In a news release, Pan Orient Energy Corp. (POE:TSX.V) announced the results of an independent reserves evaluation for Concession L53/48 in onshore Thailand. The company has a 50.01% stake in the joint venture entity Pan Orient Energy (Siam) Ltd. that owns the concession.
"This year-end 2020 reserves report is an excellent result," Pan Orient Energy Corp. CEO Jeff Chisholm said in the release.
Alberta, Canada-based Sproule International Ltd. carried out the reserves evaluation and NI 51-101 compliant report. It indicated that total proved (1P) oil reserves at the L53 Concession as of Dec. 31, 2020, were 2,836,000 barrels (2.836 MMbbl). This reflects a 130% increase over the Dec. 31, 2019, amount of 1.235 MMbbl.
Proved and probable (2P) reserves rose 30% during 2020 to 4.753 MMbbl from 3.668 MMbbl. The company noted that the increase in 2020 reflects a 15% increase in oil sales, discovery of the L53AA field, as well as overall positive technical revisions and infill drilling.
As for the L53 Concession crude oil reserves net to Pan Orient Energy Corp.'s 50.1% equity interest in the joint venture entity, they totaled 2.377 MMbbl at Dec. 31, 2020. These equate to an after-tax net present value (NPV) of about CA$38.9 million, or CA$0.75 per Pan Orient share, using forecast prices and a 10% annual cost discount. Pan Orient noted that it "does not have any direct interest in, or control over, the crude oil reserves or operations of on-shore Concession L53/48."
"While the oil volumes are strong, the 2P NPV after tax (discounted at 10%) was down 11% year on year as a result of the substantially lower (-17%) average oil price forecast at year-end 2020 versus year-end 2019, a reflection of the current uncertainty in the global oil markets," Chisholm explained.
Regarding 2P plus possible crude oil reserves, the total net to Pan Orient's interest was 3.423 MMbbl, having an after-tax NPV of CA$51.7 million, or CA$1 per Pan Orient share.
As for what's ahead, Chisolm said that "despite the uncertainty with regard to oil markets in 2021, we look forward to a strong year of oil production performance from the L53 Concession."
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