Traverse Energy Ltd.
TSX VENTURE : TVL

Traverse Energy Ltd.

March 13, 2015 17:29 ET

Traverse Energy Announces 2014 Year End Reserves

CALGARY, ALBERTA--(Marketwired - March 13, 2015) - Traverse Energy Ltd. ("Traverse" or "the Company") (TSX VENTURE:TVL) presents its 2014 year-end reserves. Traverse's independent reserve report was prepared by Sproule Associates Ltd. ("Sproule") in accordance with National Instrument 51-101 with an effective date of December 31, 2014.

Highlights

The Company share proved reserves increased from the prior year report by 28% from 1,447.2 MBOE (thousand barrels of oil equivalent) to 1,850.2 MBOE.

  • Company share proved plus probable reserves of 2,577.7 MBOE - 35% year over year growth
  • Company share proved developed producing reserves represent 63% of total proved reserves
  • Company share proved reserves constitute 72% of total proved plus probable reserves
  • Net present value of future net revenue attributable to the reserves (before tax) discounted at 10% is $38.2 million for the proved reserves and $51.6 million for the proved plus probable reserves
  • Undiscounted total future development capital for the proved plus probable reserves is $4.8 million
  • Company share proved plus probable reserves are comprised of 54% oil and natural gas liquids and 46% natural gas

Summary of oil and gas reserves - forecast prices (1)

Oil and NGL Natural Gas Oil Equivalent Oil Equivalent

Reserve Category
Gross(2)
(Mbbl)
Net(3)
(Mbbl)
Gross(2)
(MMcf)
Net(3)
(MMcf)
Gross(2)
(MBOE)
Net(3)
(MBOE)
Company Share(4)
(MBOE)
Proved Developed Producing 560.8 575.8 2,323 2,715 947.9 1,028.3 1,171.6
Proved Developed Non-producing 39.3 33.2 1,012 905 207.9 183.9 207.9
Proved Undeveloped 188.0 287.0 - 969 188.0 448.4 470.7
Total Proved 788.1 896.0 3,334 4,589 1,343.8 1,660.6 1850.2
Probable 329.6 332.2 1,481 1,700 576.5 615.6 727.5
Total Proved plus Probable 1,117.7 1,228.2 4,816 6,289 1,920.4 2,276.3 2577.7
Notes:
1. Based on the Sproule price forecast effective December 31, 2014.
2. Gross reserves are Traverse's working interest share before deduction of royalties and without including any over-riding royalty interest of Traverse.
3. Net reserves are Traverse's working interest share after deduction of royalty obligations, plus Traverse's over-riding royalty interest in reserves.
4. Company share reserves are Traverse's working interest share before deduction of royalties plus Traverse's over-riding royalty interest in reserves.
5. Columns may not add due to rounding.

Summary of net present value of future net revenue as of December 31, 2014

Value Before Income Taxes Discounted at (%/Year) (1)(2)
Reserve Category 0
(M$)
5
(M$)
10
(M$)
15
(M$)
20
(M$)
Proved Developed Producing 42,394 32,511 26,830 23,131 20,510
Proved Developed Non-producing 2,448 2,143 1,894 1,686 1,513
Proved Undeveloped (2) 21,536 13,623 9,493 6,998 5,339
Total Proved 66,378 48,277 38,217 31,815 27,361
Probable 30,461 18,605 13,420 10,519 8,643
Total Proved plus Probable 96,839 66,882 51,638 42,334 36,003

Summary of net present value of future net revenue as of December 31, 2014 (continued)

Value After Income Taxes Discounted at (%/Year) (1)(2)
Reserve Category 0
(M$)
5
(M$)
10
(M$)
15
(M$)
20
(M$)
Proved Developed Producing 39,233 30,768 25,757 22,417 20,008
Proved Developed Non-producing 1,836 1,598 1,405 1,247 1,116
Proved Undeveloped 16,174 10,123 6,957 5,038 3,761
Total Proved 57,243 42,489 34,119 28,703 24,886
Probable 22,827 13,963 10,087 7,920 6,521
Total Proved plus Probable 80,070 56,452 44,206 36,623 31,407
Notes:
1. Based on the Sproule price forecast effective December 31, 2014.
2. Includes future development capital of $4.8 million (undiscounted).
3. Columns may not add due to rounding.

Reserve reconciliations

The following tables reconcile Traverse's gross reserves by principal product type. Gross reserves are Traverse's working interest (operated or non-operated) share of reserves before deduction of royalty obligations and without including any over-riding royalty ("ORR") interests of Traverse:

Gross Reserves Light and Medium Oil Natural Gas
WI P WI PA WI P+PA WI P WI PA WI P+PA
Mbbl Mbbl Mbbl MMcf MMcf MMcf
December 31, 2013 553.0 157.3 710.3 2,898 904 3,802
Extensions 24.3 8.0 32.3 303 145 448
Discoveries 0.0 0.0 0.0 471 172 643
Technical revisions (175.0 ) (51.2 ) (226.2 ) 173 164 335
Dispositions 0.0 0.0 0.0 (76 ) (19 ) (95 )
Infill 495.2 193.7 688.8 404 116 520
Economic factors (2.2 ) 0.8 (1.4 ) (11 ) 0 (10 )
Production (152.8 ) 0.0 (152.8 ) (826 ) 0 (826 )
December 31, 2014 742.4 308.6 1,051.0 3,334 1,482 4,816
Gross Reserves (continued) Natural Gas Liquids BOE
WI P WI PA WI P+PA WI P WI PA WI P+PA
Mbbl Mbbl Mbbl MBOE MBOE MBOE
December 31, 2013 37.5 11.6 49.1 1,073.5 319.6 1,393.1
Extensions 7.3 3.3 10.3 81.8 35.5 117.3
Discoveries 7.2 3.2 10.5 85.7 31.9 117.6
Technical revisions (0.2 ) 1.1 0.9 (146.8 ) (22.8 ) (169.5 )
Dispositions (3.4 ) (0.8 ) (4.2 ) (16.1 ) (4.0 ) (20.1 )
Infill 9.3 2.7 11.9 571.8 215.6 787.4
Economic factors (0.1 ) 0.0 (0.1 ) (4.1 ) 0.8 (3.3 )
Production (11.6 ) 0.0 (11.6 ) (302.1 ) 0.0 (302.1 )
December 31, 2014 45.7 21.0 66.7 1,343.8 576.5 1,920.4

The following tables reconcile Traverse's net over-riding royalty interest reserves by principal product type:

Royalty Interest Reserves Light and Medium Oil Natural Gas
Net P Net PA Net P+PA Net P Net PA Net P+PA
Mbbl Mbbl Mbbl MMcf MMcf MMcf
December 31, 2013 123.1 38.1 161.2 1,240 523 1,763
Infill drilling 67.5 21.3 88.8 759 204 963
Technical revisions (42.5 ) (15.5 ) (58.0 ) (40 ) (212 ) (252 )
Economic factors (0.5 ) 0.0 (0.5 ) (7 ) 1 (5.4 )
Production (12.0 ) 0.0 (12.0 ) (163 ) 0 (163 )
December 31, 2014 135.6 43.9 179.5 1,789 5,816 2,305
Royalty Interest Reserves (continued) Natural Gas Liquids BOE
Net P Net PA Net P+PA Net P Net PA Net P+PA
Mbbl Mbbl Mbbl MBOE MBOE MBOE
December 31, 2013 44.0 18.3 62.3 373.7 143.6 517.3
Infill drilling 31.8 8.5 40.3 225.7 63.8 289.6
Technical revisions 3.6 (5.9 ) (2.3 ) (45.5 ) (56.7 ) (102.2 )
Economic factors (0.3 ) 0.0 (0.2 ) (1.8 ) 0.2 (1.6 )
Production (6.4 ) 0.0 (6.4 ) (45.6 ) 0.0 (45.6 )
December 31, 2014 72.6 21.0 93.6 506 151 657

The following tables reconcile Traverse's company share reserves which include working interest reserves, before royalty payable, and royalty interest reserves:

Company Share Reserves Light and Medium Oil Natural Gas
Net P Net PA Net P+PA Net P Net PA Net P+PA
Mbbl Mbbl Mbbl MMcf MMcf MMcf
December 31, 2013 676.1 195.4 871.5 4,138 1,427 5,565
Extensions 24.3 8.0 32.3 303 145 448
Infill drilling 562.7 215.0 777.6 1,163 319 1,482
Discoveries 0.0 0.0 0.0 471 172 643
Dispositions 0.0 0.0 0.0 (76 ) (19 ) (95 )
Technical revisions (217.5 ) (66.7 ) (284.2 ) 131 (48 ) 83
Economic factors (2.7 ) 0.8 (1.9 ) (17 ) 1 (16 )
Production (164.8 ) 0.0 (164.8 ) (989 ) 0 (989 )
December 31, 2014 878.1 352.5 1,230.5 5,123 1,998 7,121
Company Share Reserves (continued) Natural Gas Liquids BOE
Net P Net PA Net P+PA Net P Net PA Net P+PA
Mbbl Mbbl Mbbl MBOE MBOE MBOE
December 31, 2013 81.5 29.9 111.4 1,447.2 463.2 1,910.4
Extensions 7.0 3.3 10.3 81.8 35.5 117.3
Infill drilling 41.1 11.2 52.2 797.5 279.4 1,077.0
Discoveries 7.2 3.2 10.5 85.7 31.9 117.6
Dispositions (3.4 ) (0.8 ) (4.2 ) (16.1 ) (4.0 ) (20.1 )
Technical revisions 3.3 (4.8 ) (1.6 ) (192.3 ) (79.5 ) (271.9 )
Economic factors (0.4 ) 0.1 (0.3 ) (5.9 ) 1.0 (4.9 )
Production (18.1 ) 0.0 (18.1 ) (347.7 ) 0.0 (347.7 )
December 31, 2014 118.3 42.1 160.4 1,850.2 727.5 2,577.7
Notes:
1. Columns may not add due to rounding.

BOE equivalent

Unless otherwise stated, the volume conversion of natural gas to barrel of oil equivalent (BOE) is presented on the basis of 6 thousand cubic feet of natural gas being equal to 1 barrel of oil. This conversion ratio is based upon an energy equivalent conversion method primarily applicable at the burner tip and does not represent value equivalence at the wellhead. BOE figures may be misleading, particularly if used in isolation.

Forward-looking information

This news release contains forward-looking information which is not comprised of historical fact. Forward-looking information involves risks, uncertainties and other factors that could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward-looking information in this news release includes: the volumes of reserves attributable to the Company's assets and the estimate of the net present value of the future net revenue attributable thereto. This forward looking information is subject to a variety of substantial known and unknown risks and uncertainties and other factors that could cause actual events or outcomes to differ materially from those anticipated or implied by such forward looking information. The Company's Annual Information Form filed on April 15, 2014 with securities regulatory authorities (accessible through the SEDAR website www.sedar.com) describes the risks, material assumptions and other factors that could influence actual results and which are incorporated herein by reference.

Although the Company believes that the material assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur. The Company disclaims any intention or obligation to update or review any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.

The Company's 2014 year end audited financial statements, the related management's discussion and analysis and Annual Information Form are expected to be filed on or about April 15, 2015.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accept responsibility for the adequacy or accuracy of the content of this release.

Contact Information

  • Traverse Energy Ltd.
    Laurie Smith
    President and CEO