Petro-Reef Resources Ltd.
TSX VENTURE : PER

Petro-Reef Resources Ltd.

November 26, 2010 19:00 ET

Petro-Reef Resources Ltd. Announces Q3-2010 Financial and Operational Results

CALGARY, ALBERTA--(Marketwire - Nov. 26, 2010) - Petro-Reef Resources Ltd. (TSX VENTURE:PER),

Petro-Reef Resources Ltd. ("Petro-Reef" or the "Corporation") is pleased to release its Q3 - 2010 financial statements and management discussion and analysis. Access to Petro-Reef's Q3 – 2010 results may be obtained at www.sedar.com or www.petro-reef.ca.

Q3 – 2010 Highlights:

  • Gross revenue of $2,158,544
  • Cash flow from operations of $544,138
  • Royalty rate of 14.3% as production shifts to lands which attract Freehold royalties as compared to Crown royalties

On October 4, 2010, Petro-Reef brought onstream its discovery oil well at a rate of approximately 300 boe/d, including 100 bbls/d of crude oil in the Corporation's core area of Alexander. As a result of the addition of this high impact well, Petro-Reef's current production has risen to 1,000 boe/d, including 200 bbls/d of crude oil. 

Based on the strong stabilized production rate of the discovery oil well, Petro-Reef commenced drilling a follow-up location located approximately 500 meters from the discovery well this week (79% working interest), with test results expected to be announced in December. With the follow-up location located approximately 500 meters from Petro-Reef's existing infrastructure, the Corporation anticipates adding production from the follow-up well by January. Assuming the follow-up location is comparable to the discovery well, Petro-Reef anticipates production to be approximately 1,200-1,300 boe/d upon the tie-in of the follow-up well, including 300-350 bbls/d of crude oil. 

Forward-Looking Statements: All statements, other than statements of historical fact, set forth in this news release, including without limitation, assumptions and statements regarding reservoirs, resources and reserves, future production rates, exploration and development results, financial results, and future plans, operations and objectives of the Corporation are forward-looking statements that involve substantial known and unknown risks and uncertainties. Some of these risks and uncertainties are beyond management's control, including but not limited to, the impact of general economic conditions, industry conditions, fluctuation of commodity prices, fluctuation of foreign exchange rates, environmental risks, industry competition, availability of qualified personnel and management, availability of materials, equipment and third party services, stock market volatility, timely and cost effective access to sufficient capital from internal and external sources. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable by the Corporation at the time of preparation, may prove to be incorrect. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.

Reference is made to barrels of oil equivalent (boe). Barrels of oil equivalent may be misleading, particularly if used in isolation. In accordance with National Instrument 51-101, a boe conversion ratio for natural gas of 6 Mcf: 1 bbl has been used, which 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 does not accept responsibility for the adequacy or accuracy of this news release.

Contact Information

  • Petro-Reef Resources Ltd.
    John Pantazopoulos
    Vice-President Finance and CFO
    (403) 265-6444
    or
    Petro-Reef Resources Ltd.
    970, 10655 Southport Road S.W.
    Calgary, Alberta T2W 4Y1
    (403) 264-1348 (FAX)
    info@petro-reef.ca
    www.petro-reef.ca