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Press release from CNW Group


Tuesday, July 05, 2011

STERLING RESOURCES ANNOUNCES INCREASED RESERVES FOR BREAGH AND INTENTIONS FOR SECOND PLATFORM07:00 EDT Tuesday, July 05, 2011CALGARY, July 5, 2011 /CNW/ - Sterling Resources Ltd. (TSX-V:SLG)("Sterling" or the "Company") is pleased to announce increased Company interest reserves numbers for the Breagh field located in the UK Southern North Sea as a result of the successful drilling of appraisal well 42/13a-6 earlier this year. These Company interest reserves have been independently preparedin accordance with the standards contained in the COGE Handbook by RPS Energy, Sterling's reserves evaluator, as of May 31st, 2011 in a report dated June 12th, 2011. This report pertains only to the Breagh field.Proved (1P) Reserves have risen from 23.6 million barrels of oil equivalent (MMboe) at year end 2010 to 28.2 MMboe, an increase of approximately 19 percent. Similarly, an increase in the Proved plus Probable (2P) Reserves has been realized rising from 31.6 MMboe to 35.3 MMboe, an increase of 12 percent. Proved plus Probable plus Possible (3P) Reserves have risen from 39.0 MMboe to 44.1 MMboe, an increase of 13 percent. Proved (1P) ReservesProved plus Probable (2P) ReservesProved plus Probable plus Possible (3P) ReservesBreagh Reserves2,32010 Year End    Sales Gas, Billions of Cubic Feet (Bcf)138185229NGLs, Millions of Barrels0.60.80.9TOTAL - Millions of Barrels of Oil Equivalent (MMboe)123.631.639.0    June 2011 Update   Sales Gas, Billions of Cubic Feet (Bcf)165207258NGLs, Millions of Barrels0.70.81.1TOTAL - Millions of Barrels of Oil Equivalent (MMboe)128.235.344.1    Other UK Properties2,32010 Year End (MMboe)1   Kirkleatham (UK onshore) (UK offshore)5-1.11.5Revised Company TOTALJune, 2011 (MMboe)128.336.646.1Notes:Boe numbers may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Bcf:1 MMboe is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.The estimates of reserves and future net revenue for individual properties may not reflect the same confidence level as estimates of reserves and future net revenue for all properties, due to the effects of aggregation.All volumes are attributable to the Company's interest in each of the respective locations.Gas converted to boe at 6 Mcf = 1 boe.Oil."These updated reserves numbers clearly indicate the impact of our drilling success at East Breagh earlier this year. The 42/13a-6 well was drilled approximately six kilometers from the 42/13-3 and 42/13-5Z wells both of which are located on the western side of the field which will be developed utilizing the Breagh Alpha platform," stated John Rapach, Sterling's Chief Operating Officer. "The success of the 42/13a-6 well is great news for the Breagh development story and the partnership has now commenced conceptual and environmental studies for a second phase of development, most likely involving a second platform on the eastern side of the field. These studies will form the basis of an addendum to the current Field Development Program (FDP) for the Breagh Field submitted to the Department of Energy and Climate Control. The second phase addendum is planned to be submitted during the fourth quarter of 2011. First gas from the intended Breagh Bravo platform would be expected during 2013," added Mr. Rapach.The full field project remains on schedule and budget. Fabrication of the jacket and topsides for the Breagh Alpha platform are progressing towards tow-out and installation is scheduled for mid-August. Pipelay operations have progressed well during May and June with all but three kilometers of the 20 inch production pipeline and the majority of the three inch methanol lines constructed and laid on the seabed by the Allseas pipelay vessel Lorelay. The beach crossing has been completed with a Horizontal Directional Drilling (HDD) installation of the various pipelines and services under the Coatham sand dunes and beach to a point one kilometer offshore. "It's a fantastic time for the development and satisfying to see this project now taking shape after Sterling Resources' start to the Breagh story with the drilling of the 42/13-3 well in 2007," added Mr. Rapach.Sterling holds a 30 percent interest in Breagh with operator RWE Dea holding 70 percent.Sterling Resources Ltd. is a Canadian-listed international oil and gas company headquartered in Calgary, Alberta with assets in the United Kingdom, Romania, France and the Netherlands. The shares are listed and posted for trading on the TSX Venture Exchange under the symbol "SLG".Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.Filer Profile No. 00002072Forward-Looking StatementsAll statements included in this press release that address activities, events or developments that Sterling expects, believes or anticipates will or may occur in the future are forward-looking statements. In addition, statements relating to reserves or resources are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves and resources described can be profitably produced in the future.These forward-looking statements involve numerous assumptions made by Sterling based on its experience, perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. In addition, these statements involve substantial known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other-forward looking statements will prove inaccurate, certain of which are beyond Sterling's control, including: the impact of general economic conditions in the areas in which Sterling operates, civil unrest, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. In addition there are risks and uncertainties associated with oil and gas operations. Readers should also carefully consider the matters discussed under the heading "Risk Factors" in the Company's Annual Information Form.Undue reliance should not be placed on these forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. Sterling's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements. These statements speak only as of the date of the press release. Sterling does not intend and does not assume any obligation to update these forward-looking statements except as required by law.Financial outlook information contained in this press release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management's assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this press release should not be used for purpose other than for which it is disclosed herein.  For further information: visit or contact: Mike Azancot, President and Chief Executive Officer, Phone 44-7740-432883, David Blewden, Chief Financial Officer, Phone: 44-1330-826766, Mobile: 44-7771-740804, George Kesteven, Manager, Corporate and Investor Relations, Phone: (403) 215-9265, Fax: (403) 215-9279,