NOVUS ENERGY INC. ANNOUNCES RESULTS OF CONTINGENT RESOURCE ASSESSMENT FOR ITS VIKING LIGHT OIL ASSET IN THE DODSLAND AREA OF SAS
December 06 2010 - 8:00AM
PR Newswire (Canada)
CALGARY, Dec. 6 /CNW/ -- /NOT FOR DISTRIBUTION TO U.S. NEWS WIRE
SERVICES OR DISSEMINATION IN THE U.S./ CALGARY, Dec. 6 /CNW/ -
Novus Energy Inc. ("Novus" or the "Company") (TSXV: NVS) is pleased
to announce that Sproule Associates Limited ("Sproule"), an
independent engineering and geological consulting firm and a
qualified reserves evaluator, has provided Novus with an
independent Contingent Resource Assessment (the "Report") for the
Company's Dodsland Saskatchewan area Viking light oil assets. The
intent of the Report was to independently assess the contingent
resource potential of the Company's Dodsland Viking oil assets. The
Report, effective as at November 30, 2010, is in accordance with
section 5.9 of National Instrument 51-101 ("NI 51-101") -
"Standards of Disclosure for Oil and Gas Activities" and reports a
"best estimate" of Discovered Petroleum Initially-In-Place
("DPIIP"), both as defined in the Canadian Oil and Gas Evaluation
Handbook (the "COGE Handbook"). The DPIIP on Novus working interest
and option lands totals 559.5 Million Barrels ("MMSTB") of light
Viking oil, consisting of 383.2 MMSTB gross working interest DPIIP
and an additional 176.3 MMSTB on currently unearned lands under
option to Novus. The DPIIP is based on geological well control,
existing vertical and horizontal well production, and drilling
results to date. In the Report, approximately 50% of the net
acreage controlled by Novus (40.53 net sections owned and 13.53 net
sections under option) was recognized by Sproule as containing
discovered resources. No attempt was made to estimate contingent
natural gas or natural gas by-product resources on the Company
lands. A Summary of the report is included in the table below:
CONTINGENT RESOURCES DPIIP Low Best High Estimate Estimate Estimate
(P90) (P50) (P10) (mmstb) (mmstb) (mmstb) (mmstb) Novus Working
Interest Lands 7.2 14.7 28.6 383.2 Novus Option Lands 3.8 7.7 15.0
176.3 Total Resources 11.0 22.4 43.6 559.5 Average Recovery Factor
2.1% 4.3% 8.4% n/a Note: DPIIP volume includes lands that had
previously been assigned reserves, as of Dec. 31, 2009. Hugh Ross,
President and CEO of Novus commenting on the Report, indicated
that, "We are very pleased to provide our shareholders with an
independent assessment of the potential of our core Dodsland area
property. This resource estimate of 559.5 Million Barrels ("MMSTB")
establishes a significant opportunity for the Company to add future
production and reserves in the area using current horizontal well
technology. Novus also believes that the development of the Viking
resource is in its early stages and that there is further upside to
the recovery factors by applying secondary recovery methods that
have not yet been implemented. Novus shall continue its efforts to
actively drill on its existing land base in the Dodsland area, and
shall remain focused on expanding its presence within this large
oil resource play. Future drilling operations on these lands and
other remaining lands not included in the Report are expected to
increase the DPIIP estimates in the future. This resource
assessment demonstrates the significant success we have achieved to
date and demonstrates a compelling opportunity for the Company to
add significant reserves through improvements in recovery factors.
Given the large oil resource the Company possesses, the magnitude
of even minor improvements in recovery factors to the Company is
great. Novus has successfully transitioned itself into a Company
with a large oil resource asset base, and has the opportunity base
to provide it with years of lower risk oil drilling opportunities."
It should be noted that given the early stages of development, the
best estimate of DPIIP may change in the future with further
exploration and development activity. Additional drilling, testing
and development are required to confirm economic development and
ultimate recovery factors in the play. The resource estimates
provided herein are estimates only and the actual resources may be
greater or less than the estimates provided herein. Novus Energy
Inc. is a well positioned, junior oil and gas company with a proven
management team committed to aggressive, cost-effective growth of
high netback light oil reserves and production. Novus intends to
continue its strategy of growth through a targeted acquisition and
consolidation strategy coupled with development and exploration
drilling. Novus' current financial position and unused lines of
credit will allow for the exploitation of its drilling inventory
and expansion of the Company's opportunity suite through internally
generated prospects and strategic light oil acquisitions. Novus
Shares trade on the TSX Venture Exchange under the symbol NVS.
Novus currently has 166.4 million common shares outstanding.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. This news release will not constitute an
offer to sell or the solicitation of an offer to buy the securities
in any jurisdiction. Such securities have not been registered under
the United States Securities Act of 1933 and may not be offered or
sold in the United States, or to a U.S. person, absent
registration, or an applicable exemption therefrom. ADVISORY
REGARDING FORWARD LOOKING STATEMENTS Certain disclosures set forth
in this press release constitute forward-looking statements. Any
statements contained herein that are not statements of historical
facts may be deemed to be forward-looking statements.
Forward-looking statements are often, but not always, identified by
the use of words such as "anticipate", "believes", "budget",
"continue", "could", "estimate", "forecast", "intends", "may",
"plan", "predicts", "projects", "should", "will" and other similar
expressions. All estimates and statements that describe the
Company's future, goals, or objectives, including Management's
assessment of future plans and operations, may constitute
forward-looking information under securities laws. Forward-looking
statements involve known and unknown risks and uncertainties which
include, but are not limited to: exploration, development and
production risks; assessments of acquisitions; reserve
measurements; availability of drilling equipment; access
restrictions; permits and licenses; aboriginal claims; title
defects; commodity prices; commodity markets; transportation and
marketing of crude oil, liquids and natural gas; reliance on
operators and key personnel; competition; corporate matters;
availability of attractive acquisition opportunities to generate
growth, funding requirements; access to credit and capital markets;
market volatility; cost inflation; foreign exchanges rates; general
economic and industry conditions; environmental risks; impact of
the Kyoto protocol; and government regulation and taxation.
Forward-looking statements relate to future events and/or
performance and although considered reasonable by Novus at the time
of preparation, they are not a guarantee of future results and may
prove to be incorrect and actual results may differ materially from
those anticipated in the statements made. Novus does not undertake
any obligation to publicly update forward-looking information
except as required by applicable securities law. Readers are
cautioned that the assumptions and factors discussed in this press
release are not exhaustive and that the assumptions used in the
preparation of such information, although considered reasonable at
the time of preparation, may prove to be imprecise, and as such,
undue reliance should not be placed on forward-looking statements.
Original oil-in-place and discovered resource in place figures
included in this press release are independent third party
estimates, actual figures and recovery factors may be materially
less. Given the risk of costs of development and fluctuating
commodity prices, there is no certainty that it will be
commercially viable to produce the resources mentioned. Novus'
actual results, performance or achievement could differ materially
from those expressed in, or implied by, these forward- looking
statements, and accordingly, no assurance can be given that any of
the events anticipated by the forward-looking statements will
transpire or occur, or if any of them do, what benefits that Novus
will derive there from. The forward looking statements are
expressly qualified by these cautionary statements. Special Note
Regarding Disclosure of Reserves or Resources "Discovered Petroleum
Initially-In-Place" (equivalent to discovered resources) is defined
in the Canadian Oil and Gas Evaluation Handbook as that quantity of
petroleum that is estimated, as of a given date, to be contained in
known accumulations prior to production. The recoverable portion of
discovered petroleum initially-in-place includes production,
reserves, and contingent resources; the remainder is unrecoverable.
"Contingent resources" are defined in the COGE Handbook as those
quantities of petroleum estimated to be potentially recoverable
from known accumulations using established technology or technology
under development, but which are not currently considered to be
commercially recoverable due to one or more contingencies.
Contingencies may include factors such as economic, legal,
environmental, political, and regulatory matters, or a lack of
markets. It is also appropriate to classify as contingent resources
the estimated discovered recoverable quantities associated with a
project in the early evaluation stage. The Contingent Resources
estimates and the DPIIP estimates are estimates only and the actual
results may be greater than or less than the estimates provided
herein. There is no certainty that it will be commercially viable
to produce any portion of the resources except to the extent
identified as proved or probable reserves. "Best estimate" is
defined in the COGE Handbook with respect to entity-level
estimates, as the value derived by an evaluator using deterministic
methods that best represent the expected outcome with no optimism
or conservatism. If probabilistic methods are used, there should be
at least a 50 percent probability (P50) that the quantities
actually recovered will equal or exceed the best estimate. NOVUS
ENERGY INC., Hugh G. Ross, President and CEO, (403) 218-8895; Ketan
Panchmatia, Chief Financial Officer, (403) 218-8876; Julian Din, VP
Business Development, (403) 218-8896
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