Great Eastern Energy Corp Ltd Competent Persons Report (7477R)

TIDMGEEC

RNS Number : 7477R

Great Eastern Energy Corp Ltd

08 July 2022

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ('MAR') which has been incorporated into UK law by the European Union (Withdrawal) Act 2018. Upon the publication of this announcement via Regulatory Information Service ('RIS'), this inside information is now considered to be in the public domain.

8 July 2022

Great Eastern Energy Corporation Limited

("Great Eastern" or "the Company")

Competent Persons Report ("CPR")

Great Eastern Energy Corporation Limited (LSE: GEEC), the fully integrated, pioneering Indian Coal Bed Methane ("CBM") Company, is pleased to announce an upgrade in its reserves and resources at its Raniganj (South) block. The CPR has been provided by the leading independent experts, DeGolyer and McNaughton ("D&M").

D&M has made the following assessment of the CBM and Shale gas reserves and resources in the Raniganj (South) block:

 
 Classification       Category      Shale Gas    CBM Resources   Total Resources 
                                     Resources       (TCF)            (TCF) 
                                       (TCF) 
  Original gas 
     in place 
    ("OGIP")*       Low estimate       1.39         2.62**            4.01 
                  ---------------  -----------                  ---------------- 
           Best estimate               3.51                           6.13 
 --------------------------------  -----------                  ---------------- 
           High estimate               8.00                           10.62 
 --------------------------------  -----------                  ---------------- 
 
 
 
 Classification    Resource    Category      Gross               Total Future Pre-Tax Net 
                      Type                 Recoverable                   Cash Flow 
                                               Gas                      ($ Million) 
                                         ------------- 
 
                                             (BCF)       Undiscounted   Discounted    Discounted 
                                                                         at 5% per       at 10% 
                                                                         annum ("PV    per annum 
                                                                            5%")       ("PV 10%") 
                                         -------------  -------------  ------------  ------------ 
    Reserves*         CBM         1P         161.47       $1,478.43       $914.31       $594.93 
                  ----------  ---------  -------------  -------------  ------------  ------------ 
                                  2P         357.20       $3,260.31      $1,979.19     $1,257.83 
 ---------------------------  ---------  -------------  -------------  ------------  ------------ 
                                  3P         612.10       $5,723.17      $3,540.17     $2,295.99 
 ---------------------------  ---------  -------------  -------------  ------------  ------------ 
 
   Contingent 
    Resources*        CBM         1C         194.30       $1,615.45       $687.35       $319.39 
                  ----------  ---------  -------------  -------------  ------------  ------------ 
                                  2C         517.49       $4,662.32      $2,090.35     $1,039.07 
 ---------------------------  ---------  -------------  -------------  ------------  ------------ 
                                  3C         912.64       $8,526.27      $4,011.90     $2,096.20 
 ---------------------------  ---------  -------------  -------------  ------------  ------------ 
 
   Prospective       SHALE 
    Resources*        GAS         1U         551.25       $3,683.13      $2,406.10     $1,768.36 
                  ----------  ---------  -------------  -------------  ------------  ------------ 
                                  2U        1032.63       $7,098.97      $4,628.80     $3,227.12 
 ---------------------------  ---------  -------------  -------------  ------------  ------------ 
                                  3U        2,103.45      $15,113.90     $9,614.07     $6,551.54 
 ---------------------------  ---------  -------------  -------------  ------------  ------------ 
 

*As of 31 March 2022

**Marginally increased from 2619.50 BCF (2.62 TCF) to 2622 BCF (2.62 TCF)

TCF - Trillion Cubic Feet

BCF - Billion Cubic Feet

D&M's CPR updates the previous CPR on CBM and Shale gas volume estimates produced by Advance Resources International, Inc. which was announced on 15 November 2018.

-- Best estimate aggregated OGIP of 6.13 TCF remains unchanged

-- High estimate aggregated OGIP of 10.62 TCF is 14.84% higher than the previously reported 9.25 TCF

-- 3P+3C+3U volume of 3,628.19 BCF, i.e. 3.63 TCF is 21.41% higher than the previously reported 2.99 TCF

-- Undiscounted value of 3P+3C+3U: $29.36 billion is 113.16% higher than the previously reported $13.78 billion

-- PV 5% value of 3P+3C+3U: $17.17 billion

-- PV 10% value of 3P+3C+3U: $10.94 billion is 154.01% higher than the previously reported $4.31 billion

1P and 2P reserves have reduced due to delays in field development activities caused by the Covid-19 outbreak lockdowns, and the company was forced to significantly reduce the gas production by choking the production wells due to a decrease in gas offtake during that period.

These are the primary reasons for the recent shift in reserves, but there has been a positive effect on both the total OGIP which has increased by 1.37 TCF in the high estimate, and the potentially recoverable volumes (3P + 3C + 3U) which have increased by 639.79 BCF.

The CBM OGIP remains the same at 2.62 TCF, and the Shale gas OGIP has increased from 6.63 TCF to 8 TCF in the high estimate.

The 3P+3C volumes, related to CBM, have significantly increased from 1299.10 BCF to 1,524.74 BCF, an increase of 17.37%. This has resulted in the potential recovery rate increasing from 49.59% to 58.15% of the CBM OGIP of 2.62 TCF.

PV 10% value of 3P+3C: $4.39 billion is 187.94% higher than the previously reported $1.53 billion.

The 3U volume, related to Shale gas, has also significantly increased from 1689.30 BCF to 2103.45 BCF, an increase of 24.52%. The has resulted in the potential recovery rate increasing from 25.48% of the previous Shale gas OGIP of 6.63 TCF to 26.29% of the increased Shale gas OGIP of 8 TCF.

PV 10% value of 3U: $6.55 billion is 135.42% higher than the previously reported $2.78 billion.

Prashant Modi, Managing Director & CEO of Great Eastern, said:

"We are delighted to announce this new CPR which reconfirms our OGIP for our Raniganj (South) block, in the best estimate, of 6.13 TCF and an uplift in the OGIP, in the high estimate, to 10.62 TCF along with a significant increase in the value and recovery rate. With an undiscounted value of over $29 billion and a discounted value of between $11 billion to $17 billion, we are both humbled and excited about the fantastic value accreditation and the significant CBM and Shale gas value potential that remains to be unlocked at Great Eastern.

We believe that the Shale gas resources can be explored and developed cost effectively as we have been able to do with our CBM play. With the GAIL pipeline installation nearby progressing well and the demand for natural gas growing, both in India and globally, it blends very well with the overall vision, strategy, and the growth potential of the Company as it offers the ability to deliver additional future production volumes to new customers and markets.

Our QHSE and CSR policies along with our commitment to sustainable practices all help us provide an alternative and cleaner source of energy to our customers that improves the air quality of the region and contributes towards the reduction of greenhouse gas emissions. Together with our asset base, we believe our sustainable policies and philanthropic activities allow the integration of social and business goals that will help us secure an ongoing competitive advantage in the longer term."

About the Company www.geecl.com

A fully integrated gas production, development, and exploration Company in India. Gas is being produced from the Raniganj (South) block in West Bengal, which covers 210 sq. km with 10.62 TCF of Original gas in place. The Company's second license is the Mannargudi block in Tamil Nadu, which covers 667 sq. km with 0.98 TCF of Original gas in place.

   About D&M    www.demac.com 

D&M is one of the industry's leading experts in evaluations of unconventional resources. D&M offers a diverse range of services supporting the evaluation and development of unconventional resources. D&M's involvement in unconventional resources started in the U.S. in 1982, and since then D&M has gathered significant experience and working knowledge in almost every unconventional basin across the world. D&M annually evaluates reserves in more than 50,000 unconventional wells in North America alone. In addition to reserves and resource evaluations, recent projects include rate-transient analysis, fracture modelling, reservoir characterization, and modelling studies in various plays in North America, Argentina, Kuwait, Bahrain, Algeria, China, and Australia. In particular, D&M was involved in the exploration, well completion design, and execution of the world's first offshore unconventional horizontal well pilot in Bahrain.

 
 For further information please 
  contact: 
 
 Great Eastern Energy Corporation       www.geecl.com 
  Limited 
 
                                                          [phone] 
 Yogendra Kr. Modi      Executive Chairman                           0470 
 Prashant Modi          Managing Director & CEO 
                                                         [phone] 
 Jonathan Keeling       VP - Investor Relations                       522 
 
                                                          [phone] 

 SP Angel Corporate Finance LLP                                      0470 
 
 Rob Rees 
 Richard Hail 
 Caroline Rowe 
 
 
 
Explanatory Notes: 
 Reserves are those quantities of petroleum which are anticipated 
 to be commercially recovered from known accumulations from a given 
 date forward. 
 Contingent resources are those quantities of petroleum which 
 are estimated, as of a given date, to be potentially recoverable 
 from known accumulations. 
 Prospective Resources are those quantities of petroleum estimated, 
 as of a given date, to be potentially recoverable from undiscovered 
 accumulations by application of future development projects. 
 

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July 08, 2022 02:00 ET (06:00 GMT)