STA.L Regulatory News (STA)

17 December 2013 The ManagerCompany AnnouncementsAustralian Securities Exchange LimitedLevel 6, 20 Bridge StreetSydney NSW 2000 Range completes farm-in agreement with Niko Resources Highlights: - Range increases its Trinidad footprint by 280,000 gross acres through the formal execution of a farm-in with Niko Resources Ltd. on the Guayaguayare block in Trinidad; - The Farm-in provides Range with broad exposure to both onshore and offshore potential with excellent synergies between Range's three existing blocks and the Guayaguayare block; - Range to gain exposure to both shallow and deep oil-producing horizons within the Guayaguayare block, including the highly prospective Cretaceous section, believed to be the source rock for Trinidad's prolific onshore petroleum system; and - Multiple onshore areas within the Guayaguayare block represent (on a 100% interest basis) a best case prospective resource of approximately 100 MMbo, while the offshore areas have a best case prospective resource of 33 MMboe. Range Resources Limited ("Range" or "the Company") is pleased toannounce that further to its announcement on 4 July 2013, the farm-inagreement has now been formally executed with Niko Resources Ltd. ("Niko")(TSX:NKO) the leading Canadian exploration and development company, regardingthe Guayaguayare Block in Trinidad. The farm-in agreement is subject to finalregulatory approval. Under the terms of the farm-in agreements, Range will earn 50% ofNiko's existing interests in the deep and shallow rights covering both onshoreand offshore areas, with the consortium to drill two onshore wells: oneshallow onshore well to a maximum of 5,000 ft., and one deep onshore well to aminimum of 5,000 ft. The two onshore wells will test approximately 22% of theprospective resource estimate with the wells to be drilled in the vicinity ofthe Beach Marcelle Field. The Beach field itself has produced over 30 MMbo todate. In the event of a discovery from either of the two initial wells, theconsortium will then look to drill an initial appraisal well. The first wellis targeted to spud in early 2014. Range will fund the two onshore wells and the potential initialappraisal well at its sole expense, and will share costs equally with Nikothereafter, including the cost of drilling an initial offshore test. Expectedto be drilled from an onshore location, the offshore well will test a prospectthat targets the 33 MMboe best case (on a 100% interest basis) prospectiveresource. The Guayaguayare Block represents the largest addition to Range'sTrinidad portfolio to date, increasing the Company's acreage position by morethan 280,000 acres. With several producing fields within the block boundaries,including the Company's own Beach Marcelle Field, the Guayaguayare Blockcombines shallow drilling targets with significant exploration potential andan expansive area within a highly prolific petroleum system. With severalhigh–impact prospects already identified on the block. The farm–in presents Range with a perfect opportunity to addhighly prospective acreage on trend with its existing exploration, developmentand secondary recovery projects, while leveraging its fleet of drilling andproduction rigs and operating experience within the region. Given theCompany's ongoing production operations in South Quarry, Morne Diablo, andBeach Marcelle, Range is uniquely positioned to operate future discoveries,both on or offshore, which in turn should result in appreciable synergies andlower operating costs. The Guayaguayare Block Overview The Block surrounds Range's Beach Marcelle Field, and extends southto the limits of Trinidad's territorial waters. In addition to provenTertiary–age exploration targets, the block is believed to hold significantpotential in the Cretaceous section, which has been successfully developed inthe Eastern Venezuelan basin. Four prospective onshore areas have beenidentified within the Guayaguayare Block, each considered to have significantpotential for oil, whilst the offshore structural complex is believed to havesignificant potential for large gas discoveries with several large structuresmapped. Niko currently holds shallow and deep Production Sharing Contractsfor 65% of the onshore portion (Range to earn 32.5% on a cost recoverablebasis) and 80% of the offshore portion (Range to earn 40% on a costrecoverable basis) of the license area with the Guayaguayare Block comprising280,216 shallow acres and 294,054 deep acres. Trinidad's State Owned petroleumcompany, Petrotrin, holds the remaining balance of the interests (35% onshoreand 20% offshore). The Guayaguayare Block is comprised of over 280,000 contiguousacres covering both onshore and offshore portions of known, productive trendsalong the southern coast of Trinidad. The Guayaguayare block is situated alongtrend with the most prolific oil and gas fields in Trinidad and lies in thetransition area between the transpressional Southern basin and the extensionalColumbus basin. A regional wrench fault, an extension of the Los Bajos fault,cuts through the onshore to offshore transition zone. Traps associated withthis fault produce oil in Southwest Trinidad and off the East Coast from UpperMiocene / Pliocene Sands. To date, the following work has been completed by Niko and previousoperators on the block: Onshore: - Acquired and processed 217km2 3D land survey Offshore: - Acquired and processed 277km2 3D marine survey (2011) - Two 3D marine surveys were reprocessed (ELF 1997 and Mobil 1990) - All 3 offshore 3D surveys have been merged prestack (total 836 km2) Yours faithfully Peter LandauExecutive Director Contacts Range Resources Limited PPR (Australia)Peter Landau David TaskerT: +61 (8) 9488 5220 T: +61 (8) 9388 0944E: plandau@rangeresources.com.au E: david.tasker@ppr.com.au GMP Securities Europe LLP RFC Ambrian Limited (Nominated Advisor)(Joint Broker) Stuart LaingRichard Greenfield / Rob Collins / T: +61 (8) 9480 2500Alexandra CarseT: +44 (0) 207 647 2800 Fox-Davies Capital Limited (Joint Old Park Lane Capital (Joint Broker)Broker) Michael ParnesDaniel Fox-Davies / Richard Hail T: +44 (0) 207 493 8188T: +44 (0) 203 463 5000 Dahlman Rose & Company (Principal American Liaison)OTCQX International Market (U.S.)Christopher Weekes / Stephen NashT: +1 (212)-372-5766 Range Background Range Resources Limited is a dual listed (ASX:RRS; AIM:RRL) oil & gasexploration company with oil & gas interests in the frontier state ofPuntland, Somalia, the Republic of Georgia, Texas, USA, Trinidad and Colombia. - In Trinidad Range holds a 100% interest in holding companies with threeonshore production licenses and fully operational drilling subsidiary.Independently assessed Proved (P1) reserves in place of 17.5 MMBO with 25.2MMBO of proved, probable and possible (3P) reserves and an additional 81 MMBOof unrisked prospective resources. Range also has a farm in with NikoResources giving it exposure to circa 280,000 acres of prospective onshore andoffshore acreage. - In the Republic of Georgia, Range holds a 40% farm-in interest in onshoreblocks VIa and VIb, covering approx. 7,000sq.km. Range completed a 410km 2Dseismic program with independent consultants RPS Energy identifying 68potential structures containing an estimated 2 billion barrels of undiscoveredoil-in-place (on a mean 100% basis) with the first (Mukhiani-1) explorationwell having spudded in July in 2011. The Company is focussing on a reviseddevelopment strategy that will focus on low-cost, shallow appraisal drillingof the contingent resources around the Tkibuli-Shaori ("Tkibuli") coaldeposit, which straddles the central sections of the Company's two blocks. - In Puntland, Range holds a 20% working interest in two licenses encompassingthe highly prospective Dharoor and Nugaal valleys. The operator and 60%interest holder, Horn Petroleum Corp. (TSXV:HRN) has completed two explorationwells and will continue with a further seismic and well program over the next12-18 months. - Range holds a 25% interest in the initial Smith #1 well and a 20% interestin further wells on the North Chapman Ranch project, Texas. The project areaencompasses approximately 1,680 acres in one of the most prolific oil and gasproducing trends in the State of Texas. Independently assessed 3P reserves inplace (on a 100% basis) of 228 Bcf of natural gas, 18 MMbbl of oil and 17MMbbl of natural gas liquids. - Range holds a 21.75% interest in the East Texas Cotton Valley Prospect inRed River County, Texas, USA, where the prospect's project area encompassesapproximately 1,570 acres encompassing a recent oil discovery. The prospecthas independently assessed 3P reserves in place (on a 100% basis) of 3.3mmbblsof oil. - Range is earning a 65% (option to move to 75%) interest in highlyprospective licences in the Putumayo Basin in Southern Colombia. The Companywill undertake a 3D seismic program in the near term as part of itsexploration commitments on the Company's Colombian interests. - Range has taken a strategic stake (19.9%) in Citation Resources Limited(ASX: CTR) which holds a 70% interest in Latin American Resources (LAR). LARholds an 80-100% interest in two oil and gas development and explorationblocks in Guatemala with Canadian NI 51-101 certified proved plus probable(2P) reserves of 2.3 MMBBL (100% basis). Range also holds a 10% interest inLAR. Table of Reserves and Resources Detailed below are the estimated reserves for the Range project portfolio. All figures in Gross Oil Range's Net AttributableMMboe Reserves Project 1P 2P 3P Interest 1P 2P 3P Operator Oil & NGL Texas - NCR * 16.4 25.2 35.3 20-25% 2.2 3.4 4.8 Western Gulf Texas - ETCV 1.0 1.6 3.3 22% 0.2 0.3 0.6 Crest Resources Trinidad 17.5 20.2 25.2 100% 17.5 20.2 25.2 Range Guatemala ** 2.3** ** 21-24% ** 0.48-0.55** ** Latin American Resources Total Oil & 34.9 47.0 63.8 19.9 21.3 28.9Liquids Gas Reserves Texas - NCR * 106.0 162.7 228 20-25% 11.7 18.1 25.4 Western Gulf Total Gas 106.0 162.7 228 11.7 18.1 25.4Reserves * Reserves attributable to Range's interest in the North Chapman Ranch asset,which are net of government and overriding royalties as described in theForrest Garb report. ** The reserves estimate for the Guatemalan Blocks in which LAR (and CTR) havean interest in is as reported by CTR. CTR has not reported 1P and 3Pestimates, but Range is seeking such information from CTR for future reportingpurposes. Detailed below are the estimated resources and oil-in-place delineated acrossRange's portfolio of project interests. All figures in MMboe Gross Oil Resources Range's Net Attributable Project Low Best/ High Interest Low Best/ High Operator Mean Mean Prospective Resources Trinidad (BM & MD) 8.1 40.5 81.0 100% 8.1 40.5 81.0 Range Trinidad - Niko JV 20.3 101.5 203.0 40%* 8.1 40.6 81.2 Rangeonshore Trinidad - Niko JV 6.6 33.0 66.0 32.5%* 2.1 10.7 21.5 Rangeoffshore Total Prospective 35.0 175.0 350.0 18.3 91.8 183.7Resources UndiscoveredOil-In-Place Puntland - 16,000 - 20% - 3,200 - Horn Petroleum Georgia - 2,045 - 40% - 818 - Strait Oil & Gas Colombia - 7.8 - 65-75% - 5.1 - 5.8 - Petro Caribbean *Range's interest in the Niko JV resources are subject to completing itsearn-in obligations. With the exception of Guatemala, all of the technical information, includinginformation in relation to reserves and resources that is contained in thisdocument has been reviewed internally by the Company's technical advisor, MrMark Patterson. Mr Patterson is a petroleum geologist and geophysicist who isa suitably qualified person with over 30 years' experience in assessinghydrocarbon reserves and has reviewed the release and consents to theinclusion of the technical information. The reserves estimate for the Guatemalan Blocks in which LAR (and CTR) have aninterest in is as reported by CTR. CTR has not reported 1P and 3P estimates,but Range is seeking such information from CTR for future reporting purposes. The reserves estimates for the 3 Trinidad blocks and update reserves estimatesfor the North Chapman Ranch Project and East Texas Cotton Valley referredabove have been formulated by Forrest A. Garb & Associates, Inc. (FGA). FGA isan international petroleum engineering and geologic consulting firm staffed byexperienced engineers and geologists. Collectively FGA staff has more than acentury of world–wide experience. FGA have consented in writing to thereference to them in this announcement and to the estimates of oil and naturalgas liquids provided. The definitions for oil and gas reserves are inaccordance with SEC Regulation S–X an in accordance with the guidelines ofthe Society of Petroleum Engineers ("SPE"). The SPE Reserve definitions can befound on the SPE website at spe.org. RPS Group is an International Petroleum Consulting Firm with officesworldwide, who specialise in the evaluation of resources, and have consentedto the information with regards to the Company's Georgian interests in theform and context that they appear. These estimates were formulated inaccordance with the guidelines of the Society of Petroleum Engineers ("SPE"). The prospective resource estimates for the two Dharoor Valley prospects areinternal estimates reported by Africa Oil Corp, the operator of the jointventure, which are based on volumetric and related assessments by Gaffney,Cline & Associates. The TSX certified 51-101 certified reserves with respect to the Guatemalanproject are as reported by ASX listed Company Citation Resources (ASX: CTR). In granting its consent to the public disclosure of this press release withrespect to the Company's Trinidad operations, Petrotrin makes norepresentation or warranty as to the adequacy or accuracy of its contents anddisclaims any liability that may arise because of reliance on it. The Contingent Resource estimate for CBM gas at the Tkibuli project is sourcedfrom the publically available references to a report by Advanced ResourcesInternational's ("ARI") report in 2009: CMM and CBM development in theTkibuli-Shaori Region, Georgia. Advanced Resources International, Inc., 2009.Prepared for GIG/Saknakhshiri and U.S. Trade and Development Agency. -.globalmethane.org/documents/ toolsres_coal_overview_ch13.pdf. Range'stechnical consultants have not yet reviewed the details of ARI's resourceestimate and the reliability of this estimate and its compliance with the SPEreporting guidelines or other standard is uncertain. Range and its JV partnerswill be seeking to confirm this resource estimate, and seek to definereserves, through its appraisal program and review of historical data duringthe next 12 months. Reserve information on the Putumayo 1 Well published by Ecopetrol 1987. SPE Definitions for Proved, Probable, Possible Reserves and ProspectiveResources Proved Reserves are those quantities of petroleum, which by analysis ofgeoscience and engineering data, can be estimated with reasonable certainty tobe commercially recoverable, from a given date forward, from known reservoirsand under defined economic conditions, operating methods, and governmentregulations. Probable Reserves are those additional Reserves which analysis of geoscienceand engineering data indicate are less likely to be recovered than ProvedReserves but more certain to be recovered than Possible Reserves. Possible Reserves are those additional reserves which analysis of geoscienceand engineering data indicate are less likely to be recoverable than ProbableReserves. 1P refers to Proved Reserves, 2P refers to Proved plus Probable Reserves and3P refers to Proved plus Probable plus Possible Reserves. Prospective Resources are those quantities of petroleum estimated, as of agiven date, to be potentially recoverable from undiscovered accumulations byapplication of future development projects. Prospective Resources have both anassociated chance of discovery and a chance of development. ProspectiveResources are further subdivided in accordance with the level of certaintyassociated with recoverable estimates assuming their discovery and developmentand may be sub-classified based on project maturity. Contingent Resources are those quantities of hydrocarbons which are estimated,on a given date, to be potentially recoverable from known accumulations, butwhich are not currently considered to be commercially recoverable. Undiscovered Oil-In-Place is that quantity of oil which is estimated, on agiven date, to be contained in accumulations yet to be discovered. Theestimated potentially recoverable portion of such accumulations is classifiedas Prospective Resources, as defined above.