News CALGARY, Oct. 30 /CNW/ - Alberta Oilsands Inc. (the "Company" or "AOS")
announces that Ryder Scott Company Canada, Petroleum Consultants ("Ryder
Scott"), an independent petroleum consulting firm, has completed its National
Instrument 51-101 ("51-101") compliant assessment of the bitumen resources for
the Fort McMurray property and assigned 2.8 billion barrels of original
bitumen in place (OBIP) for the McMurray formation. The Ryder Scott report
classified the resource into undiscovered, discovered and contingent
categories.
Fort McMurray
The Fort McMurray asset comprises approximately 28 sections (17,918 acres
or 7,167 hectares) of 100% working interest oil sands leases. The land is
situated amid the main oil sands fairway at Township 88 Ranges 7 to 9 West of
the 4 Meridian (Twp 88 R07W4M to R09W4M) in the Athabasca region of northeast
Alberta, Canada.
Resource volumes assigned are 2.42 billion barrels discovered and 401
million barrels undiscovered. Ryder Scott has assigned contingent
(recoverable) resources of 201 million barrels for a portion of the lands,
using a 50% recovery factor and assuming a typical steam assisted gravity
drainage (SAGD) process for extraction of the bitumen from the discovered
resources.
The Fort McMurray resource assessment utilized openhole logs and core
data from penetrations on the land parcel as well as penetration data
immediately offsetting the lands. There are a total of six (6) well
penetrations on the lands. Data from approximately thirty (30) well
penetrations on and offsetting the lands were used to estimate average
reservoir parameters used in the OBIP calculation. A McMurray formation
bitumen net pay contour map was created over the parcel area using net bitumen
pay estimates from approximately fifty (50) wells. Only net bitumen pay
contours greater than 10 meters were included in the resource volume
calculation.
The 201 million barrels contingent (recoverable) resources assigned in
the report reflect areas of the Fort McMurray lands where there are high
probability of bitumen pay and ready surface accessibility. AOS is preparing
an oil sand exploration (OSE) application for a winter work program in this
area. In addition, the Company is pursuing consultation with stakeholders over
the remaining lands and will report further significant developments as they
arise. The Company expects its 2007/2008 winter coring program to result in
the reclassification of current discovered resources into additional
contingent resources and a portion of the current contingent resources to
reserves.
The previously announced Ryder Scott 51-101 compliant resource assessment
of the Hangingstone East property (news release dated May 17, 2007) yielded an
estimated undiscovered resource of 1.15 billion barrels. AOS owns 23 sections
of 100% working interest lease and permit lands on the Hangingstone East
property.
Ryder Scott has also completed a resource assessment on a third prospect
area, AOS's Hangingstone West (Algar Lake) property. The 51-101 compliant
report assigned 807 million barrels of undiscovered unrecoverable resources
for the property. The Ryder Scott report includes bitumen potential from the
McMurray and Wabiskaw formations and included all pay potential without pay
thickness cut-offs. The Ryder Scott findings are consistent with the AEUB
Alberta Crude Bitumen Reserve Atlas (May 1996) indication of approximately 800
million barrels OBIP in the area lands. The assessment was done at an early
stage of resource delineation.
In summary, the three Ryder Scott resource assessments in the Ft.
McMurray, Hangingstone East and Hangingstone West (Algar Lake) properties
assign the Company a total of approximately 4.8 billion barrels of discovered
and undiscovered resources (see Table 1).
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Table 1 - Summary of AOS's Total Bitumen Resource Potential
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Property Name Resources (millions of barrels)
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Undiscovered Discovered Total
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Fort McMurray 401 (i)2,421 2,822
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Hangingstone East 1,150 0 1,150
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Hangingstone West 807 0 807
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Total Resources 2,358 2,421 4,779
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(i) 201 million barrels of contingent (recoverable) resources are
assigned in the discovered resource category
>>
Mr. Shabir Premji, Executive Chairman of the Company, stated "The Fort
McMurray asset is on the main Athabasca oil sands fairway. We will prioritize
the delineation of this asset and focus on converting the bitumen resources to
reserves as quickly as possible."
The Company also announces that it has entered into an arrangement to
obtain a $5.0 million credit facility with a Canadian financial institution.
Subject to regulatory approval, 116,279 common shares of the company are
expected to be issued in connection with securing the credit facility.