03 Apr 2020 08:02 ET
Newsfile Corp Buenos Aires, Argentina--(Newsfile Corp. - April 3, 2020) - Centaurus Energy Inc. (TSXV: CTA) (OTCQX: CTARF) ("Centaurus" or the "Company") is pleased to announce the results of its annual independent reserves assessment as at December 31, 2019. All dollar amounts are in United States dollars and all reserves and production volumes are on a working interest before royalties ("WI") basis and are expressed in barrels ("bbl") of oil equivalent ("boe"), unless otherwise indicated. Centaurus' Interim CEO David Tawil commented: "In 2019, Centaurus grew its reserves across all reserves categories, largely thanks to a successful initial pilot development plan being put in place for the Vaca Muerta shale on the Coiron Amargo Sur Este (CASE) block. We are excited to have generated this substantial reserves growth with the activity levels the Company had in 2019, in advance of 2020, during which we expect to finalize the pilot development in CASE." 2019 Year-End Reserves Report: Discussion of Reserves Centaurus' year end 2019 reserves were evaluated by independent qualified reserves evaluators GLJ Petroleum Consultants Ltd. ("GLJ"). The evaluation of Centaurus' properties in Argentina was done in accordance with the definitions, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook and National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities. The following tables summarize information contained in the independent reserves report prepared by GLJ with an effective date of December 31, 2019, dated January 24, 2020 (the "GLJ 2019 Report"), with comparatives to the independent reserves report prepared by GLJ with an effective date of December 31, 2018 (the "GLJ 2018 Report", and collectively with the GLJ 2019 Report and the GLJ 2018 Report, the "GLJ Reports"). Additional reserve information as required under NI 51-101 will be included in the Company's Annual Information Form which the Company expects to file on SEDAR by April 22, 2020. Consistent with the Company's reporting currency, all amounts are in United States dollars unless otherwise noted. The recovery and reserve estimates provided in this news release are estimates only, and there is no guarantee that the estimated reserves will be recovered. Actual reserves may eventually prove to be greater than, or less than, the estimates provided herein. In certain of the tables set forth below, the columns may not add due to rounding. All December 31, 2019 reserves presented are based on industry consensus pricing for January 1, 2020. Industry consensus pricing is based on the average price forecasts from the three largest reserves evaluation companies in Canada - GLJ Petroleum Consultants, McDaniel and Associates and Sproule Associates Limited. ("Industry Consensus"); all December 31, 2018 reserves presented are based on Industry Consensus pricing effective January 1, 2019. Centaurus' reserves are located in Argentina's Neuquen and Noroeste basins. 2019 Year-End Gross Reserves Volumes | | December 31, | Increase | | Reserves Category | 2018 | 2019 | over | | | | Dec 31, 2018 | | Mboe(1) | Mboe(1)(2) | % | | Proved Developed Producing (PDP) | 2,245 | 1,909 | -15% | | Proved Developed Non-Producing | 838 | 787 | -6% | | Proved Undeveloped | 1,795 | 2,964 | 65% | | Proved (1P) | 4,878 | 5,660 | 16% | | Probable | 5,866 | 11,219 | 91% | | Proved + Probable (2P) | 10,744 | 16,880 | 57% | | Possible(3) | 7,928 | 9,798 | 24% | | Proved + Probable + Possible (3P) | 18,672 | 26,677 | 43% | (1) Mboe is defined as thousand barrels of oil equivalent. (2) All reserves are presented as Centaurus working interest before royalties. 2019 net reserves after royalties are: PDP 1,583 Mboe, proved developed non-producing 658 Mboe, proved undeveloped 2,504 Mboe, 1P 4,744 Mboe, 2P 14,230 Mboe and 3P 22,528 Mboe. (3) Please refer to the "Oil and Gas Advisory" section for a description of each reserve category. Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities recovered will equal or exceed the sum of proved plus probable plus possible reserves. 2019 Gross Reserves by Block | Block | | | Proved + | | | Proved+ | Probable + | | Proved | Probable | Possible | | Mboe(1) | Mboe(1) | Mboe(1) | | Coiron Amargo Norte (CAN) | 266 | 749 | 1,107 | | Coiron Amargo Sur Este (CASE) | 2,617 | 10,553 | 18,406 | | Palmar Largo | 584 | 657 | 717 | | Puesto Morales | 1,470 | 3,494 | 4,808 | | Surubi | 540 | 1031 | 1,164 | | Other Blocks | 183 | 396 | 475 | | Total | 5,660 | 16,880 | 26,677 | (1) All reserves are presented as Centaurus working interest before royalties. Please refer to the "Oil and Gas Advisory" section for a description of each reserve category. Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities recovered will equal or exceed the sum of proved plus probable plus possible reserves. 2019 Gross Year-End Reserves Volumes by Product Type(1) | Product Type | Proved | Total | Total Proved | Total Proved+ | | Developed | Proved | + Probable | Probable + | | Producing | | | Possible | | Light & Medium Crude Oil (Mbbl)(2) | 1,141 | 2,553 | 5,286 | 6,942 | | Tight Crude Oil (Mbbl) | 425 | 2,612 | 10,331 | 17,885 | | Conventional Natural Gas (MMcf)(3) | 2,059 | 2,936 | 6,247 | 7,971 | | Shale Gas (MMcf)(3) | 0 | 35 | 1,331 | 3,129 | | Oil Equivalent (Mboe) | 1,909 | 5,660 | 16,880 | 26,677 | (1) All reserves are presented as Centaurus working interest before royalties. Please refer to the "Oil and Gas Advisory" section for a description of each reserve category. Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities recovered will equal or exceed the sum of proved plus probable plus possible reserves. (2) Mbbl is defined as thousands of barrels. (3) MMcf is defined as one million cubic feet. 2019 Tight Oil Year-End Gross Reserves Volumes | | December 31, | Increase | | Reserves Category | 2018 | 2019 | over | | | | Dec 31, 2018 | | Mbbl | Mbbl(1) | % | | Proved Developed Producing (PDP) | 186 | 425 | 128% | | Proved Developed Non-Producing | 0 | 0 | 0% | | Proved Undeveloped | 777 | 2,186 | 181% | | Proved (1P) | 962 | 2,612 | 172% | | Probable | 2,751 | 7,720 | 181% | | Proved + Probable (2P) | 3,714 | 10,331 | 178% | | Possible(2) | 4,991 | 7,553 | 51% | | Proved + Probable + Possible (3P) | 8,705 | 17,885 | 105% | (1) All reserves are presented as Centaurus working interest before royalties. 2019 net reserves after royalties are: PDP 362 Mbbl, proved undeveloped 1,858 Mbbl, 1P 2,220 Mbbl, 2P 8,782 Mbbl and 3P 15,202 Mbbl. (2) Please refer to the "Oil and Gas Advisory" section for a description of each reserve category. Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities recovered will equal or exceed the sum of proved plus probable plus possible reserves. Crude Oil Price Forecast - GLJ Report The price forecast used for the GLJ Report is based on Industry Consensus pricing for January 1, 2020. Forecast Prices used in Estimates effective January 1, 2020 | Brent Blend Crude Oil | | Year | % Inflation | USD/bbl | | 2020 | 0.0 | 65.25 | | 2021 | 1.8 | 67.28 | | 2022 | 2.0 | 69.98 | | 2023 | 2.0 | 71.52 | | 2024 | 2.0 | 73.08 | | 2025 | 2.0 | 74.42 | | 2026 | 2.0 | 76.03 | | 2027 | 2.0 | 77.61 | | 2028 | 2.0 | 79.15 | | 2029 | 2.0 | 80.71 | | 2030 | 2.0 | 82.32 | | 2031 | 2.0 | 83.97 | | 2032 | 2.0 | 85.65 | | 2033 | 2.0 | 87.36 | | 2034 | 2.0 | 89.11 | | 2035+ | 2.0 | +2.0%/yr | Reconciliation of Brent Price Forecast - Industry Consensus Pricing | | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | | Brent (USD$/bbl) - January 1, 2019 | 65.92 | 69.47 | 71.65 | 73.72 | 75.58 | 77.39 | | Brent (USD$/bbl) - January 1, 2020 | | 65.25 | 67.28 | 69.98 | 71.52 | 73.08 | Reserves Net Present Value Before Tax Summary - Industry Consensus Pricing Forecast(1) | Reserves Category | NPV10 | NPV10 | Increase | | December | December | over | | 31, 2018 | 31, 2019 | Dec 31-2018 | | (MM) | (MM) | % | | Proved Developed Producing (PDP) | $15.6 | $11.6 | -26% | | Proved Developed Non-Producing | $8.6 | $8.5 | -1% | | Proved Undeveloped | $5.6 | $4.8 | -14% | | Proved (1P) | $29.7 | $25.0 | -16% | | Probable | $53.7 | $104.9 | 95% | | Proved + Probable (2P) | $83.4 | $129.9 | 56% | | Possible(2) | $107.3 | $148.1 | 38% | | Proved + Probable + Possible (3P) | $190.8 | $278.0 | 46% | (1) Net present values ("NPV10") are stated in USD and are discounted at 10 percent. Please refer to the "Oil and Gas Advisory" section for a description of each reserve category. The forecast prices used in the calculation of the present value of future net revenue are based on the Industry Consensus January 1, 2019 and Industry Consensus January 1, 2020 price forecasts, respectively. The Industry Consensus January 1, 2020 price forecast will be included in the Company's Annual Information Form. (2) Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities recovered will equal or exceed the sum of proved plus probable plus possible reserves. Reserves Net Present Value After Tax Summary - GLJ Brent Forecast(1) | Reserves Category | NPV10 | NPV10 | Increase | | December | December | over | | 31, 2018 | 31, 2019 | Dec 31-2018 | | (MM) | (MM) | % | | Proved Developed Producing (PDP) | $15.6 | $11.6 | -26% | | Proved Developed Non-Producing | $8.6 | $8.5 | -1% | | Proved Undeveloped | $3.9 | $4.2 | 8% | | Proved (1P) | $28.1 | $24.3 | -14% | | Probable | $36.8 | $65.7 | 79% | | Proved + Probable (2P) | $64.9 | $90.1 | 39% | | Possible(2) | $83.8 | $99.9 | 19% | | Proved + Probable + Possible (3P) | $148.7 | $189.9 | 28% | (1) Net present values are stated in USD and are discounted at 10 percent. All reserves are presented as Centaurus working interest before royalties. Please refer to the "Oil and Gas Advisory" section for a description of each reserve category. The forecast prices used in the calculation of the present value of future net revenue are based on the Industry Consensus January 1, 2019 and Industry Consensus January 1, 2020 price forecasts, respectively. The Industry Consensus January 1, 2020 price forecast will be included in the Company's Annual Information Form. (2) Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities recovered will equal or exceed the sum of proved plus probable plus possible reserves. Reserve Life Index ("RLI") | | Dec. 31, 2018(1) | Dec. 31, 2019(2) | | Proved Developed Producing (PDP) | 3.6 | 2.5 | | Proved (1P) | 7.7 | 7.4 | | Proved Plus Probable (2P) | 17.0 | 22.2 | (1) Calculated by dividing the amount of the relevant reserves category by average Q4 2018 production of 1,730 boe/d annualized. (2) Calculated by dividing the amount of the relevant reserves category by estimated average Q4 2019 production of 2,086 boe/d annualized. 2019 Year-End Reconciliation of Company Gross Reserves | | Total Proved | Total Proved + | Total Proved + | | | Probable | Probable + | | | Possible | | Mboe | Mboe | Mboe | | December 31, 2018 | 4,878 | 10,744 | 18,672 | | Technical Revisions | -504 | -324 | -1,427 | | Extensions & Improved Recovery(1) | 2,027 | 7,201 | 10,173 | | Acquisitions | 0 | 0 | 0 | | Economic Factors | 0 | 0 | 0 | | Production | -741 | -741 | -741 | | December 31, 2019(2) | 5,660 | 16,880 | 26,677 | (1) Extensions & improved recovery are predominantly associated with the evaluations of the Coiron Amargo Sur Este (CASE) block. (2) Subject to final reconciliation adjustments. All reserves are presented as Centaurus working interest before royalties. Please refer to the "Oil and Gas Advisory" section for a description of each reserve category. Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities recovered will equal or exceed the sum of proved plus probable plus possible reserves. The estimates of reserves and future net revenue for individual properties may not reflect the same confidence level as estimates of reserves and future net revenue for all properties, due to the effects of aggregation. Future Development Costs FDC reflects GLJ's best estimate of what it will cost to bring the proved undeveloped and probable reserves on production. Changes in forecast FDC occur annually as a result of development activities, acquisition and disposition activities, and changes in capital cost estimates based on improvements in well design and performance, as well as changes in service costs. FDC for total 2P Argentina reserves increased to $245.6 million at year-end 2019 from $143.3 million at year-end 2018. | ($ millions) | Total Proved | Total Proved Plus Probable | | 2020 | 21.9 | 22.0 | | 2021 | 26.7 | 41.1 | | 2022 | 9.4 | 75.1 | | 2023 | 15.0 | 51.4 | | Remainder | 6.6 | 56.0 | | Total (undiscounted) | 79.6 | 245.6 | About Centaurus Energy Centaurus is an independent upstream oil and gas company with both conventional and unconventional oil and gas operations in Argentina. The Company's shares trade on the TSX Venture Exchange under the symbol CTA and on the OTCQX under the symbol CTARF. For further information please contact: David Tawil
Interim Chief Executive Officer |