Vanoil Energy Ltd VNLEF

3.6 billion barrels of oil......

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VANOIL ANNOUNCES INDEPENDENT RESOURCE ESTIMATE AND TERMINATES NON BINDING LETTER OF INTENT
8/9/2011 11:01:04 AM - Market Wire
VANCOUVER, BRITISH COLUMBIA, Aug 09, 2011 (MARKETWIRE via COMTEX News Network) --
Vanoil Energy Ltd. ("Vanoil" or the "Company") (TSX VENTURE: VEL) is pleased to announce, an independent assessment of the Company's prospective resources has been completed by Sproule International ("Sproule"). The independent assessment was carried out in accordance with the standards established by the Canadian Securities Administrators in National Instrument ("NI") 51-101 Standards of Disclosure for Oil and Gas Activities. The effective date of the report is May 31, 2011.
Vanoil properties include a 100% working interest in Company operated Production Sharing Contracts (PSCs) in Kenya Blocks 3A and 3B. The Blocks are at the confluence of three Basins, the Anza, the Mochesa and the Lamu containing Jurassic, Cretaceous and Tertiary plays. The Vanoil NI 51 101 report covers the South Anza Basin only which represents approximately one third of the 200 by 110 square kilometres in Blocks A and B combined.
The Sproule report incorporated the results of approximately 2,000 line- kilometre of 1970's vintage seismic shot by Chevron and reprocessed by Vanoil in 2009 as well as 449 line- kilometre of infill seismic shot by Vanoil in 2010. This 5 million dollar program was conducted by the Bureau of Geophysical Prospecting ("BGP") is one of the world's leading geophysical service companies. The chevron 2000 kilometre data contained amplitude anomalies over the leads that were profiled in 2010 with longer spread lengths that confirmed on relative amplitude processing that they were class III Amplitude versus offset (AVO) anomalies. Further chimney analysis of the post seismic attributes indicates sealing faults on some of the leads. A 3D seismic program will be designed targeting the most highly ranked leads which will also be the focus for a 2012 drilling campaign in Block 3A.
As may be seen in the following table, Sproule's Best Estimate of gross unrisked undiscovered petroleum initially in place is approximately 3.6 billion barrels of oil equivalent (MMboe); the associated Best Estimate of gross unrisked recoverable volumes Prospective Resources is approximately 840 million barrels of oil equivalent. The Company cautions that BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
The Sproule assessment identifies twenty seven leads in the South Anza Basin solely contained in Block 3A, the termination rift segment of the Anza Graben which originates in the Sudan. The Anza Graben is the southern extension of the oil prolific Muglad and Melut rift basins of South Sudan. Analogies of the basin with Sudanese oil fields is observed from similar faulting patterns and geochemical analysis of oil recovered from wells in drilled in the Anza Graben.
The Company also reports that it has completed its due diligence and as a result have terminated all negotiations with respect to a previously announced non-binding letter of intent (see press release dated May 26, 2011), with respect to an arm's length business combination.