Eureka advised that its share of the 2P reserves at its Sugarloaf oil and gas project in Texas have increased by 40 percent to 6.7 million barrels of oil equivalent (MMboe).
The upgraded 2P estimate is equivalent to a net present value of US $118.9 million, or US 0.50 a share. Eureka shares closed on the ASX at A$0.185 a share on October 17, 2011.
The revised figure provides more strong evidence of the extremely robust reserves at Sugarloaf and further increases the partners' confidence in the field's ability to host a substantial increase in the number of producing wells.
Two further wells drilled in 2011 after the effective date of the reserves report are expected to further increase Eureka's 1P and 2P reserves position and add additional value to the Sugarloaf asset by the end of this calendar year.
The revised reserve estimate was conducted by independent consultants Netherland Sewell & Associates, Inc. (NSAI).
Eureka Managing Director and CEO Peter Mills said the latest reserve upgrade confirms the current and future strength of Sugarloaf.
"Sugarloaf is already an outstanding asset for Eureka and we expect its contribution to the Company to grow even further when new operator Marathon takes over in November," Mr. Mills said. "This is expected to see additional rigs assigned to the area, resulting in further increases in reserves and production."
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