Hemisphere Energy Announces 49 Increase Proved Developed Producing Reserves
Hemisphere Energy Corporation (TSX-V: HME) (“Hemisphere” or the “Company”) announced highlights from its independent reserves evaluation as at December 31, 2015 prepared by McDaniel & Associates Consultants Ltd. (“McDaniel”).
In 2015, Hemisphere spent $2.4 million of development capital on its assets with specific focus on increasing fluid handling capacity in Jenner and implementing three enhanced oil recovery projects in its Atlee Buffalo oil pools in order to increase reserves without drilling any new wells. As a result of prudent capital allocation and constant emphasis on improving capital efficiencies and reducing costs, Hemisphere achieved another year of significant reserve growth adding 860.3 Mboe of Proved reserves at a finding and development cost (“F&D”) of $0.24/boe, including changes in future development capital.
This year-over-year growth was primarily due to waterflood recognition in the Upper Mannville F pool in Atlee Buffalo and positive technical revisions in Jenner as a result of well performance.
Hemisphere achieved an average corporate production rate for 2015 of approximately 776 boe/d (80% oil), which is a 14% increase over 2014 despite the conversion of two producing wells to water injectors in Atlee Buffalo and minimal development capital spending.
2015 Reserve Highlights
Added 860.3 Mboe of Proved reserves, replacing 304% of estimated 2015 production at an F&D cost of $0.24/boe, including changes in future development capital.
Achieved a 2 year average F&D of $10.70/boe on a Proved plus Probable basis, including changes in future development capital, for a recycle ratio of 2.6.
Increased Proved Developed Producing reserves by 49% to 1,631.7 Mboe (92% oil), with a net present value of $24.9 MM (NPV10 BT), a less than 3% decrease year-over-year despite a 40% reduction in the 2016 WTI price forecast.
Increased Proved reserves by 27% to 2,785.1 Mboe (95% oil), with a net present value of $34.3 MM (NPV10 BT).
Increased Proved plus Probable reserves by 18% to 3,933.9 Mboe (95% oil), with a net present value of $48.4 MM (NPV10 BT).
On a per share basis, increased Proved reserves by 26% and Proved plus Probable reserves by 17%.
Proved Developed Producing reserves represent 59% of total Proved reserves on a volume basis and 73% on a net present value basis (NPV10 BT).
Proved reserves represent 71% of the total Proved plus Probable reserves on a volume basis and 71% on a net present value basis (NPV10 BT).
Hemisphere’s December 31, 2015 net asset value is calculated at $0.56 per share despite a significant reduction in the 2016 WTI crude oil forecast price.
Proved plus Probable reserve life index is 13.9 years based on Hemisphere’s estimated 2015 average production.
Read More: Year-end 2015 Reserves
Source: Hemisphere Energy
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