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MAGP Magnolia Pet

0.30
0.00 (0.00%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Magnolia Pet LSE:MAGP London Ordinary Share GB00B63QSF76 ORD SHS 0.1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 0.30 0.20 0.40 0.00 00:00:00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
0 0 N/A 0

Magnolia Petroleum Plc Increase in Value of Reserves

25/04/2017 7:00am

UK Regulatory


 
TIDMMAGP 
 
Magnolia Petroleum Plc / Index: AIM / Epic: MAGP / Sector: Oil & Gas 
 
25 April 2017 
 
             Magnolia Petroleum Plc ('Magnolia' or 'the Company') 
 
                         Increase in Value of Reserves 
 
Magnolia Petroleum Plc, the AIM quoted US onshore focused oil and gas 
exploration and production company, is pleased to announce an upgrade in the 
value of its net proved developed producing reserves ('PDP') to US$4,300,000 
across the Company's leases in proven US onshore formations such as the 
Woodford and Mississippi Lime, Oklahoma, and the Bakken and Three Forks Sanish, 
North Dakota. 
 
On 15 March 2017, the Company announced the results of an independent reserves 
report, which included: 
 
  * 112% increase in total net PDP oil and condensate reserves to 282.686 Mbbl 
    (1 July 2016: 133.31 Mbbl of oil and condensate) 
 
  * 303% increase in total net PDP gas reserves to 2,343.116 MMCF (1 July 2016: 
    580.67 MMcf gas) 
 
  * Increase in the value (NPV9) of total net PDP reserves to US$4,026,000 (1 
    July 2016: US$3,445,180) 
 
    Today's upgrade in the value of Magnolia's total net PDP reserves to 
    US$4,300,000 from US$4,026,000 in March 2017 follows a revaluation of the 
    operating costs and production profile of three wells in Oklahoma.  Among 
    these three wells is the Magnolia-operated and 100% owned Roger Swartz #1, 
    which is producing from the Mississippi Lime formation, Oklahoma. 
    Following a successful 'refrac', the operating costs of the well have been 
    reduced, resulting in a significant increase in the value of Roger Swartz 
    to US$205,000 from US$50,000 previously.  The remainder of the value 
    increase is due to production at the Chesapeake Energy-operated Gray 
    7-27-12 1H and Gray 7-27-12 2H wells, in which Magnolia holds a 1.86% net 
    revenue interest, exceeding expectations. 
 
    Rita Whittington, COO of Magnolia, said, "This upgrade to the valuation of 
    our PDP reserves to US$4,300,000 provides further asset backing to 
    Magnolia's current market capitalisation.  Importantly, this valuation only 
    covers proved developed producing and proved developed non-producing 
    reserve classes.  It does not include other reserve categories such as 
    proved shut-in, proved undeveloped, probable and possible reserve classes 
    as well as Magnolia's interests in undeveloped acreage.  We therefore 
    believe the value of our portfolio of leases in the US onshore formations 
    is far greater than today's reported figure.  As activity continues to pick 
    up and our participation in new wells alongside leading operators 
    increases, we are confident that the underlying value of our portfolio will 
    be realised." 
 
    Summary Table of Magnolia's Total Net PDP and proved developed 
    non-producing ('PDNP') Reserves as at 24 April 2017: 
 
                                    Net                 PV9 
 
State         Reserve             BO         MCF       US$M 
              Category 
 
Oklahoma      PDP            124,773   2,207,617     $2,730 
 
Oklahoma      PDNP               833           0         $3 
 
North Dakota  PDP            157,913     135,499     $1,570 
 
Total                        283,519   2,343,116     $4,300 
 
NPV9 valuations are based on the bank's price deck as of January 2017 and take 
into account the future net cash flow which is defined as future net revenue, 
less estimated future net OPEX (well operating cost and production taxes) and 
future net capital.  The total net PDP reserves are those defined as natural 
gas and liquid hydrocarbon reserves to Magnolia's interest after deducting all 
royalties, overriding royalties, and reversionary interests owned by outside 
parties that become effective upon pay-out of specified monetary balances.  All 
reserves estimates have been prepared using standard engineering practices 
generally accepted by the petroleum industry and conform to the guidelines 
adopted by the 2007 SPE/SPEE/WPC PRMS Guidelines. 
 
The information contained in this announcement regarding the reserves analysis 
has been reviewed and approved by Mike Mabry on behalf of Sycamore Resources. 
 Mr Mabry has over 30 years of relevant experience in the oil industry and has 
a B.S. in Petroleum Engineering from the University of Tulsa.  He has 
previously served as Chair of the SPE Improved Oil Recovery Symposium, 
presiding over 700 engineers from 65 counties.  Over the course of his career, 
Mr Mabry has held the position of Senior Petroleum Engineer at Apache 
Corporation, Petrohawk Energy and MAPCO and is currently Managing Director of 
Sycamore Resources in Tulsa, Oklahoma. 
 
The information contained within this announcement constitutes inside 
information stipulated under the Market Abuse Regulation (EU) No. 596/2014. 
 
                                  ** ENDS ** 
 
Glossary 
 
'M' means Thousand 
 
'MBO' means Thousand Barrels of Oil 
 
'Mcfd' means Thousand Cubic Feet per Day 
 
'MM' means    million (thousand thousand not million million), as used in 
oilfield and heat content units such as MMSTB and MMBtu 
 
'MMBbl' means Million barrels 
 
'MMcfd' means Million Cubic Feet per Day 
 
'NRI' means Net Revenue Interests 
 
'Proved Reserves' means those quantities of petroleum which, by analysis of 
geological and engineering data, can be estimated with reasonable certainty to 
be commercially recoverable, from a given date forward, from known reservoirs 
and under current economic conditions, operating methods, and government 
regulation - Proved reserves can be categorized as developed or undeveloped 
 
'Probable reserves' are those unproved reserves which analysis of geological 
and engineering data suggests are more likely than not to be recoverable. In 
this context, when probabilistic methods are used, there should be at least a 
50% probability that the quantities actually recovered will equal or exceed the 
sum of estimated proved plus probable reserves 
 
'Possible Reserves' are those unproved reserves which analysis of geological 
and engineering data suggests are less likely to be recoverable than probable 
reserves. In this context, when probabilistic methods are used, there should be 
at least a 10% probability that the quantities actually recovered will equal or 
exceed the sum of estimated proved plus probable plus possible reserves 
 
Reserve Status Categories 
 
'Unproved Reserves' are based on geologic and/or engineering data similar to 
that used in estimates of proved reserves; but technical, contractual, 
economic, or regulatory uncertainties preclude such reserves being classified 
as proved. Unproved reserves may be further classified as probable reserves and 
possible reserves 
 
Reserve status categories define the development and producing status of wells 
and reservoirs 
 
'Developed reserves' are expected to be recovered from existing wells including 
reserves behind pipe. Improved recovery reserves are considered developed only 
after the necessary equipment has been installed, or when the costs to do so 
are relatively minor. Developed reserves may be subcategorised as producing or 
non-producing. 
 
'Producing reserves' are expected to be recovered from completion intervals 
which are open and producing at the time of the estimate. Improved recovery 
reserves are considered producing only after the improved recovery project is 
in operation. 
 
'Non-producing reserves' include shut-in and behind-pipe reserves. Shut-in 
reserves are expected to be recovered from (1) completion intervals which are 
open at the time of the estimate but which have not started producing, (2) 
wells which were shut-in for market conditions or pipeline connections, or (3) 
wells not capable of production for mechanical reasons. Behind-pipe reserves 
are expected to be recovered from zones in existing wells, which will require 
additional completion work or future recompletion prior to the start of 
production. 
 
'Undeveloped reserves' are expected to be recovered: (1) from new wells on 
undrilled acreage, (2) from deepening existing wells to a different reservoir, 
or (3) where a relatively large expenditure is required to (a) recomplete an 
existing well or (b) install production or transportation facilities for 
primary or improved recovery projects. 
 
                                 * * ENDS * * 
 
For further information on Magnolia Petroleum Plc visit 
www.magnoliapetroleum.com or contact the following: 
 
Steven Snead                 Magnolia Petroleum Plc         +01 91 8449 
                                                            8750 
 
Rita Whittington             Magnolia Petroleum Plc         +01 91 8449 
                                                            8750 
 
Jo Turner / James Caithie    Cairn Financial Advisers       +4420 7213 0880 
                             LLP 
 
Colin Rowbury                Cornhill Capital Limited       +4420 7710 9610 
 
Lottie Brocklehurst          St Brides Partners Ltd         +4420 7236 1177 
 
Frank Buhagiar               St Brides Partners             +4420 7236 1177 
                             Ltd 
 
Notes 
 
Magnolia Petroleum Plc is an AIM quoted, US focused, oil and gas exploration 
and production company.  Its portfolio includes interests in 212 producing and 
non-producing assets, primarily located in the highly productive Bakken/Three 
Forks Sanish hydrocarbon formations in North Dakota as well as the oil rich 
Mississippi Lime and the substantial and proven Woodford and Hunton formations 
in Oklahoma. 
 
Summary of Wells 
 
Category                                                Number of wells 
 
Producing                                                           156 
 
Being drilled / completed                                            13 
 
Elected to participate / waiting to                                  43 
spud 
 
TOTAL                                                               212 
 
 
 
END 
 

(END) Dow Jones Newswires

April 25, 2017 02:00 ET (06:00 GMT)

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