Seaview has a Reserve Committee comprised of independent board members, which reviews the qualifications and appointment of the independent reserve evaluators. The Committee also reviews the processes and technical data used to determine the reserves booked.
The independent reserves evaluation has been completed by Sproule and Associates Limited (“Sproule”) with an effective date of December 31, 2008, in a National Instrument 51-101 (“NI 51-101”) compliant report. Highlights of the report are summarized below:
-
Proven Developed Producing reserves have increased by 358% per share, to 3,941 mboe, a relative increase of 1,096% since December 31, 2007.
-
Total Proven reserves have increased by 344% per share, to 4,786 mboe, a relative increase of 1,064% since December 31, 2007.
-
Total Proven plus Probable reserves increased by 289% per share, to 7,256 mboe, a relative increase of 921% since December 31, 2007.
-
Achieved Q4-2008 average production of 1,794 boe/d, representing an increase of 367% per share as compared to Q4-2007 average production of 151 boe/d.
-
Reserve Life Index of 7.3 years on a Total Proven basis and 11.1 years on a Total Proven plus Probable basis using December 31, 2008 reserves, and Q4-08 production of 1,794 boe/d.
-
Total capital expenditures were $114.7 million, including changes in FDC total capital costs for the purpose of calculating FD&A costs were $126.2 million.
-
Achieved FD&A costs of $24.01/boe Proven and $17.94/boe Proven plus Probable (Including FDC).
-
Seaview completed three strategic acquisitions in 2008 adding 4,753 mboe of Total Proven plus Probable reserves, or 64% of the Total Proven plus Probable reserve additions in 2008.
-
Seaview’s acquisitions and drilling success replaced production by 11.3 times on a Proven basis and 16.3 times on a Proven plus Probable basis.
-
Seaview completed an active drilling program in 2008 which included drilling 18 wells (9.1 net) with an 89% success rate. Capital expenditures were $20.5 million directed towards drilling activity. Including changes to FDC, the total capital costs for the purpose of calculating F&D costs are $31.2 million. Compared to the unaudited financials reported on April 2, development capital has been restated from $24.1 million to $20.5 million to account for a revision in capital allocated to drilling activities that was related to acquisitions. As a result, the Company’s F&D costs have been recalculated relative to previous disclosure.
-
Achieved F&D costs of $13.63/boe Proven and $12.08/boe Proven plus Probable (including FDC).
-
Seaview enjoyed a very successful drilling program accounting for 2,475 mboe or 36% of the Total Proven and Probable reserve additions in 2008.
-
Seaview’s drilling success replaced production by 3.6 times on a Proven basis and 6.1 times on a Proven plus Probable basis.
Net asset value is calculated to be $2.19 per Class A share, using Total Proven plus Probable reserves value discounted at 10%, an increase of 75% relative to December 31, 2007.
The December 31, 2008, evaluation was prepared by Sproule utilizing the methodology and definitions as set out under NI 51-101. The reserves presented herein include the total Company’s working interest reserves before deduction of royalties and exclude royalty interest reserves as at December 31, 2008.
Table 1 NI 51-101
Summary of Oil and Gas Reserves
as of December 31, 2008
Forecast Prices and Costs
Proved |
|
|
Light and
Medium
Crude Oil
|
|
|
|
Light and
Medium
Crude Oil
|
|
|
|
|
|
|
|
|
|
|
|
Developed Producing |
1107.0 |
0 |
50.5 |
16,702 |
968.4 |
0 |
31.3 |
12,134 |
Developed Non‑Producing |
51.9 |
0 |
1.9 |
3,409 |
48.8 |
0 |
1.2 |
2,428 |
Undeveloped |
24.4 |
0 |
3.7 |
1,167 |
17.9 |
0 |
2.2 |
975 |
Total Proved |
1183.3 |
0 |
56.1 |
21,278 |
1035.1 |
0 |
34.7 |
15,537 |
Probable |
503.5 |
0 |
39.2 |
11,567 |
431.4 |
0 |
25.2 |
8,259 |
Total Proved plus Probable |
1686.9 |
0 |
95.3 |
32,845 |
1466.5 |
0 |
59.9 |
23,796 |
Table 2 NI 51-101
Summary of Net Present Values of Future Net Revenue
as of December 31, 2008
Forecast Prices and Costs
Proved |
Before Future Income Tax Expenses and Discounted at
|
Unit Value Before Income
Tax Discounted at
|
|
|
|
|
|
|
|
|
|
|
|
|
Developed Producing |
142,071 |
99,062 |
77,390 |
64,350 |
55,581 |
25.61 |
Developed Non‑Producing |
20,811 |
15,546 |
12,344 |
10,316 |
8,886 |
27.15 |
Undeveloped |
4,998 |
2,568 |
1,312 |
583 |
126 |
7.18 |
Total Proved |
167,881 |
117,086 |
91,045 |
75,249 |
64,594 |
24.88 |
Probable |
92,267 |
50,390 |
33,680 |
24,809 |
19,298 |
18.37 |
Total Proved plus Probable |
260,147 |
167,476 |
124,725 |
100,058 |
83,892 |
22.71 |
Proved |
After Future Income Tax Expenses and Discounted at
|
|
|
|
|
|
|
|
|
|
|
Developed Producing |
117,165 |
83,416 |
66,096 |
55,539 |
48,371 |
Developed Non‑Producing |
15,278 |
11,274 |
8,946 |
7,429 |
6,359 |
Undeveloped |
3,740 |
1,811 |
804 |
216 |
-151 |
Total Proved |
136,184 |
96,501 |
75,845 |
63,184 |
54,580 |
Probable |
67,907 |
36,922 |
24,427 |
17,760 |
13,609 |
Total Proved plus Probable |
204,091 |
133,424 |
100,272 |
80,944 |
68,189 |
Table 3 NI 51-101
Total Future Net Revenue Undiscounted
as of December 31, 2008
Forecast Prices and Costs
Total Proved Reserves |
|
|
|
|
|
|
|
|
329,371 |
62,522 |
87,036 |
5,219 |
6,707 |
167,881 |
31,697 |
136,184 |
Total Proved plus Probable |
519,760 |
101,481 |
136,245 |
12,982 |
8,896 |
260,147 |
56,057 |
204,091 |
Table 4 NI 51-101
Net Present Value of Future Net Revenue
By Production Group
as of December 31, 2008
Forecast Prices and Costs
Proved |
Future Net Revenue
Before Income Taxes
and (Discounted at 10%/Year)
|
Unit Value Before
Income Taxes
(Discounted at 10%/Year)
|
|
|
Light and Medium Crude Oil
(including solution gas and associated by-products) |
25,852 |
23.82 |
Heavy Crude Oil
(including solution gas and associated by-products) |
0 |
0 |
Natural Gas
(including associated by products) |
65,194 |
25.33 |
Proved plus Probable |
|
|
Light and Medium Crude Oil
(including solution gas and associated by-products) |
34,405 |
22.29 |
Heavy Crude Oil
(including solution gas and associated by-products) |
0 |
0 |
Natural Gas
(including associated by products) |
90,320 |
22.87 |
Table 5 NI 51-101
Summary of Pricing and Inflation Rate Assumptions
As of December 31, 2008 Forecast Prices and Costs
|
|
|
|
|
|
|
Edmonton Par Price
400 API
Crude Oil
|
Cromer Medium
29.30 API Crude Oil
|
|
Pentanes Plus
FOB Field Gate
|
|
|
|
|
|
|
|
|
|
|
|
|
Forecast |
|
|
|
|
|
2009 |
53.72 |
65.35 |
58.16 |
6.82 |
66.93 |
51.15 |
2.0 |
0.800 |
2010 |
63.41 |
72.78 |
66.23 |
7.56 |
74.54 |
54.25 |
2.0 |
0.850 |
2011 |
69.53 |
79.95 |
72.76 |
7.84 |
81.88 |
59.59 |
2.0 |
0.850 |
2012 |
79.59 |
86.57 |
79.65 |
8.38 |
88.66 |
64.53 |
2.0 |
0.900 |
2013 |
92.01 |
94.97 |
87.38 |
9.20 |
97.27 |
70.79 |
2.0 |
0.950 |
Thereafter |
Various Escalation Rates |
Net Asset Value per Share Information
Based on Sproule Reserves Evaluation as at December 31, 2008
($M except share amounts) |
Before Tax 10% Discount |
Proven
Developed
Producing |
Total
Proven
Reserves |
Total
Proven
plus Probable |
Value of Reserves |
77,390 |
91,045 |
124,725 |
Undeveloped Land (22,000 acres at $200 per acre) |
4,400 |
4,400 |
4,400 |
Estimated Net Debt as at December 31, 2008 |
(19,418) |
(19,418) |
(19,418) |
Total Net Assets |
62,372 |
76,027 |
109,707 |
Class A shares Outstanding (million)
as at December 31, 2008 |
50.00 |
50.00 |
50.00 |
Estimated Net Asset Value per Class A share |
$1.25 |
$1.52 |
$2.19 |
($M except share amounts) |
Before Tax 15% Discount |
Proven
Developed
Producing |
Total
Proven
Reserves |
Total
Proven
plus Probable |
Value of Reserves |
64,350 |
75,249 |
100,058 |
Undeveloped Land (22,000 acres at $200 per acre) |
4,400 |
4,400 |
4,400 |
Estimated Net Debt as at December 31, 2008 |
(19,418) |
(19,418) |
(19,418) |
Total Net Assets |
49,332 |
60,231 |
85,040 |
Class A shares Outstanding (million) as at December 31, 2008 |
50.00 |
50.00 |
50.00 |
Estimated Net Asset Value per Class A share |
$0.99 |
$1.20 |
$1.70 |
|
