23 May 2014 07:01
Rose Petroleum plc
("Rose" or the "Company")
Publication of Economic Analysis
Rose Petroleum plc (AIM Ticker: ROSE) is pleased to announce the results of an economic analysis on Rose's Mancos and Paradox Oil and Gas Projects, Utah, USA (the "Project") prepared by Christie Ward Schultz, an Independent Consultant Petroleum Engineer. The Company, through its wholly-owned subsidiary Rose Petroleum (Utah) LLC ("Rose Utah") holds a 75% working interest (59.25% net revenue interest) in certain oil, gas and hydrocarbon leases in Grand and Emery Counties, Utah covering 230,000 acres (the "Leases").
HIGHLIGHTS
· Life of Field (30 years) Net Present Value (NPV) (10%):
o Cane Creek - Paradox Basin (gross) US$ 1,473,247,200 (US$1.47 Billion)
o Mancos - Uinta Basin (gross) US$ 941,192,100 (US$941 million)
· Cane Creek (10%) Rate of return (ROR) 125%
· Mancos (10%) ROR 96.31%
· Cane Creek Net Finding and Development Costs US$19.50/boe (barrels of oil equivalent)
· Mancos Net Finding and Development Costs US$16.91/boe
· 10 years NPV (10%)
o Cane Creek - Paradox Basin (gross) US$ 660,956,105 (US$660 million)
o Mancos - Uinta Basin (gross) US$ 503,979,082 (US$503 million)
Matthew Idiens, CEO, said: "Along with the Ryder Scott's reserves report released today, we commissioned Christie Ward Schultz to produce an economic analysis of both individual Well and various Project development scenarios based on analogous Mancos and Cane Creek Production and Well costs from the surrounding area. The highlights above show the potential size of the Project and the models have been created using conservative assumptions on development role out and costs. With both basins being actively developed the infrastructure available to us is excellent with road, rail, pipeline, power, etc. are all readily available. The Leases are also in an ideal location being only about an hour's drive to Grand Junction, which is the region's Oil & Gas services hub offering drill rigs, fraccing equipment, etc. Basically, we could not be better set."
Key assumptions used by Christie Ward Schultz in preparing the economic analysis
Price:
◦ Oil - US$85/b, Flat
◦ Gas - US$3.50/mcfg (dry), Flat
◦ NGL - 40% oil bbl
OPEX:
◦ Fixed - US$5,000/well/month
◦ Artificial lift - US$2,000/well/month
◦ Processing & compression - US$0.40/mcfg
◦ Trucking - US$4/bbl
◦ Water disposal - US$2/bbl
Utah severance tax: 5% oil, 5% gas, 4% NGL
Ownership: 75% Working Interest, 59.25% Net Revenue Interest
Mancos:
◦ Capital: US$3m (drilling, completion, and equipment)
◦ 3,000 ft (TVD) Total Vertical Depth; 5,000 ft lateral length
◦ Oil Well with 2000 (scf/bbl) GOR (Gas/Oil Ratio)
◦ IP: 175 bopd (228 boepd)
◦ EUR: 169 mbo; 225 mboe
◦ Initial decline: 40%
◦ B-Factor: 0.4
◦ Final decline: 10%
Cane Creek:
◦ Capital: US$8m (drilling, completion, and equipment)
◦ 10,000ft TVD; 5,000ft lateral length
◦ Oil Well with 500 (scf/bbl) GOR
◦ Gas: 1200 - 1400 mmbtu
◦ NGL yield: 15 bbl/MM
◦ IP: 460 bopd (492 boepd)
◦ EUR: 500 mbo; 535 mboe
◦ Flat production first 9 months (since 2012, wells have been nearly flat for the first 18 months)
◦ Initial decline: 60%
◦ B-Factor: 0.95
◦ Final decline: 10%
For further information, please contact:
Rose Petroleum Plc +44 (0) 20 7225 4595
Matthew Idiens
CEO
Allenby Capital (Nominated Adviser & Broker) +44 (0) 20 3328 5656 Jeremy Porter / Alex Price
Lionsgate Communications (Public Relations) +44 (0) 20 3697 1209 Jonathan Charles / Lynn Carratt
John Blair (BSc Geology and MSc Geophysics), Head of New Ventures for Rose Petroleum plc, who meets the criteria of a qualified person under the AIM Rules - Note for Mining and Oil & Gas Companies, has reviewed and approved the technical information contained within this announcement.
Christie Ward Schultz is US based and holds a BSc in Petroleum Engineering, Texas Tech University. She has over 14 years of experience in the oil exploration and production industry.
About Rose Petroleum
Rose Petroleum plc (AIM Ticker: ROSE) is focusing on developing its oil & gas portfolio, whilst seeking to create value from its existing mining portfolio. In 2013, Rose Petroleum raised additional capital, appointed John Blair as Head of New Ventures and brought in an in-house technical team including geological and drilling expertise to pursue new oil and gas assets.
In January 2014, the Company announced that it had completed the acquisition of three licences in Germany, two licences in Baden-Württemberg covering approximately 635,000 acres (2,560 square kilometres) with each licence area represented to have at least four target pay zones, and the third licence covering 657,000 acres (2,640 square kilometres) located in the Weiden Basin (northeast Bavaria).
In March 2014, Rose signed a farm-in agreement under which its newly formed subsidiary, Rose Petroleum (Utah) LLC, can earn 75% of certain oil, gas and hydrocarbon leases covering approximately 195,000 net acres in Grand and Emery Counties, Utah, USA, within the Paradox and Uinta basins. This acreage was then increased to 230,000 in May 2014. Management intends to build on these projects to establish a balanced international asset portfolio.
For further information please consult the Company's website: www.rosepetroleum.com
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