Petrolympic Ltd: Independent Report by "Sproule Associates Limited" Confirms the Presence of Conventional Natural Gas in the ...
April 11 2014 - 3:48PM
Marketwired Canada
Petrolympic Ltd. ("Petrolympic" or the "Company") (TSX VENTURE:PCQ) is pleased
to announce the results of an independent resource evaluation carried out by
Sproule Associates Limited ("Sproule") on a structure drilled on its joint
venture property in the Lower St. Lawrence area (the "Property") located in the
Appalachian Basin of Quebec. Sproule conducted its evaluation according to the
Canadian Oil and Gas Evaluation Handbook reserve and resource definitions. The
Company holds an interest in 431,339 hectares (1,065,839 acres) of the Property
through a joint-venture with Squatex Energy and Resources Inc. ("Squatex"), the
operator on the Property.
The results of this independent evaluation (as shown in Table 1 below) are based
on the data gathered when drilling the Masse No.1 core hole. The results of the
evaluation builds on the data released by Petrolympic in it's press release
dated November 15, 2013 (filed on www.sedar.com). Paul Laroche, a geologist with
Petrolympic provides the following comments: "The well revealed a reservoir
hosted in the Silurian Sayabec Formation and consisting of a 10 meter-thick
interval of hydrothermally dolomitized limestone with high porosity and
permeability values up to 20.8% and 1624 mD, respectively (as shown in Table 2
below). Contrary to shale gas, these types of reservoirs do not require
hydraulic fracturation. The analysis of the gas charge of the reservoir
indicated it is composed of 89% methane and devoid from hydrogen sulfide."
Jean-Claude Caron, President of Squatex draws a comparison between the Property
and St. Flavien reservoir in the St. Lawrence Lowlands - one of the only two
reservoirs that have produced natural gas in economic quantities in Quebec: "The
parameters reported from Masse No.1 core hole are similar to St. Flavien
reservoir, which is also hosted in hydrothermally dolomitized limestone with
thickness varying between 1 and 8 meters, porosity values ranging from 2.5-10%
(average between 3-5%). St. Flavien reservoir has produced 5.7BCFG prior to
being converted into an underground gas storage facility that is still in
operation since 1998."
The results obtained by Petrolympic and Squatex in the Lower St. Lawrence are
encouraging and present additional opportunities since the evaluation is focused
on only one of the three hydrocarbon-bearing zones identified in the well.
Furthermore, several seismic anomalies with characteristics similar to Masse
No.1 core hole have also been highlighted by the proprietary seismic data within
the limits of the Property. This is not included in the Sproule resource
evaluation and presents significant upside to the potential of the Property,
further validating the pioneering efforts of Petrolympic and Squatex in
exploring the potential of the area.
Petrolympic and their partner Squatex are now designing a drilling program to
validate the potential of the Masse Structure, and are preparing an exploration
program to further document and test other prospective structures identified
within the Property."The timing is right for demonstrating the producibility of
a natural gas conventional reservoir in the Lower St. Lawrence, since economic
growth in the area will be likely stimulated by the recent election of a
majority government in the province, and clean energy sources will be in high
demand on close local markets", says Mendel Ekstein, President and CEO of
Petrolympic.
Petrolympic also owns a 100% interest in two exploration permits in the same
area, referred to as the Matapedia and the Mitis properties. Several
conventional plays and exploration leads have been identified in these permits
where oil and gas have been encountered in mining wells in the 90's. Based on
proprietary seismic data, the prospective Sayabec Formation is also believed to
be present at depth in these two permits.
Table 1: Results of the resource evaluation as presented in Sproule's report.
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Table S-2
Summary of Project Gross Unrisked Undiscovered Unrecoverable Gas Initially-
in-Place (GIIP)
Sayabec Formation of the Masse Structure, Lower St. Lawrence Area, Quebec,
Canada(1,2) Estimated by Sproule Associates Limited, As of February 28,
2014
----------------------------------------------------------------------------
Structure Formation Gas (BCF)(2,3)
-----------------------------------------------
Low(4) Best(5) High(6) Mean(7)
---------------------------
(P90) (P50) (P10)
----------------------------------------------------------------------------
Masse Sayabec 3 8 26 12
----------------------------------------------------------------------------
1. Undiscovered Petroleum Initially-in-place (equivalent to undiscovered
resources) is the quantity of petroleum that is estimated, on a given
date, to be contained in accumulations yet to be discovered. The
recoverable portion of undiscovered petroleum initially in place is
referred to as "prospective resources", the remainder as
"unrecoverable". Only the in-place volumes are presented here as a
development project to recover any hydrocarbons discovered has not been
defined. There is no certainty that any portion of these unrisked
undiscovered GIIP will be discovered and, if discovered, there is no
certainty that it will be developed or, if it is developed, there is no
certainty as to either the timing of such development or whether it
will be commercially viable to produce any portion of these resources.
2. These are the project gross unrisked undiscovered petroleum initially
in place volumes (i.e. 100% project gross) estimated for the Sayabec
Formation of the Masse Structure without any adjustments for working
interest and before deduction of any royalties.
3. "BCF" is billions of cubic feet, "MMboe" is millions of barrels of oil
equivalent.
4. Low Estimate is considered to be a conservative estimate of the
quantity that will actually be in-place. It is likely that the actual
remaining quantities in-place will exceed the low estimate. If
probabilistic methods are used, there should be at least a 90 percent
probability (P90) that the quantities actually in-place will equal or
exceed the low estimate.
5. Best Estimate is considered to be the best estimate of the quantity
that will actually be in-place. It is equally likely that the actual
remaining quantities in-place will be greater or less than the best
estimate. If probabilistic methods are used, there should be at least a
50 percent probability (P50) that the quantities actually in-place will
equal or exceed the best estimate.
6. High Estimate is considered to be an optimistic estimate of the
quantity that will actually be in-place. It is unlikely that the actual
remaining quantities in-place will exceed the high estimate. If
probabilistic methods are used, there should be at least a 10 percent
probability (P10) that the quantities actually in-place will equal or
exceed the high estimate.
7. Statistical aggregation is the process of probabilistically aggregating
distributions that represent estimates of resource quantities at the
reservoir, prospect, or portfolio level. Arithmetic summation and
statistical aggregation of the means yield similar results. Arithmetic
summation of the Low Estimate, Best Estimate and High Estimate are not
statistically appropriate. Both the statistical and arithmetic
summation of the unrisked prospects may be misleading because it
assumes success for each of the prospect entities. The chance of this
occurring is extremely unlikely. Actual recovery is likely to be less
and may be zero.
Table 2: Core laboratory analyses from the Masse No.1 core hole, as reviewed by
Sproule and used as input parameters in the resource evaluation.
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SQUATEX RESSOURCE ET ENERGIE SQUATEX MASSE #1
Field : Formation :
Province : QUEBEC Coring equip :
Coring fluid :
License : WATER BASE MUD
CORE ANALYSIS RESULTS
----------------------------------------------------------------------------
PERMEABILITY PERMEABILITY
(MAXIMUM) (90 DEG)
DEPTH SAMPLE LENGTH Kair Kair
SAMPLE NUMBER m m mD mD
----------------------------------------------------------------------------
FD 1 1845.20 0.11 0.02 0.01
FD 2 1847.10 0.07 1624 1584
FD 3 1848.00 0.09 0.01 0.01
FD 4 1856.00 0.05 0.06 0.02
less than
FD 5 1873.50 0.04 0.01 less than 0.01
Results of five core sample analyses for the Masse # 1 well. The Company
determined an average porosity estimate of 4,1% for the dolomitized zone of
interest using results from Samples FD-1 (1,845.2 m; 3,7%), FD-2 (1,847.1
m; 20,8%), and FD-3 (1,848.0 m;1,3%). A porosity of 4,1% over a net pay
thickness of 5 m (4,7m = approx. 3%; 0,3 m = 20,8%) is a mathematical
average that assumes the Masse # 1 well is representative of the average
petrophysical characteristics for the entire Masse Structure - which in
reality is likely not the case (Estimation du Gaz en Place - Structure
Masse, September 2013).
----------------------------------------------------------------------------
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SQUATEX RESSOURCE ET ENERGIE
SQUATEX MASSE #1 File No. : 52131-13-0145
Field : Formation : Date : 2013-07-26
Province :
QUEBEC Coring equip : Analysts : DJB
Coring fluid : WATER
License : BASE MUD Core Dia : 48 mm
CORE ANALYSIS RESULTS
----------------------------------------------------------------------------
PERMEABILITY
(VERTICAL) POROSITY BULK GRAIN
Kair (HELIUM) DENSITY DENSITY
SAMPLE NUMBER mD fraction (kg/m3) (kg/m3) DESCRIPTION
----------------------------------------------------------------------------
less than
FD 1 0.01 0.037 2710 2810 dol i ppv sv mv
less than
FD 2 0.01 0.208 2220 2800 dol i ppv sv
less than
FD 3 0.01 0.013 2780 2810 dol i sv
FD 4 0.02 0.007 2640 2660 ss vf f vfrac
less than
FD 5 0.01 0.002 2640 2640 ss vf f
Results of five core sample analyses for the Masse # 1 well. The Company
determined an average porosity estimate of 4,1% for the dolomitized zone of
interest using results from Samples FD-1 (1,845.2 m; 3,7%), FD-2 (1,847.1
m; 20,8%), and FD-3 (1,848.0 m;1,3%). A porosity of 4,1% over a net pay
thickness of 5 m (4,7m = approx. 3%; 0,3 m = 20,8%) is a mathematical
average that assumes the Masse # 1 well is representative of the average
petrophysical characteristics for the entire Masse Structure - which in
reality is likely not the case (Estimation du Gaz en Place - Structure
Masse, September 2013).
----------------------------------------------------------------------------
About Petrolympic Ltd.
Petrolympic Ltd. is a Canadian junior oil and gas company actively exploring for
premium light crude oil and natural gas in North America. The Company is
presently focused on its near-term oil production asset in the prolific Maverick
Basin of Texas, USA. The Company also holds an interest in a total of 754,216
hectares (1,863,668 acres) of oil and gas exploration permits in the Appalachian
Basin of Quebec that include holdings in the St. Lawrence Lowlands and Gaspe
Peninsula. The Company's holdings in the St. Lawrence Lowlands consist of a 30%
interest in 217,370 hectares (536,941 acres) through a joint venture with
Squatex Energy and Resources Inc. ("Squatex"), a 12% interest in 8,000 hectares
(19,768 acres) through the Farmout Agreement with Canbriam Energy Inc., and a
100% interest in 56,622 hectares (139,913 acres) located over the Lowlands
shallow carbonates platform on the south shore of the St. Lawrence River, less
than 30 kilometers southwest of Montreal. These properties represent a major
position in the Utica Lorraine and Trenton-Black River Plays. Petrolympic also
maintains holdings in the Gaspe and Lower St. Lawrence regions, including a 30%
interest in 431,339 hectares (1,065,839 acres) through a joint venture with
Squatex and a 100% interest in a block of exploration permits totalling 40,885
hectares (101,029 acres) located between Rimouski and Matane prospective for
hydrothermal dolomite hosted light oil.
About Squatex Energy and Resources Inc.
Squatex Energy and Resources Inc. ("Squatex") is an oil and gas exploration
company created in on April 12, 2002 under the Canada Business Corporation Act
having its main office located at 7055, Boul. Taschereau, suite 500, Brossard
(Quebec) J4Z 1A7. Squatex is a reporting issuer only in the province of Quebec.
Its shares are not traded in any formally organized stock exchange market. The
main objective of Squatex is, as the operator, to carry out exploration work in
order to evaluate the oil and gas potential of a territory under leases covering
656,093 hectares. Squatex owns in the St. Lawrence Lowlands a 70% interest over
217,370 hectares under a joint venture agreement with Petrolympic Ltd. (TSX
VENTURE:PCQ) and a 28% interest over 8,000 hectares that were farmed out to
Canbriam Energy Inc. Squatex also owns a 70% interest over 431,339 hectares in
the Lower St. Lawrence under its joint operation agreement with Petrolympic Ltd.
Forward-Looking Statements
This press release includes certain "forward-looking information" within the
meaning of the Securities Act (Ontario), including, but not limited to,
statements as to timing and extent of exploration programs and the availability
of exploration results. As such, forward-looking information addresses future
events and conditions and so involves inherent risks and uncertainties, as
disclosed under the heading "Risk Factors" and elsewhere in Petrolympic
documents filed from time to time with the Ontario Securities Commission and
other regulatory authorities. Actual results could differ significantly from
those currently projected as a result of, among those factors, adverse weather,
regulatory changes, delays in receiving permits, accidents and delays in
completing exploration activities not all of which are in the control of
Petrolympic. The forward-looking information contained herein is Petrolympic's
reasonable estimate today of future events and conditions, but no assurance can
be given that such events or conditions will occur. The reader is cautioned not
to rely on these forward-looking statements. Petrolympic disclaims any
obligation to update these forward-looking statements.
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.
FOR FURTHER INFORMATION PLEASE CONTACT:
Petrolympic Ltd.
Mendel Ekstein
President and CEO
(845) 656-0184
exis@petrolympic.com
Squatex Energy and Resources Inc.
Jean-Claude Caron
President and CEO
(819) 929-3758
jeanclaudec@globetrotter.net
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