Seaview Energy Inc.
TSX VENTURE : CVU.A
TSX VENTURE : CVU.B

Seaview Energy Inc.

April 02, 2009 12:01 ET

Seaview Energy Inc. Announces Reserves Evaluation as at December 31, 2008, Operations Update and Expanded Credit Facility

CALGARY, ALBERTA--(Marketwire - April 2, 2009) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAWS.

Seaview Energy Inc. (TSX VENTURE:CVU.A) (TSX VENTURE:CVU.B) ("Seaview" or the "Company") is pleased to provide shareholders with an update of the Company's reserves as at year-end, credit facility increase and corporate activities.

Since incorporating in October 2007, Seaview has achieved significant early success with executing its balanced strategy of acquiring, exploiting and exploring for high quality natural gas and light oil assets in Western Canada. As at December 31, 2008, Seaview's accomplishments are as follows:


- Increased Total Proven reserves by 344% per share to 4,786 MBoe, a 1064% relative increase since year end 2007.

- Increased Total Proven plus Probable reserves by 289% per share to 7,256 MBoe, a 921% relative increase since year end 2007.

- Achieved FD&A costs of $24.01/boe Proven and $17.94/boe Proven plus Probable (including changes to Future Development Costs "FDC").

- Achieved F&D costs of $15.98/boe Proven and $13.46/boe Proven plus Probable (including changes to FDC).

- Achieved Q4-2008 average production of 1,794 boe/d based on an unaudited internal estimate, representing an increase of 367% per share as compared to Q4-2007 average production of 151 boe/d.

- Expanded the credit facility to $44 million representing a 30% increase relative to June 30, 2008. Based on year end 2008 net debt of $19.4 million, Seaview has $24.6 million of available credit capacity to pursue additional strategic opportunities.

Business Strategy

For the year ending December 31, 2008, Seaview has achieved significant reserves and production growth per share as a result of successful execution of its business plan. Despite volatile commodity prices and the impact of the global financial crisis on capital markets, Seaview is well positioned to continue executing its aggressive growth strategy.

Through a disciplined approach to capital management, Seaview has several key characteristics that support continued growth and value creation for shareholders despite the current economic climate:

- High-quality, long reserve life assets, focused on natural gas in the Peace River Arch and light oil in southeast Saskatchewan, both desirable areas within the Western Canadian Sedimentary Basin.

- Strong financial position including; a low cost structure, strong balance sheet and $24.6 million of available credit facility providing Seaview with the ability to capitalize on strategic opportunities.

- Attractive commodity risk management program to provide an enhanced cash flow stream in order to maintain balance sheet strength, secure acquisition economics and finance the Company's capital expenditures.

- Strong management team, directors and technical professionals with significant ownership positions, ensuring strong alignment to shareholder's interests.

Highlights of 2008

Seaview successfully executed its business plan through the closing of three strategic acquisitions and a very successful drilling program where the Company drilled a total of 18 gross wells (9.1 net) in 2008 with an 89% success rate. Seaview's management team has positioned the Company for solid future growth per share through the successful execution of the Company's business strategy.

Certain financial estimates have been made herein to facilitate discussion of the Company's 2008 capital program. Readers are advised that these financial estimates are subject to the disclosure to be contained in the audited financial statements of Seaview for the year ended December 31, 2008, management's discussion and analysis related thereto and its Annual Information Form expected to be filed on or about April 7, 2009.

The Company is pleased to report that a significant increase in reserves during 2008 as a result of three strategic acquisitions and a successful 2008 drilling program. The independent reserves evaluation has been completed by Sproule and Associates Limited "Sproule" with an effective date of December 31, 2008, in a National Instrument 51-101 "NI 51-101" compliant report "Evaluation of the P&NG Reserves of Seaview Energy Inc." Highlights of the report are summarized below:


- Proven Developed Producing reserves have increased by 358% per share to 3,941 MBoe, a relative increase of 1,096% since December 31, 2007.

- Total Proven reserves have increased by 344% per share to 4,786 MBoe, a relative increase of 1,064% since December 31, 2007.

- Total Proven plus Probable reserves increased by 289% per share, to 7,256 MBoe, a relative increase of 921% since December 31, 2007

- Achieved Q4-2008 average production of 1,794 boe/d based on an unaudited internal estimate, representing an increase of 367% per share as compared to Q4-2007 average production of 151 boe/d.

- Reserve Life Index of 7.3 years on a Total Proven basis and 11.1 years on a Total Proven plus Probable basis using December 31, 2008 reserves, and estimated Q4-08 production of 1,794 boe/d.

- Total capital expenditures based on unaudited financial results were $115.3 million, including changes in FDC total capital costs for the purpose of calculating FD&A costs are $126.2 million.

-- Achieved FD&A costs of $24.01/boe Proven and $17.94/boe Proven plus Probable (Including FDC).

-- Seaview completed three strategic acquisitions in 2008 adding 4,753 mBoe of Total Proven plus Probable reserves, or 64% of the Total Proven plus Probable reserve additions in 2008.

-- Seaview's acquisitions and drilling success replaced production by 11.3 times on a Proven basis and 16.3 times on a Proven plus Probable basis.

- Seaview completed an active drilling program in 2008 which included drilling 18 gross wells (9.1 net) with an 89% success rate. Capital expenditures based on unaudited consolidated financial results were $24.1 million directed towards drilling activity. Including changes to FDC, the total capital costs for the purpose of calculating F&D costs are $35.6 million.

-- Achieved F&D costs of $15.98/boe Proven and $13.46/boe Proven plus Probable (including FDC).

-- Seaview enjoyed a very successful drilling program accounting for 2,475 mBoe or 36% of the Total Proven and Probable reserve additions in 2008.

-- Seaview's drilling success replaced production by 3.6 times on a Proven basis and 6.1 times on a Proven plus Probable basis.

Net asset is calculated to be $2.19 per Class A share, using Total Proven plus Probable reserves value discounted at 10%, an increase of 75% relative to December 31, 2007.

Reserves

Seaview has a Reserve Committee comprised of independent board members, which reviews the qualifications and appointment of the independent reserve evaluators. The committee also reviews the processes and technical data used to determine the reserves booked.

The Company will file on April 7, 2009 its Annual Information Form which includes Seaview's reserves data and other oil and gas information for the year ended December 31, 2008 as mandated by "NI 51-101 - Standards for Disclosure for Oil and Gas Activities of the Canadian Securities Administrators."

The December 31, 2008, evaluation was prepared by Sproule utilizing the methodology and definitions as set out under NI 51-101. The reserves presented herein include the total Company's working interest reserves before deduction of royalties and exclude royalty interest reserves as at December 31, 2008.



Table 1 NI 51-101

Summary of Oil and Gas Reserves
as of December 31, 2008
Forecast Prices and Costs

Gross Reserves Net Reserves
------------------------------------------------------------------
Light
and Light and
Medium Natural Medium Natural
Crude Heavy Gas Natural Crude Heavy Gas Natural
Oil Crude Liquids Gas Oil Crude Liquids Gas
------------------------------------------------------------------
Mbbls Mbbls Mbbls Mmcf Mbbls Mbbls Mbbls Mmcf
------------------------------------------------------------------

Proved
Developed
Producing 1107.0 0 50.5 16,702 968.4 0 31.3 12,134
Developed
Non-
Producing 51.9 0 1.9 3,409 48.8 0 1.2 2,428
Undeveloped 24.4 0 3.7 1,167 17.9 0 2.2 975
Total
Proved 1183.3 0 56.1 21,278 1035.1 0 34.7 15,537
Probable 503.5 0 39.2 11,567 431.4 0 25.2 8,259
Total Proved
plus
Probable 1686.9 0 95.3 32,845 1466.5 0 59.9 23,796


Table 2 NI 51-101

Summary of Net Present Values of Future Net Revenue
as of December 31, 2008
Forecast Prices and Costs


Unit Value Before
Before Future Income Tax Income Tax
Expenses and Discounted at Discounted at
--------------------------------------------------------------
0% 5% 10% 15% 20% 10%/yr
--------------------------------------------------------------
(M$) (M$) (M$) (M$) (M$) ($/boe)
--------------------------------------------------------------

Proved
Developed
Producing 142,071 99,062 77,390 64,350 55,581 25.61
Developed
Non-Producing 20,811 15,546 12,344 10,316 8,886 27.15

Undeveloped 4,998 2,568 1,312 583 126 7.18
Total Proved 167,881 117,086 91,045 75,249 64,594 24.88
Probable 92,267 50,390 33,680 24,809 19,298 18.37
Total Proved
plus Probable 260,147 167,476 124,725 100,058 83,892 22.71


After Future Income Tax Expenses and Discounted at
----------------------------------------------------
0% 5% 10% 15% 20%
----------------------------------------------------
(M$) (M$) (M$) (M$) (M$)
----------------------------------------------------

Proved
Developed Producing 117,165 83,416 66,096 55,539 48,371
Developed Non-Producing 15,278 11,274 8,946 7,429 6,359
Undeveloped 3,740 1,811 804 216 -151
Total Proved 136,184 96,501 75,845 63,184 54,580
Probable 67,907 36,922 24,427 17,760 13,609
Total Proved plus Probable 204,091 133,424 100,272 80,944 68,189


Table 3 NI 51-101

Total Future Net Revenue Undiscounted
as of December 31, 2008
Forecast Prices and Costs

Operating Development
Revenue Royalties Costs Costs
---------------------------------------------
(M$) (M$) (M$) (M$)
---------------------------------------------
Total Proved
Reserves 329,371 62,522 87,036 5,219
Total Proved plus
Probable 519,760 101,481 136,245 12,982


Future Net
Revenue
Abandonment and Before Future Net
Reclamation Income Income Revenue After
Costs Taxes Taxes Income Taxes
-----------------------------------------------------
(M$) (M$) (M$) (M$)
-----------------------------------------------------
Total Proved
Reserves 6,707 167,881 31,697 136,184
Total Proved plus
Probable 8,896 260,147 56,057 204,091


Table 4 NI 51-101

Net Present Value of Future Net Revenue
By Production Group
as of December 31, 2008
Forecast Prices and Costs

Future Net Revenue Unit Value Before
Before Income Taxes and Income Taxes
(Discounted at 10%/Year) (Discounted at 10%/Year)
----------------------------------------------------
(M$) ($/boe)
----------------------------------------------------

Proved
Light and Medium Crude Oil
(including solution gas
and associated by-products) 25,852 23.82
Heavy Crude Oil
(including solution gas
and associated by-products) 0 0
Natural Gas
(including associated by
products) 65,194 25.33
Proved plus Probable
Light and Medium Crude Oil
(including solution gas and
associated by-products) 34,405 22.29
Heavy Crude Oil
(including solution gas and
associated by-products) 0 0
Natural Gas
(including associated by products) 90,320 22.87


Table 5 NI 51-101

Summary of Pricing and Inflation Rate Assumptions
As of December 31, 2008 Forecast Prices and Costs

NATURAL
CRUDE OIL GAS
-------------------------------------------------------------
Edmonton Cromer
WTI Par Price Medium Alberta
Crude 40 degrees 29.3 degrees AECO Gas
Year Oil API Crude Oil API Crude Oil Price
-------------------------------------------------------------
($US/Bbl) ($Cdn/Bbl) ($Cdn/Bbl) ($Cdn/mmbtu)
-------------------------------------------------------------
(1) (2) (3)
------------------------------------------------
Forecast
2009 53.72 65.35 58.16 6.82
2010 63.41 72.78 66.23 7.56
2011 69.53 79.95 72.76 7.84
2012 79.59 86.57 79.65 8.38
2013 92.01 94.97 87.38 9.20

Thereafter Various Escalation Rates


NATURAL GAS LIQUIDS
-------------------------------------------------------------
Pentanes Butanes
Plus FOB US/CAN
FOB Field Field Exchange
Year Gate Gate Inflation Rate
-------------------------------------------------------------
($Cdn/Bbl) ($Cdn/Bbl) (%) ($US/Cdn)
-------------------------------------------------------------
Forecast
2009 66.93 51.15 2.0 0.800
2010 74.54 54.25 2.0 0.850
2011 81.88 59.59 2.0 0.850
2012 88.66 64.53 2.0 0.900
2013 97.27 70.79 2.0 0.950

Thereafter Various Escalation Rates

Notes:

(1) West Texas Intermediate at Cushing Oklahoma 40 degrees API, 0.5%
sulphur

(2) Edmonton Light Sweet 40 degrees API, 0.3% sulphur

(3) Comer Medium (29.3æ degrees API Heavy stream)


Net Asset Value per Share Information
Based on Sproule Reserves Evaluation as at December 31, 2008

----------------------------------------------------------------------------
Before Tax 10% Discount
----------------------------------------------------------------------------
($M except share amounts) Proven Total
Developed Proven Total Proven
Producing Reserves plus Probable
----------------------------------------------------------------------------
Value of Reserves 77,390 91,045 124,725
Undeveloped Land (22,000
acres at $200 per acre) 4,400 4,400 4,400
Estimated Net Debt as at
December 31, 2008 (19,418) (19,418) (19,418)
----------------------------------------------------------------------------
Total Net Assets 62,372 76,027 109,707

Class A shares Outstanding
(MM) as at December 31, 2008 50.00 50.00 50.00
Estimated Net Asset Value per
Class A share $1.25 $1.52 $2.19
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Before Tax 15% Discount
----------------------------------------------------------------------------
($M except share amounts) Proven Total
Developed Proven Total Proven
Producing Reserves plus Probable
----------------------------------------------------------------------------
Value of Reserves 64,350 75,249 100,058
Undeveloped Land (22,000
acres at $200 per acre) 4,400 4,400 4,400
Estimated Net Debt as at
December 31, 2008 (19,418) (19,418) (19,418)
----------------------------------------------------------------------------
Total Net Assets 49,332 60,231 85,040

Class A shares Outstanding
(MM) as at December 31, 2008 50.00 50.00 50.00
Estimated Net Asset Value per
Class A share $0.99 $1.20 $1.70
----------------------------------------------------------------------------


INCREASED CREDIT FACILITY

As a result of the significant increase in reserves and production during 2008, Seaview has executed a renewed lending facility with its banker. The new facility reflects a 30% increase to the Company's previous credit facility of $34 million. The new facility of $44 million affords the Company with expanded flexibility in pursuing additional strategic opportunities, with $24.6 million of available credit capacity relative to unaudited net debt of $19.4 million as of December 31, 2008.

COMMODITY PRICE RISK MANAGMENT

A key component to Seaview's balance sheet management is the Company's commodity price risk strategy. Seaview's risk management program is intended to reduce price volatility in order to maintain balance sheet strength, protect acquisition economics and finance ongoing capital expenditures.

- Seaview currently has approximately 810 boe/d (45% of estimated Q4-2008 production) hedged for calendar 2009.

-- 4500 GJ/d of natural gas hedged in put and fixed contracts providing for a "net of cost" floor of $8.05 CDN per GJ which is a 89% premium to the current calendar AECO 2009 futures strip of $4.26 CDN per GJ.

-- 100 bbl/d of crude oil hedged in a fixed contract at $55.90 CDN per barrel.

- Current hedging program provides minimum gross revenue of $14.5 million for 2009 for the hedged volumes.

- As at March 31, 2009, the estimated market-to-market value of Seaview's derivatives contracts was $3.5 million.

RELEASE OF 2008 FINANCIALS AND ANNUAL INFORMATION FORM

Seaview intends to file its financial results for the year ended December 31, 2008 including the audited consolidated financial statements and related management's discussion and analysis ("MD&A") on or about April 7, 2009.

Additionally on April 7, 2009, the Company will file its Annual Information Form which includes Seaview's reserves data and other oil and gas information for the year ended December 31, 2008 as mandated by National Instrument 51-101 Standards for Disclosure for Oil and Gas Activities of the Canadian Securities Administrators. These filings will be available in their entirety at www.seaviewenergy.com and www.sedar.com or by contacting the Company directly on or after April 7, 2009.

Barrels of oil equivalent (boe) may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet (mcf) of natural gas to one barrel (bbl) of oil is based on an energy conversion method primarily applicable at the burner tip and is not intended to represent a value equivalency at the wellhead. All boe conversions in this press release are derived by converting natural gas to oil in the ratio of six thousand cubic feet of natural gas to one barrel of oil. Certain financial amounts are presented on a per boe basis, such measurements may not be consistent with those used by other companies.

Estimated values disclosed in this press release do not represent fair market value.

This press release may contain forward-looking statements within the meaning of applicable securities laws. Forward-looking statements may include estimates, plans, anticipations, expectations, opinions, forecasts, projections, guidance or other similar statements that are not statements of fact. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. These risks include, but are not limited to: the risks associated with the oil and gas industry (e.g. operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses and health, safety and environmental risks), commodity price and exchange rate fluctuation and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligations 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 the term is defined in the Policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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