TSX Venture: RTE
CALGARY, Nov. 7 /CNW/ - Result Energy Inc. is pleased to announce
substantial increases to natural gas reserves and daily production volumes.
The Corporation's recent reserve update indicates a 55% increase to
proven plus probable (P+PA) reserves from 2.2 million boe at December 31, 2005
to 3.4 million boe at September 30, 2006. Based on forecast pricing the net
present value of Result's P+PA reserves discounted at 5% is estimated at
$62.5 million and the Company's reserve life index (R.L.I.) is 7.3 years.
Reserve volumes and NPVs noted are the estimates provided by third party
reserve engineering firms. The estimated NPVs for the Company's oil & gas
reserves do not include the value of undeveloped land, seismic data, or income
tax pools.
Result's year-to-date finding and development costs were $9.75/boe on a
P+PA basis. Key additions have been booked at Worsley/Eureka in the Peace
River Arch project area and in the Greater Dodsland project area.
At Eureka Alberta, Result participated for a 50% working interest in two
new Devonian gas discoveries. Both discoveries were completion tested at rates
exceeding 1,000 mcfd gross - the first has been tied in and is on production
and the second is expected to be tied-in and producing early in 2007. In the
Dodsland project area, Result successfully drilled and tested a
4-well-per-section pilot down spacing program for Viking shallow gas. The
Company was also successful in drilling additional Viking gas prospects at
Druid and East Dodsland.
Average daily production increased 69% from 560 boed in December 2005 to
945 boed in September 2006. As of November 1st, Result's corporate production
was 1,253 boed with a further 1,450 mcfd (240 boed) tested and "behind pipe".
These behind pipe volumes are expected to be brought on over the next 2 to
3 months.
In commenting on the program success enjoyed to date, Mr. Bill Matheson,
President and CEO of Result Energy noted; "We are especially pleased with our
2006 FD&A costs, especially in light of the escalating costs for oilfield
supplies and services. This represents top performance and it validates our
ongoing strategy of growth via the drillbit. We have continued to generate
high quality prospects and because of the relationships we've developed
throughout the industry we have managed to procure all necessary services in
an on-time and cost effective manner."
Result will continue its aggressive exploration and development program
for the balance of 2006 and into 2007. In recent months, new 3D seismic has
been acquired on the Company's impact project at Kakwa, Alberta, where plans
are proceeding to drill a 3,400 meter deep basin gas test commencing in
Q1-2007.
At Modeste Creek, Alberta, field acquisition of additional 3-D seismic is
currently underway and the Company is negotiating a 5-section farm in
agreement with a senior energy trust to continue its Viking gas exploration
program. At least two wells are expected to be drilled on this play in 2007.
At Windfall, Alberta, the Company has committed to participate in a new
liquids-rich Devonian gas project. Seismic evaluation is currently being
completed, with at least two exploratory wells scheduled over the next six
months.
In aggregate, the Company has more than 70 drilling prospects in
inventory, including 45 development locations and 25 exploratory prospects.
Result is currently finalizing its full 2007 capital budget, details of which
will be released along with its third quarter financial statements in early
December.
Result Energy Inc. is a publicly traded Canadian energy Company involved
in the exploration and development of oil and gas properties in western
Canada. Result trades on the TSX Venture Exchange under the symbol "RTE".
Result currently has 47,658,138 common shares outstanding.
In the discussion of estimated oil and natural gas reserves, "Gross"
totals represent the Company's working interest share of reserves, before
deduction of royalty interests. Estimated Net Present Values ("NPV") are prior
to the provision for income taxes, interest, debt service charges, and general
and administrative expenses. Actual oil and natural gas reserves and future
production of the disclosed oil and natural gas reserves does not represent
the fair market value of these reserves.
Result has applied the industry standard of converting natural gas
volumes at six thousand cubic feet per barrel (6 mcf/bbl) of natural gas to
barrels of oil equivalence ("boe"). Boe units may be misleading, particularly
if used in isolation. "Mmcfe" is defined as a million cubic feet equivalent
(and is used herein to convert reserves of oil, natural gas, and natural gas
liquids to a common measure).
Investors are cautioned that this news release contains forward looking
information. Such information is subject to known and unknown risks,
uncertainties and other factors that could influence actual results or events
and cause actual results or events to differ materially from those stated,
anticipated or implied in the forward-looking information. Readers are
cautioned not to place undue reliance on forward-looking information, as no
assurances can be given as to future results, levels of activity or
achievements
The TSX Venture Exchange does not accept responsibility for the adequacy
and accuracy of this release.
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