at a rate of 2.0% per year beyond 2014. The exchange rate used for the US/Canadian dollar was 0.95. The forecast prices presented above utilize Paddock Lindstrom's price forecast as at December 31, 2009.

Additional reserve information will be included in Tango's NI 51-101 report, which will be filed on SEDAR.

This release contains forward-looking information. By their nature, forward-looking statements involve assumptions and known and unknown risks and uncertainties that may cause actual future results to differ materially from those contemplated. These risks include such things as volatility of oil and gas prices, commodity supply and demand, fluctuations in currency and interest rates, ultimate recoverability of reserves, timing and costs of drilling activities and pipeline construction, new regulations and legislation and availability of capital. Tango does not undertake to update any of such forward-looking statements. Please refer to Tango's Annual Report for more detail as to the nature of these risks and uncertainties. Although Tango believes that the expectations represented by these forward looking statements are reasonable, there can be no assurance that such expectations will prove to be correct.

BOE's may be misleading, particularly if used in isolation. In accordance with NI 51-101, a barrel of oil equivalent (boe) conversion ratio of 6 mcf: 1 boe is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Abbreviations used are defined as flows: m$ (thousands of dollars); mcf (thousand standard cubic feet); mmcf (million standard cubic feet); mboe (thousands of barrels of oil equivalent); mmBTU (million British Thermal Units).

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

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Tango Energy Inc.
    John M. Gunn
    Chief Executive Officer
    (403) 266-5688
    (403) 266-8817 (FAX)
    or
    Tango Energy Inc.
    Jeremy Newton
    President & COO
    (403) 266-5688
    (403) 266-8817 (FAX)