Lundin Petroleum updates its reserves, contingent resources
STOCKHOLM, Sweden -- Lundin Petroleum has announced that as of December 31, 2013, its net proven and probable working interest reserves (2P Reserves) are 194.1 MMboe, its best estimate (2C) Contingent Resources, excluding the Johan Sverdrup field, are 342 MMboe, and the production forecast for 2014 is between 30,000 and 35,000 boepd with forecast 2015 average production expected to be approximately 50,000 boepd.
Lundin Petroleum is predominantly an oil company with 92 percent of its 2P Reserves being oil and 89 percent of the 2P Reserves being located in OECD regions.
The 2P Reserves have been positively impacted by Lundin Petroleum's main producing assets, the Alvheim and Volund fields offshore Norway. During 2013 the Volund field continued to deliver better than expected reservoir performance, and the Alvheim field volumes have increased as a result of two additional development locations maturing from Contingent Resources to 2P Reserves.
Lundin Petroleum has further assets classified as Contingent Resources with "Best Case", or 2C, values excluding the Johan Sverdrup field of 342 MMboe in aggregate of which oil accounts for 60 percent.
Apart from the Salina discovery in Norway these Contingent Resource estimates have been evaluated either by ERC Equipoise Limited (ERCE) or internally by a qualified reserves auditor in accordance with NI 51-101 standards of disclosure. The Johan Sverdrup field contains gross Contingent Resources of between 1,800 and 2,900 MMBoe as disclosed by pre-unit operator Statoil. The Johan Sverdrup field is situated in licenses PL501, PL502 and PL265 in Norway. Lundin Petroleum has a 40 percent interest in PL501 and a 10 percent interest in PL265.
Lundin Petroleum's forecast production for 2014 is between 30,000 to 35,000 boepd. The production from Norway represents approximately 72 percent of forecast 2014 production and oil represents approximately 83 percent. Lundin Petroleum expects the 2015 production to be approximately 50,000 boepd with full production from the Brynhild field and the start-up of the Bøyla, Bertam and Edvard Grieg fields in 2015.
The 2P Reserves are based upon a third party independent audit conducted by ERCE. The 2P Reserves have been calculated using 2007 Petroleum Resources Management System (SPE PRMS) Guidelines of the Society of Petroleum Engineers (SPE), World Petroleum Congress (WPC), American Association of Petroleum Geologists (AAPG) and Society of Petroleum Evaluation Engineers (SPEE) and have been reviewed for compliance with the Canadian Oil and Gas Evaluation Handbook (COGEH) and the Canadian National Instrumental 51-101 Standards of Disclosure for Oil and Gas Activities. The 2P Reserves were calculated using an oil price of $100 per barrel in 2014, with prices and costs escalating at 2 percent per annum.
Ashley Heppenstall, president and CEO of Lundin Petroleum, comments, "In the next two years Lundin Petroleum will more than double its production to over 75,000 boepd with the start-up of production from the Brynhild, Bøyla, Bertam and Edvard Grieg fields. We have today reserves and contingent resources in excess of one billion barrels of oil equivalent and our reserve position will increase by over three fold on submission of the Johan Sverdrup development plan expected by the end of 2014. I am confident that our 2014 appraisal and exploration drilling programs including wells on Luno II, Gohta and Tembakau will result in further increases to our reserve and resource base."