Santa Maria Petroleum Inc.

TSX VENTURE : SMQ


Santa Maria Petroleum Inc.

November 28, 2012 07:57 ET

Santa Maria Petroleum Inc. Releases Summary of Interim Reserve Report

CALGARY, ALBERTA--(Marketwire - Nov. 28, 2012) - Santa Maria Petroleum Inc. (TSX VENTURE:SMQ) ("Santa Maria" or the "Company") is pleased to announce that it has obtained an updated reserve evaluation of its oil and gas properties effective June 30, 2012 (the "Updated Reserves Report") as prepared by Petrotech Engineering Ltd. ("Petrotech"), an independent qualified reserves evaluator. Petrotech is the Company's independent qualified reserve evaluator for annual disclosure requirements. The Updated Reserves Report is an update to the reserve evaluation of the Company's oil and gas properties effective December 31, 2011 (the "2011 Report") as prepared by Petrotech and is based on the completion, testing and production of the Flami field in Block 27 and revisions to operating costs and reserve data for the Canaguay well in the Canaguaro field based on operations and production from January 1, 2012 to June 30, 2012.

A summary report is available for review on SEDAR at www.sedar.com.

The Updated Reserves Report presented a 219% increase to the Company's net proved and probable ("2P") heavy oil reserves and a 259% increase to the before-tax net present value of 2P reserves at a 10% discount rate as compared to the annual filing, effective December 31, 2011. All of the Company's reserves are located in Colombia. The Company only has heavy oil reserves.

MARKETABLE OIL AND GAS RESERVES

Proved and Probable Reserves and Net Present Values (in $US)

(Forecast Prices and Costs)

Reserve NPV of Future Net Revenue Before Tax
Category Heavy Oil Reserves Discounted (in M$) @
100% Gross Net 0% 5% 10% 15% 20%
(Mbbl) (Mbbl) (Mbbl) (M$) (M$) (M$) (M$) (M$)
Proved:
Developed Producing 414 104 95 3,288 2,986 2,734 2,521 2,340
Developed Non-Producing 304 136 124 5,770 5,391 5,060 4,768 4,509
Undeveloped 1,824 530 485 4,671 3,351 2,301 1,454 764
Total Proved 2,542 770 704 13,729 11,729 10,095 8,744 7,613
Probable:
Developed Producing 205 51 47 2,466 2,155 1,910 1,713 1,553
Developed Non-Producing 125 35 32 1,981 1,869 1,771 1,684 1,607
Undeveloped 2,333 703 643 22,036 18,560 15,885 13,788 12,115
Total Probable 2,663 789 722 26,483 22,584 19,565 17,185 15,275
Total Proved + Probable 5,205 1,559 1,426 40,213 34,312 29,660 25,929 22,888

CANAGUARO FIELD

Proved and Probable Reserves and Net Present Values (in $US) for the Canaguaro Block

(Forecast Prices and Costs)

NPV of Future Net Revenue Before Tax
Heavy Oil Reserves Discounted(in M$) @
Reserve Category 100% Gross Net 0% 5% 10% 15% 20%
(Mbbl) (Mbbl) (Mbbl) (M$) (M$) (M$) (M$) (M$)
Proved:
Developed Producing 414 104 95 3,288 2,986 2,734 2,521 2,340
Undeveloped 1,021 255 235 1,975 1,194 589 117 -258
Total Proved 1,435 359 330 5,264 4,180 3,324 2,638 2,082
Probable:
Developed Producing 205 51 47 2,466 2,155 1,910 1,713 1,553
Undeveloped 1,033 258 238 6,803 5,459 4,472 3,735 3,176
Total Probable 1,238 309 285 9,269 7,613 6,382 5,449 4,729
Total Proved + Probable 2,673 668 615 14,532 11,793 9,705 8,087 6,811

Total Future Net Revenue, Undiscounted (in $US) for the Canaguaro Block

(Forecast Prices and Costs)


Reserves Category
Revenue ANH Royalty ORR Capital Exp. Variable Op. Exp. Fixed Op. Exp. Pipeline Tariff Future Net Revenue
(M$) (Mbbl) (M$) (M$) (M$) (M$) (M$) (M$)
Proved:
Developed Producing 8,431 8 506 77 2,270 1,615 675 3,288
Developed Non-Producing
Undeveloped 20,775 20 1,247 6,599 5,771 3,468 1,715 1,975
Total Proved 29,207 29 1,752 6,676 8,041 5,084 2,390 5,264
Probable:
Developed Producing 4,161 4 250 0 1,129 -19 336 2,466
Developed Non-Producing
Undeveloped 21,028 21 1,262 3,440 5,957 1,796 1,770 6,803
Total Probable 25,189 25 1,511 3,440 7,086 1,777 2,106 9,269
Total Proved + Probable 54,395 53 3,264 10,116 15,126 6,861 4,496 14,532

FLAMI FIELD

Proved and Probable Reserves and Net Present Values (in $US) for the LLA Block-27

(Forecast Prices and Costs)

NPV of Future Net Revenue Before Tax
Heavy Oil Reserves Discounted(in M$) @
Reserves Category 100% Gross Net 0% 5% 10% 15% 20%
(Mbbl) (Mbbl) (Mbbl) (M$) (M$) (M$) (M$) (M$)
Proved:
Developed Producing 304 136 124 5,770 5,391 5,060 4,768 4,509
Undeveloped 803 275 251 2,695 2,157 1,711 1,338 1,022
Total Proved 1,107 411 374 8,465 7,549 6,771 6,106 5,531
Probable:
Developed Producing 125 35 32 1,981 1,869 1,771 1,684 1,607
Undeveloped 1,300 445 405 15,234 13,101 11,413 10,053 8,940
Total Probable 1,425 480 437 17,215 14,970 13,183 11,737 10,546
Total Proved + Probable 2,532 891 811 25,680 22,519 19,954 17,842 16,078

Total Future Net Revenue, Undiscounted (in $US) for the LLA Block 27

(Forecast Prices and Costs)

Revenue CapEx Variable OpEx Fixed OpEx Pipeline Tariff Future Net Revenue
Reserves Category (M$) (M$) (M$) (M$) (M$) (M$)
Proved:
Developed Producing 10,802 343 1,173 1,228 2,289 5,770
Developed Non-Producing
Undeveloped 21,496 4,088 2,805 6,925 4,983 2,695
Total Proved 32,299 4,430 3,978 8,153 7,271 8,465
Probable:
Developed Producing 2,770 0 300 -95 584 1,981
Developed Non-Producing
Undeveloped 35,045 942 4,647 5,970 8,253 15,234
Total Probable 37,815 942 4,946 5,875 8,837 17,215
Total Proved + Probable 70,114 5,372 8,925 14,028 16,108 25,680

Pricing Assumptions

The June 29, 2012 oil price closed at $84.96 per barrel for West Texas Intermediate (WTI),$92.46 per barrel for Vasconia Oil (posted Colombian export oil from Platts South America) and at $97.53 per barrel for Brent. The forecast Vasconia oil price is $91.80 per barrel for the remaining months of 2012. All future commodity prices of crude oil prices were taken from NYMEX (www.cmegroup.com) on the last day of trading in June 2012. The historical prices for oil were taken from Sproule and Associates Inc. A table of forecast crude oil prices is provided on the summary report.

Reconciliation of Reserves

The following table sets out the reconciliation of the Corporation's net reserves based on forecast prices and costs from December 31, 2011 to June 30, 2012.

Heavy Oil Reserves
Net proved Net probable Net proved and probable
Opening balance 173 274 447
Technical revisions 177 11 188
Discoveries - Flami-1 374 437 811
Production (22) - (22)
Closing balance 702 722 1,424

About Santa Maria Petroleum Inc.

Santa Maria is a junior oil and gas company with private participating interests in 4 blocks in the Llanos Basin of Colombia.

Cautionary Statements

This news release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws (together, "forward-looking information"). The use of any of the words "expect", "anticipate", "continue", "estimate", "believe", "plans", "intends", "confident", "may", "objective", "ongoing", "will", "should", "project", "should" and similar expressions are intended to identify forward-looking information.

The forward-looking information is based on certain key expectations and assumptions made by Santa Maria, including expectations and assumptions concerning the operational results in Colombia. Although Santa Maria believes that the expectations and assumptions on which the forward-looking information is based are reasonable, undue reliance should not be placed on the forward-looking information because Santa Maria can give no assurance that they will prove to be correct.

Since forward-looking information addresses future events and conditions, by its very nature it involves inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the inherent risks involved in the exploration and development of oil and gas properties, the uncertainties involved in interpreting drilling results and other geological data, uncertainties relating to fluctuating oil and gas prices, the possibility of cost overruns or unanticipated costs and expenses and other factors including unforeseen delays. Anticipated exploration and development plans relating to Santa Maria's properties are subject to change.

The reserves and future net revenue in this news release represent estimates only. The reserves and future net revenue from the Company's properties have been independently evaluated by Petrotech with an effective date of December 31, 2011 and updated to June 30, 2012. This evaluation includes a number of assumptions relating to factors such as initial production rates, production decline rates, ultimate recovery of reserves, timing and amount of capital, salvage values, royalties and other government levies that may be imposed during the producing life of the reserves.

These assumptions were based on the price forecast of Sproule and Associates Inc. and many of these assumptions are subject to change and are beyond the control of the Company. Actual production, sales and cash flows derived there from, will vary from the evaluation and such variations could be material. The present value of estimated future net cash flows referred to herein should not be construed as the current market value of estimated heavy oil reserves attributable to the Company's properties. Estimates of future net revenue do not represent fair market value.

The foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking information contained in this news release is made as of the date hereof and Santa Maria undertakes no obligation 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.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Contact Information

  • Santa Maria Petroleum Inc.
    Ron MacMicken
    President & Chief Executive Officer
    (416) 902-8099
    ron@quetzalenergy.com