HOUSTON, TEXAS--(Marketwired - Dec. 2, 2014) - Caza Oil & Gas, Inc. ("Caza" or the "Company") (TSX:CAZ)(AIM:CAZA) is pleased to announce an increase in the value of PDP and Proved reserves in the current year as a result of its successful development drilling program in the Bone Spring Play since April 30, 2013.
Total Net Reserves (see comparison tables below): In the Company's latest reserves report as at September 30, 2014 (the "Reserves Report"), prepared by Netherland Sewell & Associates, Inc., proved developed producing ("PDP") reserves increased 37.3% to 1,893.6 Mboe and total proved ("1P") reserves decreased slightly to 4,483.4 Mboe from April 30, 2014. The Company's proved plus probable ("2P") reserves also decreased by approximately 13.8% from April 30, 2014. These decreases are due mostly to the sale of the Company's historical Wharton County, Texas production and lower commodity pricing. According to the Reserves Report, the Company's PDP value increased by approximately 32%, and despite the decrease to 1P reserves, the Company's 1P value increased by 8.8% from April 30, 2014, due to a higher percentage of oil/liquids production.
Net Bone Spring Reserves: The Company currently has 28 gross (8.82 net) wells producing from the Bone Spring formation. The Company's Bone Spring properties have been assigned approximately 4,448.5 Mboe of proved reserves in the Reserves Report (4,215.2 Mboe as at April 30, 2014) representing an increase of 5.5% in the reserves attributed to these properties. The Reserves Report has also assigned approximately 16,722.6 Mboe of 2P reserves and approximately 33,486.1 Mboe of 3P reserves to these properties (17,207.8 Mboe of 2P reserves and approximately 34,269.4 Mboe of 3P reserves as at April 30, 2014).
The following tables describe the Company's net reserves and associated net present values from April 30, 2014 to September 30, 2014.
Total Net Reserve Volumes:
---------------------------------------------------------------------------- April 30, 2014 September 30, 2014 ---------------------------------------------------------------------------- Oil and Natural Oil and Natural NGL Gas NGL Gas (Mbbl) (MMcf) Mboe (Mbbl) (MMcf) Mboe ---------------------------------------------------------------------------- Proved Developed Producing 1,105.5 1,641.4 1,379.1 1,534.0 2,157.7 1,893.6 ---------------------------------------------------------------------------- Developed Non- Producing 38.9 255.7 81.5 134.0 88.7 148.8 ---------------------------------------------------------------------------- Undeveloped 2,426.0 5,935.2 3,415.2 1,936.5 3,027.4 2,441.0 ---------------------------------------------------------------------------- Total Proved 3,570.4 7,832.3 4,875.8 3,604.4 5,273.7 4,483.4 ---------------------------------------------------------------------------- Probable 10,290.4 25,228.6 14,495.2 9,012.2 21,140.8 12,535.7 ---------------------------------------------------------------------------- Total Proved + Probable 13,860.8 33,060.9 19,371.0 12,616.6 26,414.5 17,019.1 ---------------------------------------------------------------------------- Possible 12,784.0 36,531.4 18,872.5 11,857.6 29,435.2 16,763.5 ---------------------------------------------------------------------------- Total Proved + Probable + Possible 26,644.8 69,592.2 38,243.5 24,474.3 55,849.8 33,782.5 ----------------------------------------------------------------------------
Net Present Values of Future Net Revenue:
---------------------------------------------------------------------------- April 30, 2014 September 30, 2014 (US$000) (US$000) ---------------------------------------------------------------------------- Proved Developed Producing 48,449.2 63,936.3 ---------------------------------------------------------------------------- Developed Non-Producing 1,657 4,530.6 ---------------------------------------------------------------------------- Undeveloped 43,938.5 33,863.3 ---------------------------------------------------------------------------- Total Proved 94,044.6 102,330.2 ---------------------------------------------------------------------------- Probable 139,381.5 89,068.8 ---------------------------------------------------------------------------- Total Proved + Probable 233,426.1 191,398.9 ---------------------------------------------------------------------------- Possible 87,554.4 43,148.8 ---------------------------------------------------------------------------- Total Proved + Probable + Possible 320,980.5 234,547.7 ---------------------------------------------------------------------------- Notes: 1. Before income taxes, discounted at 10%. 2. September 30, 2014 figures are based on forecast pricing as at August 30, 2014; April 30, 2014 figures are based on forecast pricing as at December 31, 2013. 3. The estimates of future net revenue disclosed herein do not represent fair market value.
Mike Ford, Chief Executive Officer of the Company, will present at the 69th Oilbarrel Conference in London on December 2, 2014. A copy of the presentation will be available on the Company's website shortly after the conclusion of the conference at www.cazapetro.com.
W. Michael Ford, Chief Executive Officer commented:
"We are pleased to provide these updated reserve figures. The increased value to PDP and Proved reserves is the result of our successful development drilling program in the Bone Spring play resulting in high oil/liquids production. During this drilling campaign we have drilled or participated in 26 consecutive successful wells. As we continue to drill development wells in the play, we anticipate our PDP and 1P reserves will continue to increase as we prove up probable and possible reserves from the 2P and 3P categories.
The Company operated Igloo 19 #2H and Lennox 32 #4H wells along with the non-operated Marathon Road 15 OB #1H well are scheduled for fracture stimulation over the next two weeks. We look forward to updating the market once flow rates have stabilized."
About Caza
Caza is engaged in the acquisition, exploration, development and production of hydrocarbons in the following regions of the United States of America through its subsidiary, Caza Petroleum, Inc.: Permian Basin (West Texas and Southeast New Mexico) and Texas and Louisiana Gulf Coast (on-shore).
The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.
In accordance with AIM Rules - Guidance Note for Mining, Oil and Gas Companies, the information contained in this announcement has been reviewed and approved by Anthony B. Sam, Vice President Operations of Caza who is a Petroleum Engineer and a member of The Society of Petroleum Engineers.
Note on Reserves Data:
The reserves data set out herein have been extracted from the Reserves Report and are presented on a net basis. The evaluation of the reserves data included in the Reserves Report complies with standards set out in the Canadian Oil and Gas Evaluation Handbook prepared jointly by the Society of Petroleum Evaluation Engineers (Calgary Chapter) and the Canadian Institute of Mining, Metallurgy & Petroleum (Petroleum Society).
Totals may not add because of rounding. Mbbl, MMcf and Mboe refer to thousand barrels, million cubic feet and thousand barrels of oil equivalent, respectively.
The term boe may be misleading, particularly if used in isolation. A boe conversion of six thousand cubic feet per one barrel is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the well head. Given that the value ratio based on the current price of oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.
Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible reserves.