6 Nov 2018 07:00
Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. With the publication of this announcement, this information is now considered to be in the public domain.
6 November 2018
Cabot Energy Plc
("Cabot Energy" or the "Company")
Annual Reserves and Resources Report
Cabot Energy (AIM: CAB), the AIM quoted oil and gas company creating predictable production growth in Canada balanced with high impact exploration in Italy, announces the results of its annual reserves and resources report for its production and development assets in Canada. The results are as determined by McDaniel & Associates Consultants Ltd as at 30 September 2018. The data is compared with and reconciled to the position at 30 September 2017.
Summary of Reserves & Resources
· Net Proven plus Probable ("2P") reserves of 3.6 million barrels of oil equivalent ("mmboe")
· Net 2P reserves plus Mid-Case contingent and prospective resources of 42.2 mmboe
· The net present value (before tax), using a 10 per cent. discount rate ("NPV10"), of the 2P reserves is US$48.3 million to the Company, or $13.4/boe
Changes to Reserves & Resources from last year
· Increase in gross 2P reserves of 26 percent and net resources of 339%
- 90% of prior year Probable reserves upgraded to Proven
· 2P Reserves increase of 0.75 mmboe is in addition to 0.25 mmboe of production
Scott Aitken, Chief Executive Officer, commented: "We are pleased by the annual increase in gross 2P reserves by 26% to 3.6 mmboe, and proud to have demonstrated the growth potential of the Canadian asset through the 339% increase in gross reserves and resources to 42.2 mmboe. With 33,000 bpd facilities and pipeline capacity combined with 282 well locations, the Company has demonstrated that predictable production growth beyond September 2018's 653 bopd, can be delivered in Canada through the drillbit, without major facilities capital investment, at attractive financial netbacks.
"This outcome reflects the efforts of the new management team that have studied and documented the Canadian subsurface and surface facilities as a priority for the Company and the increases announced today reflect these activities. We are now focussed on structuring the balance sheet to fund a scalable and repeatable development drilling programme in Canada. Additionally, an independent resources report on our 100% owned and operated, high-impact offshore Italian exploration acreage is currently being finalised and we continue to make progress on farm-out negotiations to fund our exploration activities."
The tables below summarise the findings of the reserves report and the resources report as at 30 September 2018:
Reserves
Proven | Proven Plus Probable | |||
mmboe | NPV101 | mmboe | NPV101 | |
Gross | 2.52 | 3.63 | ||
Net attributable to Cabot2 | 2.50 | US$37.3 million | 3.60 | US$48.3 million |
(1) US$ NPV calculated using exchange rate: 0.7609 US$/CAD (Bank of Canada, 31 October 2018)
(2) Net attributable reserves equals gross reserves calculated as to Cabot Working Interest less gross over-riding royalties due to non-Crown (Government) third parties
Resources
Contingent (Mid) | Prospective (Mid) | ||||
mmboe | Chance of Development | mmboe | Chance of Discovery | Chance of Development | |
Gross | 4.2 | 34.4 | |||
Net attributable to Cabot1 | 4.2 | 50% | 34.4 | 60% | 50% |
(1) Net attributable resources equals gross resources calculated as to Cabot Working Interest less gross over-riding royalties due to non-Crown (Government) third parties
A copy of the McDaniel & Associates Consultants Ltd reserves report and the executive summary of the McDaniel & Associates resources report will be made available on the Company's website at www.cabot-energy.com
For further information please contact:
Cabot Energy Plc | +44 (0)20 7469 2900 |
Scott Aitken, CEO Petro Mychalkiw, CFO | |
SP Angel Corporate Finance LLP | +44 (0)20 3470 0470 |
Nominated Adviser and Joint Broker | |
Richard Morrison, Richard Hail, Stephen Wong | |
GMP FirstEnergy | +44 (0)20 7448 0200 |
Joint Broker | |
Jonathan Wright, David van Erp | |
Luther Pendragon | +44 (0)20 7618 9100 |
Financial PR | |
Harry Chathli, Alexis Gore |
In Accordance with AIM Rules - Guidance for Mining and Oil & Gas Companies, the information contained in this announcement has been reviewed and signed off by the CTO of Cabot Energy, Mr Campbell Airlie, who has over 35 years' experience as a petroleum engineer, and is supported by the Cabot Board of Directors. He has read and approved the technical disclosure in this regulatory announcement. The technical disclosure in this announcement complies with the SPE standard.
Note to Editors:
Cabot Energy (AIM: CAB), is an oil and gas company creating predictable production growth in Canada balanced with high impact exploration in Italy. Comprehensive information on Cabot Energy and its oil and gas operations, including press releases, annual reports and interim reports are available from Cabot Energy's website: www.cabot-energy.com
GLOSSARY
US$ | United States Dollars |
% | Percent |
1P | Proven reserves |
2P | Proven plus probable reserves |
3P | Proven plus probable plus possible reserves |
B | Billion |
boe | Barrel of oil equivalent. Gas is converted to equivalent liquid volumes at 6000 CF gas per boe |
CF | Cubic Feet of gas at standard conditions of 14.7psia and 60oF |
Chance of development | The estimated probability that, once discovered, a known accumulation will be commercially developed. For contingent resources the chance of commerciality is equal to the chance of development. For prospective resource, the chance of commerciality includes both the chance of discovery and development. |
Chance of discovery | The estimated probability that exploration activities will confirm the existence of a significant accumulation of potentially recoverable petroleum. |
Contingent Resources | Those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingencies may include factors such as economic, legal, environmental, political, and regulatory matters, or a lack of markets. It is also appropriate to classify as contingent resources the estimated discovered recoverable quantities associated with a project in the early evaluation stage. Contingent resources are further classified in accordance with the level of certainty associated with the estimates and may be sub-classified based on project maturity and/or characterized by their economic status. |
m | Thousand |
mm | Million |
mmbbl | Million barrels of oil |
mmboe | Million barrels of oil equivalent. Gas is converted to equivalent liquid volumes at 6 BCF gas per mmboe |
Mid Estimate | Means a 50% probability (P50) that the quantities actually recovered will equal or exceed the Mid Estimate (in statistical terms, a median). |
Proven Reserves ('Proven') | Those quantities of petroleum, which by analysis and geoscience, can be estimated with reasonable certainty to be commercially recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated Proven Reserves |
Probable Reserves ('Probable') | Those additional reserves that are less likely to be recovered than Proven Reserves but more certain to be recovered than Possible Reserves. It is equally likely that actual remaining quantities recovered will be greater than or less than the sum of the estimated Proven plus Probable Reserves |
Possible Reserves ("Possible") | Those additional reserves that are less certain to be recovered than probable reserves. It is unlikely that the actual remaining quantities recovered will exceed the sum of the estimated proven + probable + possible reserves |
Prospective Resources | Those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective resources have both an associated chance of discovery and a chance of development. Prospective resources are further subdivided in accordance with the level of certainty associated with recoverable estimates assuming their discovery and development and may be sub-classified based on project maturity. |