CALGARY, AB, Jan. 31, 2022 /CNW/ - Pan Orient Energy Corp. ("Pan Orient" or the "Company") (TSXV: POE), on behalf of Pan Orient Energy (Siam) Ltd. ("POS"), announced the results of its December 31, 2021 independent reserves evaluation for Thailand on-shore Concession L53/48 where POS is the operator and has a 100% working interest. Pan Orient has a 50.01% equity interest in POS, which is classified as a Joint Venture under International Financial Reporting Standards and accounted for using the equity method. Pan Orient's 50.01% equity interest in the assets, liabilities, working capital, operations and capital expenditures of POS are recorded in Investment in the Thailand Joint Venture and Pan Orient does not have any direct interest in, or control over, the crude oil reserves or operations of on-shore Concession L53/48.
The evaluation for the Thailand assets as at December 31, 2021 was conducted by Sproule International Limited of Calgary ("Sproule") and was prepared in accordance with Canadian Securities Administrators National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities.
Please note that all amounts are in Canadian dollars unless otherwise stated and BOPD refers to barrels of oil per day. Reserves volumes reported below are "Company Gross Reserves", a classification of reserves used in the evaluation which represents production and reserves before deduction of royalties.
Summary of Thailand Reserves at December 31, 2021 for Concession L53/48
- Thailand crude oil reserves and values at December 31, 2021 of POS (representing the 100% working interest of POS in Concession L53/48):
- Proved oil reserves ("1P") of 3,079,000 barrels at December 31, 2021, a 9% increase from the 2,836,000 barrels at December 31, 2020.
- Proved plus probable oil reserves ("2P") decreased 3% to 4,625,000 barrels at December 31, 2021 compared with proved plus probable oil reserves of 4,753,000 barrels at December 31, 2020. The decrease in 2021 reflects the following changes during 2021:
- Oil sales increased 15% in 2021 to 1,018,286 barrels (2,790 BOPD), with 874,060 barrels (2,395 BOPD) from the L53DD field, 53,847 barrels (148 BOPD) from the L53G field, 32,649 barrels (89 BOPD) from the L53A field, 32,557 barrels (89 BOPD) from the L53D field, 15,730 barrels (43 BOPD) from the L53B field, 5,625 barrels (15 BOPD) from the L53AA field and 3,818 barrels (10 BOPD) from the L53AA South field.
- Proved plus probable reserves increased 890,000 barrels at December 31, 2021 (19% of December 31, 2020 proved plus probable reserves) from positive technical revisions of 821,000 barrels, 59,000 barrels for economic factors and 10,000 barrels for extension of fields.
- The L53DD field had 874,060 barrels of oil sales in 2021 compared with 734,006 barrels in 2020. The L53DD field at December 31, 2021 has been assigned proved plus probable reserves of 3,345,000 barrels, including a positive technical revision (inclusive of economic factors) of proved plus probable reserves in 2021 of 751,000 barrels relating to revised geological mapping and well performance. This compared with 3,468,000 barrels at December 31, 2020.
- Net present value (after tax) of Thailand proved plus probable oil reserves at December 31, 2021, using forecast prices and costs discounted at 10% per year, of Cdn$108.2 million. The 39% increase in the net present value (after tax) of Thailand proved plus probable oil reserves from $77.8 million at December 31, 2020 is the result of the 31% increase average oil sales prices more than offsetting the 3% decrease in proved plus probable reserves. The average oil sales price increased to $88.64 per barrel in the December 31, 2021 reserves report compared with $67.82 in the December 31, 2020reserves report.
- Possible oil reserves have been reported for the last four years to better define the potential upside of the L53DD field discovered in 2018. 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.
Possible oil reserves at December 31, 2021 are 1,346,000 barrels and decreased 745,000 barrels from the prior year as possible reserves were moved into proved and probable reserves. Total proved plus probable plus possible oil reserves ("3P") are 5,971,000 barrels at December 31, 2021 with a net present value (after tax) using forecast prices and costs discounted at 10% per year, of Cdn$131.4 million. - Thailand Concession L53/48 reserves are from conventional sandstone reservoirs.
- Net to Pan Orient's 50.01% equity interest in POS:
- Pan Orient does not have any direct interest in, or control over, the crude oil reserves or operations of on-shore Concession L53/48. The values at December 31, 2021 identified as "Net to Pan Orient's 50.01% Equity Interest in Pan Orient Energy (Siam) Ltd." represent 50.01% of POS reserves and values.
- Net to Pan Orient's 50.01% equity interest in POS, proved plus probable crude oil reserves of 2,313,000 barrels at December 31, 2021. Net to Pan Orient's 50.01% equity interest in POS, net present value (after tax) of Thailand proved plus probable crude oil reserves at December 31, 2021, using forecast prices and costs discounted at 10% per year, of Cdn$54.1 million, or $1.09 per Pan Orient share based on the 49.8 million Pan Orient shares outstanding at December 31, 2021.
- Net to Pan Orient's 50.01% equity interest in POS, proved plus probable plus possible crude oil reserves of 2,986,000 barrels at December 31, 2021. Net to Pan Orient's 50.01% equity interest in POS, net present value (after tax) of Thailand proved plus probable plus possible crude oil reserves at December 31, 2021, using forecast prices and costs discounted at 10% per year, of Cdn$65.7 million, or $1.32 per Pan Orient share based on the 49.8 million Pan Orient shares outstanding at December 31, 2021.
| Summary of Thailand Crude Oil Reserves as of December 31, 2021, as provided by Sproule |
| Net to Pan Orient's 50.01% Interest in Pan Orient Energy (Siam) Ltd |
| Marketable Reserves – Company Gross (thousands of
barrels) | Light and
Medium Oil | Heavy Oil | Total |
| Proved | 1,057 | 483 | 1,540 |
| Probable | 540 | 233 | 773 |
| Total Proved plus Probable | 1,597 | 716 | 2,313 |
| Possible | 428 | 245 | 673 |
| Total Proved, Probable & Possible | 2,025 | 961 | 2,986 |
| Summary of Thailand Net Present Values as of December 31, 2021, as provided by Sproule (After Income Tax) |
| Net to Pan Orient's 50.01% Interest in Pan Orient Energy (Siam) Ltd |
| Present Value - After Tax (Cdn$ million) | Undiscounted | 5% | 10% | 15% |
| Proved | 48 | 43 | 39 | 36 |
| Probable | 25 | 19 | 15 | 12 |
| Total Proved plus Probable | 73 | 62 | 54 | 48 |
| Possible | 23 | 16 | 12 | 9 |
| Total Proved, Probable & Possible | 96 | 78 | 66 | 57 |
| Per Pan Orient share - Proved & Probable Note | $ 1.46 | $ 1.24 | $ 1.09 | $ 0.97 |
| Per Pan Orient share - Proved & Probable & Possible Note | $ 1.93 | $ 1.56 | $ 1.32 | $ 1.15 |
| |
| Note: Per share values were calculated based on 49,793,907 Pan Orient shares outstanding at December 31, 2021 |
| |
| Summary of Thailand Crude Oil Reserves as of December 31, 2021, as provided by Sproule |
| Pan Orient Energy (Siam) Ltd. (with a 100% working interest in Concession L53/48) |
| Marketable Reserves – Company Gross (thousands of
barrels) | Light and
Medium Oil | Heavy Oil | Total |
| Proved | 2,113 | 966 | 3,079 |
| Probable | 1,080 | 466 | 1,546 |
| Total Proved plus Probable | 3,193 | 1,432 | 4,625 |
| Possible | 856 | 490 | 1,346 |
| Total Proved, Probable & Possible | 4,049 | 1,922 | 5,971 |
| Summary of Thailand Crude Oil Reserves as of December 31, 2021, by Major Field as provided by Sproule – Company Gross (thousands of barrels) | |
| Pan Orient Energy (Siam) Ltd. (with a 100% working interest in Concession L53/48) | |
| Concession L53/48 (by Major Field) | Proved | Probable | Proved plus
Probable | Possible | Proved,
Probable &
Possible |
| L53A Field | 169 | 107 | 276 | 121 | 397 |
| L53B Field | 156 | 71 | 227 | 90 | 318 |
| L53D Field | 192 | 143 | 336 | 176 | 511 |
| L53G Field | 235 | 80 | 315 | 78 | 392 |
| L53DD Field | 2,290 | 1,055 | 3,345 | 782 | 4,127 |
| L53AA South Field | - | 77 | 77 | 89 | 165 |
| L53AA Field | 37 | 12 | 49 | 12 | 61 |
| | 3,079 | 1,546 | 4,625 | 1,346 | 5,971 |
Reconciliation of Changes in Thailand Crude Oil Proved plus Probable Reserves as of December 31, 2021, as provided by Sproule – Company Gross (Light and Medium Oil and Heavy Oil) Pan Orient Energy (Siam) Ltd. (with a 100% working interest in Concession L53/48) |
| (thousands of barrels) | | Proved | Probable | Proved plus
Probable |
| December 31, 2020 | | 2,836 | 1,917 | 4,753 |
| Discoveries | - | - | - |
| Extensions | | - | 10 | 10 |
| Infill Drilling | | - | - | - |
| Improved Recovery | | - | - | - |
| Acquisitions | | | | - |
| Dispositions | | | | - |
| Economic Factors | | 13 | 46 | 59 |
| Technical Revision | | 1,248 | (427) | 821 |
| Production | | | (1,018) | - | (1,018) |
| December 31, 2021 | | 3,079 | 1,546 | 4,625 |
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| Summary of Thailand Net Present Values as of December 31, 2021, as provided by Sproule (After Income Tax)
Pan Orient Energy (Siam) Ltd. (with a 100% working interest in Concession L53/48) |
| Present Value - After Tax (Cdn$ million) | Undiscounted | 5% | 10% | 15% |
| Proved | 95 | 86 | 78 | 72 |
| Probable | 51 | 38 | 30 | 25 |
| Total Proved plus Probable | 146 | 124 | 108 | 97 |
| Possible | 46 | 32 | 23 | 18 |
| Total Proved, Probable & Possible | 192 | 155 | 131 | 115 |
| Thailand Concession L53/48 Reserves Evaluation as of December 31, 2021, as provided by Sproule Pan Orient Energy (Siam) Ltd. (with a 100% working interest in Concession L53/48) |
| Notes: | | | | | | |
| 1) | Pan Orient Energy (Siam) Ltd. is the operator and 100% working interest owner of Concession L53/48. Pan Orient holds a 50.01% equity interest in Pan Orient Energy (Siam) Ltd. Thailand reserves and values at December 31, 2021 shown as "100% working interest of Pan Orient Energy (Siam) Ltd." represent a 100% working interest in Concession L53/48. | |
| 2) | Reserves volumes reported above are "Company Gross Reserves", a classification of reserves used in the evaluation which represents production and reserves before deduction of royalties. | |
| 3) | The tables shown have assessed reserves at forecast crude oil reference prices & costs. | |
| 4) | The US$ reference price for crude oil per barrel (US$ UK Brent per barrel) is $75.00 for 2022, $72.00 for 2023, $70.00 for 2024, $71.40 for 2025, $72.83 for 2026, and prices increase at 2.0% per year thereafter. | |
| 5) | Oil revenue for these reserves is based on 94% of the forecast crude oil Brent reference price. | |
| 6) | Tables show assessed reserves with a foreign exchange rate of CDN$1=US$0.80. | |
| 7) | The capital cost and operating expense inflation rate is 0% per year in 2022 and 2.0% per year starting in 2023. | |
| 8) | Estimated future undiscounted development costs, in dollars, at December 31, 2021 were Cdn$8.0 million for proved reserves, Cdn$10.2 million for proved plus probable reserves and Cdn$10.2 million for proved plus probable plus possible reserves. | |
| 9) | Net present values after income tax are after deduction of the SRB (Special Remuneratory Benefit tax) and income tax in Thailand. Based on the forecast oil rates and prices, SRB is forecast to be paid in 2022 with SRB tax rate of Cdn$1.3 million for proved plus probable reserves and Cdn$2.6 million for proved plus probable plus possible reserves. | |
| 10) | Well abandonment and reclamation costs of Cdn$5.3 million for the proved plus probable case were included in this report and include abandonment and reclamation costs for all existing and future wells. Well abandonment and reclamation costs of Cdn$5.8 million were included for the proved plus probable plus possible case. No allowances for salvage values were made. | |
| 11) | The net present values disclosed may not represent fair market value. | |
| 12) | Totals may not add exactly due to rounding. | |
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Pan Orient is a Calgary, Alberta based oil and gas exploration and production company with operations currently located onshore Thailand and in Western Canada.