Berens Energy Ltd.

February 26, 2009 23:59 ET

Berens Energy Ltd. Releases December 31, 2008 Reserve Information and Operating Update

CALGARY, ALBERTA--(Marketwire - Feb. 26, 2009) -

NOT FOR DISTRIBUTION INTO THE UNITED STATES OF AMERICA OR TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Berens Energy Ltd. ("Berens") is pleased to report strong year-over-year reserve growth and finding and development costs from our 2008 drilling program. Highlights of the year end reserves are as follows:



- Proved and probable reserves grew 22 percent to 11.0 million barrels

with growth coming entirely through the drill bit.

- On a per share basis, proved plus probable reserves increased from

96.8 boe per 1,000 shares to 117.3 boe per 1000 shares, also a

22 percent increase as capital spending was equal to cash flow for

the year and a nominal number of shares were issued in 2008.

- 2008 production replacement was 230 percent with new reserves on a

proved plus probable basis.

- Finding and development costs for the year were $10.52 per boe

including future development capital on a proved plus probable basis,

an 18 percent improvement compared to $12.85 per boe in 2007. On a

three year rolling average basis proved plus probable finding and

development costs were $14.54 per boe.

- Total capital, including land and future development capital and

including reserve revisions generates an all in finding and

development cost of $12.09 per boe for the year and results in a 2008

corporate recycle ratio of 2.4 times.

RESERVES

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Berens' oil and gas reserves were independently evaluated by GLJ Petroleum Consultants ("GLJ"). The evaluation was completed using the reserves definitions in the Canadian Oil and Gas Evaluation Handbook and the Canadian Securities Administrators National Instrument 51-101 ("NI 51-101"). The tables below summarize Berens' working interest reserves on a gross basis (before deduction for royalties) as at December 31, 2008 using forecast prices and costs based on the GLJ January 1, 2009 price forecast.



SUMMARY OF OIL AND GAS RESERVES(1)

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WORKING INTEREST OIL and NATURAL

RESERVES LIQUIDS GAS

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2008 2007 Percent 2008 2007 Percent

RESERVES CATEGORY (Mbbl) (Mbbl) Change (MMcf) (MMcf) Change

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PROVED

Developed

Producing 1,240 1,050 +18% 25,536 21,855 +17%

Developed

Non-Producing 204 82 +149% 2,706 1,440 +88%

Undeveloped 244 198 +23% 5,794 4,746 +22%

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TOTAL PROVED 1,688 1,330 +27% 34,036 28,041 +21%

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PROBABLE 834 665 +25% 16,667 14,085 +18%

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TOTAL PROVED PLUS

PROBABLE 2,522 1,995 +26% 50,703 42,126 +20%

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WORKING INTEREST RESERVES BOE

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2008 2007 Percent

RESERVES CATEGORY (Mbbl) (Mbbl) Change

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PROVED

Developed Producing 5,496 4,693 +17%

Developed Non-Producing 655 322 +103%

Undeveloped 1,210 989 +22%

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TOTAL PROVED 7,361 6,003 +23%

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PROBABLE 3,611 3,013 +20%

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TOTAL PROVED PLUS PROBABLE 10,972 9,016 +22%

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WORKING INTEREST BEFORE TAX 10% BEFORE TAX 15%

RESERVES PRESENT VALUE(1) PRESENT VALUE(1)

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2008 2007 Percent 2008 2007 Percent

RESERVES CATEGORY ($000's) ($000's) Change ($000's) ($000's) Change

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PROVED

Developed

Producing 110,683 86,962 +27% 95,743 77,205 +24%

Developed

Non-Producing 12,349 4,842 +155% 10,217 3,971 +157%

Undeveloped 11,875 6,640 +79% 8,254 4,598 +80%

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TOTAL PROVED 134,907 98,444 +37% 114,214 85,774 +33%

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PROBABLE 46,484 34,215 +36% 33,901 25,911 +31%

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TOTAL PROVED PLUS

PROBABLE 181,391 132,659 +37% 148,115 111,685 +33%

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(1) It should not be assumed that the present values of estimated future

net cash flows shown above are representative of the fair market

value of the reserves. There is no assurance that such price and cost

assumptions will be attained and variances could be material. The

recovery and reserves estimates of crude oil, NGL and natural gas

reserves provided herein are estimates only and there is no guarantee

that the estimated reserves will be recovered. Actual crude oil,

natural gas and NGL reserves may be greater than or less than the

estimates provided herein.

A summary of the GLJ January 1st, 2009 price forecast assumptions utilized in the analyses is as follows:

Edmonton

Crude FOB

Oil Par Field

WTI Price Hardisty AECO-C Gate Infla-

Cushing 40 degree Heavy Gas (propane/ tion Exchange

Oklahoma API Oil Price butane) rate rate

($US/ ($Cdn/ ($Cdn/ ($Cdn/ ($Cdn/ % per ($US/

Year bbl) bbl) bbl) MMbtu) bbl) year Cdn)

--------- --------- --------- -------- --------- ------- ---------

Forecast

2009 57.50 68.61 43.10 7.58 47.68 2.0 0.825

2010 68.00 78.94 49.76 7.94 55.65 2.0 0.850

2011 74.00 83.54 54.35 8.34 58.89 2.0 0.875

2012 85.00 90.92 59.23 8.70 64.10 2.0 0.925

2013 92.01 95.91 62.59 8.95 67.61 2.0 0.950

CAPITAL EFFICIENCY

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The following table reconciles the reserve additions from capital spending, acquisitions, dispositions and revisions to opening estimates.

RECONCILIATION OF

COMPANY GROSS RESERVES

BY BARREL OF OIL EQUIVALENT

---------------------------------------------

BOE

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Proved

Plus

Proved Probable

FACTORS (Mboe) (Mboe)

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December 31, 2007 6,003 9,016

Discoveries 166 254

Extensions 2,314 3,387

Technical revisions 367 (204)

Acquisitions 30 41

Dispositions (9) (12)

Economic factors 31 31

Production(1) (1,541) (1,541)

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December 31, 2008 7,361 10,972

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Capital spending (unaudited) in 2008 was $40.2 million including $3.3 million spent on land acquisitions. Proved plus probable finding and development costs for 2008 excluding land acquisitions and including the change in future development capital was $10.52 per boe on a proved plus probable basis and $15.65 per boe on a proved only basis. On a total capital basis, including land acquisitions and technical reserve revisions, proved plus probable finding and development costs were $12.09 per boe in 2008. This results in a corporate recycle ratio for 2008 of 2.4 times. The table below provides detail on finding and development costs on a three year annual and cumulative basis to December 31, 2008.



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2008(*) 2007 2006 Three

Year

Totals

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Total capital for seismic,

exploration and development

(excluding land capital) ($000's) 36,935 31,059 53,101 121,095

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Future development capital -

proved ($000's) 17,309 15,112 12,633 16,069

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Future development capital -

proved plus probable ($000's) 22,863 21,187 15,413 21,483

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Reserve extensions, discoveries

and dispositions - proved (Mboe) 2,501 1,777 2,222 6,500

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Reserve extensions, discoveries

and dispositions - proved plus

probable (Mboe) 3,670 2,868 3,271 9,809

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Finding and development costs -

proved (per boe) $15.65 $18.89 $29.12 $21.10

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Finding and development costs -

proved plus probable (per boe) $10.52 $12.85 $20.59 $14.54

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(*) 2008 capital unaudited


All calculations converting natural gas to crude oil equivalent have been made using a ratio of six thousand cubic feet ("mcf") of natural gas to one barrel of crude oil equivalent. Barrels of oil equivalent ("boe") may be misleading, particularly if used in isolation. A boe conversion ratio of six mcf of natural gas to one barrel of crude oil equivalent is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.



OPERATIONS UPDATE

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Drilling success continues into early 2009 as the 2008 program has been followed up by three more successful wells (1.5 net wells), two horizontals in Pembina and one well in Deep Basin. The first 2009 horizontal well (0.6 net) had test rates in excess of 15 million cubic feet per day and was brought on stream in mid February at restricted rates of approximately 4 million cubic feet per day. The second 2009 horizontal is cased pending completion by the operator. The successful Deep Basin well is expected to be on stream by the end of February at 0.5 million cubic feet per day. One additional horizontal was unsuccessful due to mechanical difficulties. An additional vertical well is planned in Pembina prior to break-up for a total of five wells (2.8 net) in the first quarter. A capital program of $40 million, to be funded from cash flow is budgeted for 2009 based on AECO natural gas prices of $7.00 per mcf. Spending in the first quarter is expected to be under $12 MM and if weak natural gas prices continue, management will review the capital program at the end of break-up with the ongoing objective of spending within cash flow. Berens continues to selectively add to its land position and has already added 12 (8.5 net) sections in the general Pembina area so far in 2009.

Caution Regarding Forward-Looking Information

This press release contains forward-looking information within the meaning of applicable securities laws. Forward-looking statements may include estimates, plans, expectations, forecasts, guidance or other statements that are not statements of fact. Forward-looking information in this Press Release includes, but is not limited to, statements with respect to capital expenditures and related allocations, production volumes, production mix and commodity prices.

Forward-looking statements and information are based on current beliefs as well as assumptions made by and information currently available to Berens concerning anticipated financial performance, business prospects, strategies and regulatory developments. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks that predictions, forecasts, projections and other forward-looking statements will not be achieved. We caution readers not to place undue reliance on these statements as a number of important factors could cause the actual results to differ materially from the beliefs, plans, objectives, expectations and anticipations, estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited to: crude oil and natural gas price volatility, exchange rate and interest rate fluctuations, availability of services and supplies, market competition, uncertainties in the estimates of reserves, the timing of development expenditures, production levels and the timing of achieving such levels, the Company's ability to replace and increase oil and gas reserves, the sources and adequacy of funding for capital investments, future growth prospects and current and expected financial requirements of the Company, the cost of future abandonment and site restoration, the Company's ability to enter into or renew leases, the Company's ability to secure adequate product transportation, changes in environmental and other regulations and general economic conditions.

The forward-looking statements contained in this press release are made as of the date of this press release, and Berens does not undertake any obligation to up-date publicly or to revise any of the included forward- looking statements, whether as a result of new information, future events or otherwise. This cautionary statement expressly qualifies the forward-looking statements contained in this press release.

Contact Information

  • Berens Energy Ltd.
    Mr. Daniel F. Botterill
    President and Chief Executive Officer
    (403) 303-3262
    Email: dbotterill@berensenergy.com

    OR

    Berens Energy Ltd.
    Mr. Dell P. Chapman
    Vice President, Finance and Chief Financial Officer
    (403) 303-3267
    Email: dchapman@berensenergy.com