Ryder Scott engaged in a preliminary review of all the newly available data from the deepening of the Shenandoah-1 well, including the logs and cores. Based on Ryder Scott's review of these data, the Ryder Scott Letter states, "This work supports the resource estimates and conclusions presented in the Report. The preliminary analyses indicate that both the Lower Kyalla and Middle Velkerrie organic rich shales likely contain significant amounts of adsorbed gas. In the deepened Shenandoah #1 Well, the mud-log recorded very high gas readings while drilling through both shale intervals and gas was observed in the drilling mud. High mud-log gas readings and high resistivities were also observed from the top of the Moroak Sandstone (1,718 meters) down to approximately 1,806 meters at which point both the gas readings and log resistivities dropped. Preliminary log analyses suggest the possibility of a gas/water contact at that point and the possible existence of a conventional gas accumulation in the Moroak Sandstone in the well."
The Letter also includes various cautionary notes regarding the uncertainty and preliminary nature of the findings and data at this stage in the exploration of the properties.
Falcon's interest in the Beetaloo Basin consists of four Exploration Permits (the "Permits") comprising approximately 28,200 square kilometers (7 million gross acres), covering the majority of the Beetaloo Basin and basin margin highs. Through its wholly owned Australian subsidiary, Falcon Oil & Gas
Their resource evaluation of the Beetaloo Basin is as follows:
[Tables 9 and 10 from the July 1, 2009 Ryder Scott Report. For a definition of “Low” “Best” and “High,” see Section 5 of the Report titled “Definitions of Resources and Reserves,” item 5.3.5 titled “Uncertainty Category.” The total oil and gas resource is an arithmetic summation of the multiple estimates of the individual reservoir resources. Under Section 5.2 of COGEH: Undiscovered Petroleum Initially-In-Place (equivalent to undiscovered resources) is that quantity of petroleum that is estimated, on a given date, to be contained in accumulations yet to be discovered. 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. Prospective resources have both an associated chance of discovery and a chance of development. There is no certainty that any portion of the undiscovered resources will be discovered and that, if discovered, it may not be economically viable or technically feasible to produce any of the resources.]
The Report on the hydrocarbon resource potential of the Beetaloo Basin describes a possible distribution of the unrisked prospective (recoverable) portion of unrisked “Undiscovered in-place Resources,” as defined by the Canadian Oil and Gas Evaluation Handbook (COGEH) and does not represent an estimate of reserves or contingent resources. The Report has been prepared in accordance with the Canadian standards set out in the COGEH and is compliant with National Instrument 51-101 “Standards of Disclosure for Oil and Gas Activities.”
Ryder Scott evaluates oil and gas properties and independently certifies petroleum reserve and resource quantities in the U.S., Canada and internationally. Founded in 1937, Ryder Scott is one of the largest, oldest and most respected reservoir-evaluation consulting firms in the industry.
Source: CNW Group
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