Pulse Oil Corp. is definitely upbeat following an independent resource assessment of the company’s Nisku Enhanced Oil Recovery project in Bigoray, Alta.
“The Sproule Resource Assessment is a positive independent commercial confirmation for our Bigoray Nisku Enhanced Oil Recovery project,” said Drew Cadenhead, Chief Operating Officer of Pulse in a company press release. “Although this assessment used a more conservative approach to Petroleum Initially in-Place (PIIP) compared with the PIIP estimates of the Alberta Energy Regulator, we are excited to see that even this more conservative approach resulted in a strong endorsement for the project.”
With an independent un-risked high case upside estimated at over 8 million boe’s of contingent resources (92% oil), “the opportunity to move forward with our EOR project to bring on stream substantial cashflow while targeting to recover those types of oil volumes without drilling a well, creates a substantial opportunity to enhance value for Pulse and our shareholders,” said Cadenhead.
The Resource Assessment focussed exclusively on two Nisku pools only in the Bigoray area, and included just 2,720 acres of Pulse’s 44,720 acre core area holdings which includes 14,000 acres at Bigoray alone. Future evaluations may be done on Pulse’s Mannville, Cardium and Pekisko formations that are thought to also provide significant growth opportunities for the Company as well as additional Nisku assets/pools held within Pulse’s existing holdings.
The estimate, completed by Sproule Associates Limited, an independent qualified reserves evaluator, includes the Bigoray EOR project potential only, and is in addition to the previously disclosed baseline independently assessed reserves in the company’s core areas at Bigoray and Queenstown.
The Resource Assessment was prepared in accordance with National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities of the Canadian Securities Administrators (NI 51-101) and the Canadian Oil and Gas Evaluation Handbook. Sproule assessed a best estimate Discovered Petroleum Initially in-Place of 23.292 million barrels of oil within Pulse’s 100% controlled Nisku D and Nisku E Pools, which Pulse views as being conservative.
In addition, the Resource Assessment provides estimates categorized as “high”, “best” and “low” for contingent resources associated with the Bigoray EOR project on the two pools, with the unrisked high estimate being 8.07 million boe (92.6% oil), a best estimate of 6.136 million boe (91.3% oil) and a low estimate of 3.668 million boe (89.1% oil).
Additionally, the Resource Assessment prepared by Sproule calculated risked contingent resources where the risked assessment assigned a 77% chance of Pulse proceeding with the EOR project and resulting in a best estimate of risked contingent resources net to Pulse of 4.694 million boe (91.2% oil).
“Our goal is to make this project happen in 2018 and with the oil price market appreciating heading into 2018,” said Cadenhead, “the economics of this EOR project and return for shareholders continue to look more and more attractive alongside improving oil prices.”
The Resource Assessment is based on the results from 17 wells and, where available, core data. Where core was not available, the assessment considered log data.
(Pulse Oil Corp.)