Santa Maria Petroleum Inc. (TSX VENTURE:SMQ) ("Santa Maria" or the "Company") is
pleased to announce that it has obtained an updated reserve evaluation of its
oil and gas properties effective June 30, 2012 (the "Updated Reserves Report")
as prepared by Petrotech Engineering Ltd. ("Petrotech"), an independent
qualified reserves evaluator. Petrotech is the Company's independent qualified
reserve evaluator for annual disclosure requirements. The Updated Reserves
Report is an update to the reserve evaluation of the Company's oil and gas
properties effective December 31, 2011 (the "2011 Report") as prepared by
Petrotech and is based on the completion, testing and production of the Flami
field in Block 27 and revisions to operating costs and reserve data for the
Canaguay well in the Canaguaro field based on operations and production from
January 1, 2012 to June 30, 2012.
A summary report is available for review on SEDAR at www.sedar.com.
The Updated Reserves Report presented a 219% increase to the Company's net
proved and probable ("2P") heavy oil reserves and a 259% increase to the
before-tax net present value of 2P reserves at a 10% discount rate as compared
to the annual filing, effective December 31, 2011. All of the Company's reserves
are located in Colombia. The Company only has heavy oil reserves.
MARKETABLE OIL AND GAS RESERVES
Proved and Probable Reserves and Net Present Values (in $US)
(Forecast Prices and Costs)
----------------------------------------------------------------------------
Reserve NPV of Future Net Revenue Before Tax
Category Heavy Oil Reserves Discounted (in M$) @
----------------------------------------------------------------------------
100% Gross Net 0% 5% 10% 15% 20%
(Mbbl) (Mbbl) (Mbbl) (M$) (M$) (M$) (M$) (M$)
Proved:
Developed
Producing 414 104 95 3,288 2,986 2,734 2,521 2,340
Developed Non-
Producing 304 136 124 5,770 5,391 5,060 4,768 4,509
Undeveloped 1,824 530 485 4,671 3,351 2,301 1,454 764
----------------------------------------------------------------------------
Total Proved 2,542 770 704 13,729 11,729 10,095 8,744 7,613
----------------------------------------------------------------------------
Probable:
Developed
Producing 205 51 47 2,466 2,155 1,910 1,713 1,553
Developed Non-
Producing 125 35 32 1,981 1,869 1,771 1,684 1,607
Undeveloped 2,333 703 643 22,036 18,560 15,885 13,788 12,115
----------------------------------------------------------------------------
Total Probable 2,663 789 722 26,483 22,584 19,565 17,185 15,275
----------------------------------------------------------------------------
Total Proved +
Probable 5,205 1,559 1,426 40,213 34,312 29,660 25,929 22,888
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CANAGUARO FIELD
Proved and Probable Reserves and Net Present Values (in $US) for the Canaguaro Block
(Forecast Prices and Costs)
----------------------------------------------------------------------------
NPV of Future Net Revenue Before Tax
Heavy Oil Reserves Discounted(in M$) @
----------------------------------------------------------------------------
Reserve Category 100% Gross Net 0% 5% 10% 15% 20%
(Mbbl) (Mbbl) (Mbbl) (M$) (M$) (M$) (M$) (M$)
----------------------------------------------------------------------------
Proved:
Developed
Producing 414 104 95 3,288 2,986 2,734 2,521 2,340
Undeveloped 1,021 255 235 1,975 1,194 589 117 -258
----------------------------------------------------------------------------
Total Proved 1,435 359 330 5,264 4,180 3,324 2,638 2,082
----------------------------------------------------------------------------
Probable:
Developed
Producing 205 51 47 2,466 2,155 1,910 1,713 1,553
Undeveloped 1,033 258 238 6,803 5,459 4,472 3,735 3,176
----------------------------------------------------------------------------
Total Probable 1,238 309 285 9,269 7,613 6,382 5,449 4,729
----------------------------------------------------------------------------
Total Proved +
Probable 2,673 668 615 14,532 11,793 9,705 8,087 6,811
----------------------------------------------------------------------------
Total Future Net Revenue, Undiscounted (in $US) for the Canaguaro Block
(Forecast Prices and Costs)
----------------------------------------------------------------------------
Future
Reserves ANH Capital Variable Fixed Op. Pipeline Net
Category Revenue Royalty ORR Exp. Op. Exp. Exp. Tariff Revenue
----------------------------------------------------------------------------
(M$) (Mbbl) (M$) (M$) (M$) (M$) (M$) (M$)
----------------------------------------------------------------------------
Proved:
Developed
Producing 8,431 8 506 77 2,270 1,615 675 3,288
Developed
Non-
Producing
Undeveloped 20,775 20 1,247 6,599 5,771 3,468 1,715 1,975
----------------------------------------------------------------------------
Total
Proved 29,207 29 1,752 6,676 8,041 5,084 2,390 5,264
----------------------------------------------------------------------------
Probable:
Developed
Producing 4,161 4 250 0 1,129 -19 336 2,466
Developed
Non-
Producing
Undeveloped 21,028 21 1,262 3,440 5,957 1,796 1,770 6,803
----------------------------------------------------------------------------
Total
Probable 25,189 25 1,511 3,440 7,086 1,777 2,106 9,269
----------------------------------------------------------------------------
Total
Proved +
Probable 54,395 53 3,264 10,116 15,126 6,861 4,496 14,532
----------------------------------------------------------------------------
FLAMI FIELD
Proved and Probable Reserves and Net Present Values (in $US) for the LLA Block-27
(Forecast Prices and Costs)
----------------------------------------------------------------------------
NPV of Future Net Revenue Before Tax
Heavy Oil Reserves Discounted(in M$) @
----------------------------------------------------------------------------
Reserves
Category 100% Gross Net 0% 5% 10% 15% 20%
(Mbbl) (Mbbl) (Mbbl) (M$) (M$) (M$) (M$) (M$)
----------------------------------------------------------------------------
Proved:
Developed
Producing 304 136 124 5,770 5,391 5,060 4,768 4,509
Undeveloped 803 275 251 2,695 2,157 1,711 1,338 1,022
----------------------------------------------------------------------------
Total Proved 1,107 411 374 8,465 7,549 6,771 6,106 5,531
----------------------------------------------------------------------------
Probable:
Developed
Producing 125 35 32 1,981 1,869 1,771 1,684 1,607
Undeveloped 1,300 445 405 15,234 13,101 11,413 10,053 8,940
----------------------------------------------------------------------------
Total Probable 1,425 480 437 17,215 14,970 13,183 11,737 10,546
----------------------------------------------------------------------------
Total Proved +
Probable 2,532 891 811 25,680 22,519 19,954 17,842 16,078
----------------------------------------------------------------------------
Total Future Net Revenue, Undiscounted (in $US) for the LLA Block 27
(Forecast Prices and Costs)
----------------------------------------------------------------------------
Variable Pipeline Future Net
Revenue CapEx OpEx Fixed OpEx Tariff Revenue
Reserves Category (M$) (M$) (M$) (M$) (M$) (M$)
----------------------------------------------------------------------------
Proved:
Developed Producing 10,802 343 1,173 1,228 2,289 5,770
Developed Non-
Producing
Undeveloped 21,496 4,088 2,805 6,925 4,983 2,695
----------------------------------------------------------------------------
Total Proved 32,299 4,430 3,978 8,153 7,271 8,465
----------------------------------------------------------------------------
Probable:
Developed Producing 2,770 0 300 -95 584 1,981
Developed Non-
Producing
Undeveloped 35,045 942 4,647 5,970 8,253 15,234
----------------------------------------------------------------------------
Total Probable 37,815 942 4,946 5,875 8,837 17,215
----------------------------------------------------------------------------
Total Proved +
Probable 70,114 5,372 8,925 14,028 16,108 25,680
----------------------------------------------------------------------------
Pricing Assumptions
The June 29, 2012 oil price closed at $84.96 per barrel for West Texas
Intermediate (WTI),$92.46 per barrel for Vasconia Oil (posted Colombian export
oil from Platts South America) and at $97.53 per barrel for Brent. The forecast
Vasconia oil price is $91.80 per barrel for the remaining months of 2012. All
future commodity prices of crude oil prices were taken from NYMEX
(www.cmegroup.com) on the last day of trading in June 2012. The historical
prices for oil were taken from Sproule and Associates Inc. A table of forecast
crude oil prices is provided on the summary report.
Reconciliation of Reserves
The following table sets out the reconciliation of the Corporation's net
reserves based on forecast prices and costs from December 31, 2011 to June 30,
2012.
----------------------------------------------------------------------------
Heavy Oil Reserves
----------------------------------------------------------------------------
Net proved Net probable Net proved and probable
----------------------------------------------------------------------------
Opening balance 173 274 447
Technical revisions 177 11 188
Discoveries - Flami-1 374 437 811
Production (22) - (22)
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Closing balance 702 722 1,424
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About Santa Maria Petroleum Inc.
Santa Maria is a junior oil and gas company with private participating interests
in 4 blocks in the Llanos Basin of Colombia.
Cautionary Statements
This news release contains forward-looking information and forward-looking
statements within the meaning of applicable securities laws (together,
"forward-looking information"). The use of any of the words "expect",
"anticipate", "continue", "estimate", "believe", "plans", "intends",
"confident", "may", "objective", "ongoing", "will", "should", "project",
"should" and similar expressions are intended to identify forward-looking
information.
The forward-looking information is based on certain key expectations and
assumptions made by Santa Maria, including expectations and assumptions
concerning the operational results in Colombia. Although Santa Maria believes
that the expectations and assumptions on which the forward-looking information
is based are reasonable, undue reliance should not be placed on the
forward-looking information because Santa Maria can give no assurance that they
will prove to be correct.
Since forward-looking information addresses future events and conditions, by its
very nature it involves inherent risks and uncertainties. Actual results could
differ materially from those currently anticipated due to a number of factors
and risks. These include, but are not limited to, the inherent risks involved in
the exploration and development of oil and gas properties, the uncertainties
involved in interpreting drilling results and other geological data,
uncertainties relating to fluctuating oil and gas prices, the possibility of
cost overruns or unanticipated costs and expenses and other factors including
unforeseen delays. Anticipated exploration and development plans relating to
Santa Maria's properties are subject to change.
The reserves and future net revenue in this news release represent estimates
only. The reserves and future net revenue from the Company's properties have
been independently evaluated by Petrotech with an effective date of December 31,
2011 and updated to June 30, 2012. This evaluation includes a number of
assumptions relating to factors such as initial production rates, production
decline rates, ultimate recovery of reserves, timing and amount of capital,
salvage values, royalties and other government levies that may be imposed during
the producing life of the reserves.
These assumptions were based on the price forecast of Sproule and Associates
Inc. and many of these assumptions are subject to change and are beyond the
control of the Company. Actual production, sales and cash flows derived there
from, will vary from the evaluation and such variations could be material. The
present value of estimated future net cash flows referred to herein should not
be construed as the current market value of estimated heavy oil reserves
attributable to the Company's properties. Estimates of future net revenue do not
represent fair market value.
The foregoing list of assumptions, risks and uncertainties is not exhaustive.
The forward-looking information contained in this news release is made as of the
date hereof and Santa Maria undertakes no obligation to update publicly or
revise any forward-looking statements or information, whether as a result of new
information, future events or otherwise, unless so required by applicable
securities laws.
FOR FURTHER INFORMATION PLEASE CONTACT:
Santa Maria Petroleum Inc.
Ron MacMicken
President & Chief Executive Officer
(416) 902-8099
ron@quetzalenergy.com
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