Storm Resources Ltd. Provides Clarification to Information Provided in January 23, 2014 Press Release Announcing Acquisition ...
February 05 2014 - 9:18PM
Marketwired
Storm Resources Ltd. Provides Clarification to Information Provided
in January 23, 2014 Press Release Announcing Acquisition of Land in
Montney Formation of Umbach-Nig Area of North Eastern BC
CALGARY, ALBERTA--(Marketwired - Feb 5, 2014) - Storm Resources
Ltd. (TSX-VENTURE:SRX) ("Storm") wishes to clarify certain
information disclosed in the January 23, 2014 press release
regarding the acquisition of a 100% working interest in 29 sections
of land in the Umbach-Nig area (the "Acquisition"). The Acquisition
closed on January 31, 2014.
The clarifications relate to estimated DPIIP and recovery of
estimated DPIIP which were provided in the section entitled
"Details and Rationale for the Transaction" and are
clarified as follows:
- The DPIIP in the upper Montney formation for the 29 sections of
land acquired is estimated by Storm management to be 1.6 Tcf based
on data from existing wells on the 29 sections (seven vertical
wells plus two horizontal wells producing from the Montney
formation). Using the data from the existing wells, Storm
management estimates that the upper Montney formation is 52 metres
thick, has average porosity of 6%, and a reservoir pressure of
18,000 to 23,000 kPa (represents 21% of Storm's entire land
position in the Umbach-Nig area).
- The allocation of the purchase price is 11% to acquire cash
flow and reserves associated with the two producing Montney
horizontal wells, 30% for 20 sections of undeveloped land, and 59%
for nine sections of land where Storm management estimates 35
horizontal wells remain to be drilled in the upper Montney
formation based on the data from existing wells on the nine
sections (three vertical wells plus one horizontal well producing
from the upper Montney formation). This assumes four horizontal
wells are drilled per section which would recover 32% of DPIIP on
the nine sections if recovery from each horizontal well is similar
to the five Montney horizontal wells drilled by Storm in 2013 on
the adjacent Umbach South lands where ultimate recovery is
estimated by Storm management to be 4.4 Bcf gross raw gas for each
horizontal well.
READER ADVISORIES
Boe Presentation - For the purpose of calculating unit revenues
and costs, natural gas is converted to a barrel of oil equivalent
("Boe") using six thousand cubic feet ("Mcf") of natural gas equal
to one barrel of oil unless otherwise stated. Boe may be
misleading, particularly if used in isolation. A Boe conversion
ratio of six Mcf to one barrel ("Bbl") is based on an energy
equivalency conversion method primarily applicable at the burner
tip and does not represent a value equivalency at the wellhead. All
Boe measurements and conversions in this report are derived by
converting natural gas to oil in the ratio of six thousand cubic
feet of gas to one barrel of oil. Mmcf means 1,000 Mcf. Tcf means
1,000 Mmcf.
Discovered-Petroleum-Initially-in-Place ("DPIIP") - is defined
in the Canadian Oil and Gas Evaluation Handbook (COGEH) as the
quantity of hydrocarbons that are estimated to be in place within a
known accumulation. DPIIP is divided into recoverable and
unrecoverable portions, with the estimated future recoverable
portion classified as reserves and contingent resources. There is
no certainty that it will be economically viable or technically
feasible to produce any portion of this DPIIP except for those
portions identified as proved or probable reserves.
Forward-Looking Statements - The information in this press
release contains certain forward-looking statements. These
statements relate to future events or our future performance. All
statements other than statements of historical fact may be
forward-looking statements. Forward-looking statements are often,
but not always, identified by the use of words such as "seek",
"anticipate", "plan", "continue", "estimate", "expect", "may",
"will", "project", "predict", "potential", "targeting", "intend",
"could", "might", "should", "believe", "would" and similar
expressions. In particular, and without limitation, forward-looking
statements in this press release includes, but is not limited to:
ultimate recovery factors, planned drilling and development
activities, the potential number of drilling locations at Storm's
properties, estimates of Montney formation thickness, the number of
wells to be drilled per section, porosity, reservoir pressure,
anticipated benefits from the Acquisition, capital efficiencies and
commodity prices. These statements involve substantial known and
unknown risks and uncertainties, certain of which are beyond
Storm's control, including: the impact of general economic
conditions; industry conditions; changes in laws and regulations
including the adoption of new environmental laws and regulations
and changes in how they are interpreted and enforced; fluctuations
in commodity prices and foreign exchange and interest rates; stock
market volatility and market valuations; volatility in market
prices for oil and natural gas; liabilities inherent in oil and
natural gas operations; uncertainties associated with estimating
oil and natural gas reserves; competition for, among other things,
capital, acquisitions, reserves, undeveloped lands and skilled
personnel; incorrect assessments of the value of acquisitions;
changes in income tax laws or changes in tax laws and incentive
programs relating to the oil and gas industry; geological,
technical, drilling and processing problems and other difficulties
in producing petroleum reserves; and obtaining required approvals
of regulatory authorities. The intended use of proceeds of the
financings by Storm may change if the board of directors of Storm
determines that it would be in the best interests of Storm to
deploy the proceeds for some other purpose. Storm's actual results,
performance or achievement could differ materially from those
expressed in or implied by such forward-looking statements and,
accordingly, readers should not place undue reliance on the
forward-looking statements and information contained in this press
release. No assurances can be given that any of the events
anticipated by the forward-looking statements will transpire or
occur or, if any of them do, what benefits Storm will derive from
them.
Analogous Information - Certain information in this press
release may constitute "analogous information" as defined in
National Instrument 51-101 - Standards of Disclosure for Oil
and Gas Activities ("NI 51-101"), including, but not limited
to, information relating to the areas in geographical proximity to
the properties acquired in the Acquisition and production
information related to wells that are believed to be on trend with
the such properties. Management of Storm believes the information
is relevant as it helps to define the characteristics of the
properties in which Storm holds an interest pursuant to the
Acquisition. Storm is unable to confirm that the analogous
information was prepared by a qualified reserves evaluator or
auditor. Such information is not an estimate of the reserves or
resources attributable to lands held or to be held by Storm and
there is no certainty that the data and economics information for
the lands acquired by Storm will be similar to the information
presented herein. The reader is cautioned that the data relied upon
by Storm may be in error and/or may not be analogous to such lands
to be held by Storm.
Readers are cautioned that the foregoing list of factors is not
exhaustive. Additional information on these and other factors that
could affect the operations or financial results of Storm are
included in reports on file with applicable securities regulatory
authorities and may be accessed through the SEDAR website
(www.SEDAR.com) and on Storm's website (www.stormresourcesltd.com).
The forward-looking statements contained in this press release are
made as of the date hereof and Storm undertakes no obligation to
publicly update or revise any forward-looking statements or
information, whether as a result of new information, future events
or otherwise, unless required by applicable securities laws.
NEITHER THE TSX-VENTURE EXCHANGE NOR ITS REGULATION SERVICES
PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE
TSX-VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR
ACCURACY OF THIS RELEASE.
Storm Resources Ltd.Brian LavergnePresident and
CEO403-817-6145Storm Resources Ltd.Donald G.
McLeanCFO403-817-6145Storm Resources Ltd.Carol KnudsenManager,
Corporate Affairs403-817-6145www.stormresourcesltd.com