GEORGE TOWN, GRAND CAYMAN, Nov, 2 (Korea Bizwire) – Skyland Petroleum Group Limited ARBN 613 928 671 (ASX: SKP)(“Skyland” or the “Company”) is pleased to provide the prospective resource figures relating to the exploration potential within the Mirninsky Licence area located in the Sakha (Yakutia) Republic of the Russian Federation.
In addition to the encouraging estimate of reserves and resources for the licence area announced on 24 October 2016, Skyland received an addendum prospective resource report (dated 27 October 2016). The prospective resources are in addition to the contingent resources and reserves and the report supports the Company’s view that this licence area does indeed contain substantial exploration upside.
In conjunction with this release, Skyland will lodge the addendum prospective resource report and the reserves and contingent resources report with the ASX so that both technical reports are accessible to the public.
The work was completed by Gustavson Associates LLC of Boulder Colorado, USA and the estimates of prospective resources included in this announcement have been prepared in accordance with the definitions and guidelines set forth in the Australian VALMIN Code and SPE-PRMS methodology.
Mr. Mark Sarssam, Chief Operating Officer, commented:
“The Company would like to thank Gustavson Associates for its timely completion of the independent audit. The prospective resources are significant and support the view that the licence contains substantial upside in addition to the reserves and contingent resources previously reported.”
Skyland entered into a share purchase agreement (“SPA”) with a Russian entity known as ‘YATEC’ to acquire 100% of an oil and gas production and development asset located in the Sakha (Yakutia) Republic of East Siberia, Russian Federation.
The SPA relates to the purchase of the entire share capital of YATEC’s subsidiary, which holds 100% of the Sakha Licence, known as the Mirninsky Licence. The purchase price is USD100 million.
The licence covers an area of 2,452 km2 and contains four discovered oil and gas fields (one of which is on pilot production with oil sales within the region), several exploration discoveries and additional exploration targets.
Closing on the SPA is subject to certain conditions precedent being satisfied and/or waived by the Company: including the receipt by the Company of satisfactory due diligence investigations — which was completed last month — and final Skyland Board approval. Completion of the Transaction must occur before the end of 2016.
The Company is encouraged by the progress thus far and continues to work closely with YATEC on finalizing details of the SPA and reaching agreement on outstanding technical, commercial and transfer issues as outlined in the SPA.
Skyland Petroleum Group Limited is an oil and gas exploration and production company listed on the Australian Securities Exchange (“ASX”) and primarily focused on projects in Russia, Central Asia and the Caucasus. The company aims to create and maximize shareholder value by acquiring and developing a portfolio of productive oil and gas assets with significant unrealized technical and commercial upside at attractive acquisition metrics.
This announcement may contain “forward-looking information”. Such forward-looking statements reflect the current views of the Company with respect to future events and are subject to certain assumptions. These forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of the Company. The “forward looking statements” contained herein speak only as of the date of this announcement and, unless required by applicable law, regulation or ASX listing rules, the Company undertakes no obligation to publicly update or revise such information; whether as a result of new information, future events or otherwise. No representation, warranty or assurance (express or implied) is given or made in relation to any forward-looking statement. No representation, warranty or assumption (express or implied) is given in relation to any underlying assumption or that any forward looking statement shall be achieved. Given these uncertainties any reader of this announcement is cautioned not to place undue reliance on any such forward looking statements.
The prospective resources figures provided in this report were compiled by Gustavson Associates LLC (the “Report”). Unless otherwise stated in this announcement, the information provided has been prepared in accordance with the standard definitions set out by the Society of Petroleum Engineers, Petroleum Resource Management System (PRMS) and were prepared by a “qualified petroleum reserves and resources evaluator” employed by Gustavson Associates LLC. The Report is dated 27 October 2016 and the figures presented here were prepared using the probabilistic method. The figures are also unrisked and do not include the chance of exploration success. Skyland does not currently have any economic interest in the Mirninsky Licence, but the Company would assume an economic interest in the Mirninsky Licence were the proposed transaction with YATEC to complete. Reserves and resources are summed using arithmetic summation. The prospective resources are not yet discovered and no economic cut-off has been applied. Barrels of oil equivalent (“BOE’s”) may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1bbl was used and is based on an energy equivalency conversion method primarily applicable at the burner tip and does not necessarily represent a value equivalency at the wellhead. The estimated quantities of petroleum that may potentially be recovered by the application of a future development project relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons.
For more information, please contact:
Skyland Petroleum Group Limited
Investor Relations Manager
Source: Skyland Petroleum Limited via Marketwired