First Calgary Petroleums Releases Algeria Reserves Evaluation

 

    CALGARY, June 10 /CNW/ - First Calgary Petroleums Ltd. (FCP) today

announced positive reserve results from its ongoing appraisal drilling in

Algeria. The independent engineering firm, DeGolyer and MacNaughton of Dallas,

Texas, has estimated the gross proved, probable and possible reserves of FCP's

Ledjmet Block 405b to be more than 5.7 trillion cubic feet equivalent (TCFe)

of recoverable natural gas reserves. Of this total, proved reserves are

708 billion cubic feet equivalent (BCFe) and proved plus probable reserves are

2.4 TCFe. The gross sales gas, condensate and natural gas liquids reserve

volumes are as follows:

 

   

    -------------------------------------------------------------------------

                                            Gross Recoverable Reserves

    -------------------------------------------------------------------------

                                       Sales Gas     Condensate      Total

                                                      and LPG

    ------------------------------------------------------------------------

                                          BCF           MBBLS       BCFe (2)

    ------------------------------------------------------------------------

    Proved undeveloped                    530          29,645            708

    ------------------------------------------------------------------------

    Probable (1)                          711         161,873          1,682

    ------------------------------------------------------------------------

    Proved plus Probable (1)            1,241         191,518          2,390

    ------------------------------------------------------------------------

    Possible (1)                        2,607         123,782          3,350

    ------------------------------------------------------------------------

    Proved, Probable and Possible (1)   3,848         315,300          5,740

    ------------------------------------------------------------------------

 

    FCP's net proved and probable reserves and the estimated future net

revenue and present worth values are as follows:

 

    -------------------------------------------------------------------------

                              FCP Net Reserves (3)

                           ---------------------------   Future Net Revenue

                              Sales Condensate  Total   and Present Worth (4)

                               Gas   and LPG                 U.S. $ 000

    -------------------------------------------------------------------------

                               BCF     MBBLS  BCFe (2)    PW (0%)    PW (10%)

    -------------------------------------------------------------------------

    Proved undeveloped        108.8    6,081   145.3      $441,406   $100,516

    -------------------------------------------------------------------------

    Probable (1)               66.0   20,889   191.3      $771,698   $271,624

    -------------------------------------------------------------------------

    Proved plus Probable (1)  174.8   26,970   336.6    $1,213,104   $372,140

    -------------------------------------------------------------------------

   

 

      (1) Probable and possible reserves are unrisked.

      (2) Gas equivalence calculated at 1 bbl (equal sign) 6 mcfe.

      (3) FCP's net reserves allocation is calculated annually based upon a

          sliding scale formula that considers capital investment, production

          levels and product prices. Accordingly, the net allocation can vary

          annually and will be dependent upon the actual costs, production

          levels and product prices realized.

      (4) Escalating product prices assumed over field life.

 

    To date, three wells have been drilled on Ledjmet Block 405b that include

MLE-1, MLE-2 and MZL-1. The MLE-1 and MLE-2 wells, located on the same

geological structure, successfully tested gas and condensate from multiple

geological horizons totalling 53,200 barrels of oil equivalent per day on a

combined basis.

 

    Additional Drilling Planned

 

    Based on the wells drilled to date and the 3D seismic, the structure has

been mapped to be in excess of 100 km2 in size. Immediate plans are to drill

three additional appraisal wells to further delineate the MLE structure.

Enafor Rig No. 29 is presently rigging up on the MLE-3 well location and will

commence drilling in the next few days. The MLE-3 well will be immediately

followed by the MLE-4 and MLE-5 wells. These wells are expected to move the

majority of the reserves in the possible category to the proved and probable

categories.

    "The Ledjmet Block, held 100 per cent by FCP and Sonatrach, the Algerian

national oil company, is emerging as a world class gas and condensate field

far exceeding our original expectations," explains Richard Anderson, President

and CEO of FCP. "The field has all the required elements: extensive reserves

at high working interest, large production rates, and excellent market

opportunities for the products to Europe." Algeria provides 15% of the

continent's natural gas consumption and some 29% of Europe's gas imports.

European consumption of natural gas is projected to increase approximately

46 per cent by 2010 while Algeria is looking to increase its production

capacity by 40 per cent by 2005.

    FCP is well positioned to take advantage of Algeria's planned gas

production expansion plans. With the Ledjmet reserves supporting commercial

exploitation, the Company has initiated project development and financing

discussions with parties which will not have a diluting effect for FCP's

shareholders. The Company is in the enviable position of having a large field

close to existing pipelines with readily available markets.

 

    Seismic Programs Continue

 

    FCP also reports the acquisition of 600 km2 of 3D seismic data,

immediately adjacent to and west of the MLE pool, is proceeding. FCP expects

to identify drilling locations on two large separate mapped structures by the

fourth quarter of 2003. In addition, a 240 km 2D seismic acquisition program

on the Yacoub Block 406a has been completed and processing and interpretation

are underway to identify a second drilling location on the Block.

 

    First Calgary Petroleums Ltd. is a Canadian oil and gas exploratory

company that is actively engaged in international exploration and development

activities, primarily in North Africa. The company's common shares trade on

the TorontoStock Exchange in Canada (FCP) and on the Alternative Investment

Market of the London Stock Exchange in the UK (FPL).

 

    This news release includes statements about expected future events and

financial results that are forward looking in nature and subject to risks and

uncertainties. FCP cautions that actual performance may be affected by a

number of factors, many of which are beyond its control. Future events and

results may vary substantially from what First Calgary Petroleums Ltd.

currently foresees.

 

    For further information: Richard G. Anderson, President and CEO, First

Calgary Petroleums Ltd., Tel (403) 264-6697; European contact: Carina Corbett,

4C Communications, Tel +44 (0) 20 7907 4761; Website: www.fcpl.ca

    (FCP. FPL)



END