Strata Oil & Gas Inc.
OTCQB : SOIGF
OTCBB : SOIGF

August 08, 2013 08:30 ET

Strata Oil Reaches 887 Million Recoverable Barrels

CALGARY, ALBERTA--(Marketwired - Aug. 8, 2013) - Strata Oil & Gas Inc. ("Strata" or the "Company") (OTCQB:SOIGF)(OTCBB:SOIGF), announced at the end of May 2013 the completion of its 51-101 compliant Technical Resource Evaluation of the 22 sections (approximately 14,080 acres) of its 100%-owned Cadotte West holdings in the Peace River oil sands. This resource evaluation added 1.4 billion barrels of Petroleum-Initially-In-Place (PIIP as per COGE Handbook definition) to Strata's present resource base, bringing it to a total of 3.4 billion barrels in place. This in turn brought the recoverable portion of Strata's resource to 887 million barrels (bbls).

The 3.4 billion bbls of PIIP indicate the total barrels of crude estimated to be held within Strata's Cadotte Central and West project. This number was calculated using such factors as the ore zone thickness, porosity, and oil saturation. The 887 million barrel recoverable resource represents the amount of bitumen within the project that is technologically or economically feasible to extract.

The Cadotte Central project is estimated to have a Net Present Value (NPV) of USD $1.3 billion (over initial 20 years, producing only 360 million bbls of the original 517 million bbls available). This still leaves 157 million bbls past the initial 20 years. However, our newly revised combined total of 887 bbls of recoverable bitumen presents new and additional upside potential:

  1. The NPV of USD $1.3 billion is based on recovering only 360 million bbls, and does not reflect the additional 527 million recoverable barrels which have now been calculated.
  2. These 360 million bbls only represent 41% of the total recoverable bitumen from Strata's Cadotte project.
  3. Our estimate of NPV $1.3 Billion to this point has been calculated utilizing conservative oil price forecasts. However, oil prices are now hovering around the $105/barrel mark and are forecast to remain strong. Higher oil prices would mean a potential increase to Strata's NPV from the previously more conservative best and high case scenarios.
  4. The recovery rate for Strata's project is currently estimated at 26%. However, other carbonate producers in the Peace River oil sands are estimating higher rates. For example, Baytex's developing thermal extraction method estimates a probable recovery rate of 30%. Even small improvements in recovery can significantly enhance project economics. These numbers are improving as new and more advanced methods of extraction are being developed.
  5. Strata's now increased resource base makes the project even more attractive to prospective partners which are focused on world-class production metrics in geopolitically stable regions with excellent infrastructure and distribution.

"With crude oil prices remaining solid and the present year's forecast of $121 per barrel, Strata's prospects are excellent. In addition, more cost effective and efficient methods of extraction from the carbonates are being developed and implemented. Investors have good reason to expect continued appreciation in Strata's value as we move forward with pre-production development", says President and CEO of Strata Oil & Gas, Ron Daems.

About Strata Oil & Gas

Strata Oil & Gas is a US-publicly traded company focused on the exploration and development of heavy oil from carbonates. The company currently holds a 100% interest in 52,480 acres of oil sands leases in the Peace River region of Alberta's Carbonate Triangle. Strata's Cadotte project has been independently evaluated, with a resource base of 3.44 billion bbls in-place and 887 million bbls recoverable. Strata's existing world-class Cadotte Central project of 56,000 barrels-per-day over 20 years is valued at NPV $1.3 billion. For more information, go to the company's website at www.strataoil.com.

Strata Oil and Strata Oil & Gas are trademarks of Strata Oil & Gas Inc. This announcement contains forward-looking statements which involve risks and uncertainties that include, among others, limited operating history, risks related to petroleum exploration, limited access to operating capital, and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. All statements made herein concerning the foregoing are qualified in their entirety by reference to the following Norwest Reports: Evaluation of Bitumen Resources Cadotte Leases (2013), Resource Reclassification (2010), Bitumen Hosted Carbonate Pilot Projects (2008), Preliminary Feasibility Study (2008), Evaluation of Bitumen Resources Cadotte Leases (2007), which have been filed with the SEC. More information is included in Strata's filings with the Securities and Exchange Commission which may be accessed through the SEC's web site at www.sec.gov.

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