ShaMaran Updates on Reserves, Resources Estimates for Iraq's Atrush Block

ShaMaran Petroleum Corp. (ShaMaran or the Company) reported Thursday updates to estimated reserves and contingent resources for the Atrush block in the Kurdistan Region of Iraq as of Dec. 31, 2014. The reserves and contingent resources estimates were provided by McDaniel & Associates Consultants Ltd. (McDaniel), the Company’s independent qualified resources evaluator, and were prepared in accordance with standards set out in the Canadian National Instrument NI 51-101 and Canadian Oil and Gas Evaluation Handbook (COGEH).

McDaniel estimates for reserves and contingent resources have taken into account the results of all available drilling, well testing results and other information acquired since Dec. 31, 2013, i.e. Atrush-4, Chiya Khere-5 (CK-5), CK-8 and CK-6, the latest remapping based on the final 3D seismic processing and the ongoing commitment to and work program in support of the first phase of Atrush development as defined by the KRG approved Field Development Plan.

Reserves Summary – Atrush Phase 1 Development (as of Dec. 31, 2014)

Light/Medium Oil (in million barrels)

  • Total Proven Reserves (1P): Property Gross - 31,216; Company Gross - 6,274; Company Net - 4,500
  • Probable Reserves: Property Gross - 30,235; Company Gross - 6,077; Company Net - 3,361
  • Proved and Probable Reserves (2P): Property Gross - 61,451; Company Gross - 12,352; Company Net - 7,861
  • Possible Reserves: Property Gross - 59,520; Company Gross - 11,964; Company Net - 4,479
  • Proved + Probable and Possible Reserves (3P): Property Gross - 120,972; Company Gross - 24,315; Company Net - 12,340

Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10 percent probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible reserves. The reserves were estimated using forecast prices and costs. The sales oil price was based on the McDaniel Jan. 1 price forecast. The estimated discount to Brent is made up of a unit cost element and a percentage element and accounts for the quality differential, transportation tariffs and marketing fees. All of the Atrush oil production is to be exported via the Khurmala-Fishkabur pipeline to Turkey. A 23 mile (37 kilometer) pipeline is being built from the Atrush Field to a tie-in point on this export line and will be operated by KRG. At this stage the oil price differential is uncertain and any additional announcements of sales and pricing of exported Kurdish crude during 2015 may impact on future price scenarios.

The updated estimates of contingent resources for the Atrush block are as follows:

Contingent Resources Summary – Atrush Jurassic Oil Discovery (as of Dec. 31, 2014)

Property Gross

  • Light/Medium Oil (in million barrels): Low Estimate - 179,891; Best Estimate - 298,760; High Estimate - 434,948
  • Natural Gas (in million cubic feet): Low Estimate - 38,930; Best Estimate - 66,368; High Estimate - 101,590
  • Total (in million barrels of oil equivalent): Low Estimate - 186,379; Best Estimate - 309,821; High Estimate - 451,880

Company Gross

  • Light/Medium Oil (in million barrels): Low Estimate - 36,158; Best Estimate - 60,051; High Estimate - 87,425
  • Natural Gas (in million cubic feet): Low Estimate - 7,825; Best Estimate - 13,340; High Estimate - 20,420
  • Total (in million barrels of oil equivalent): Low Estimate - 37,462; Best Estimate - 62,274; High Estimate - 90,828

The resources included in the table above are classified as contingent as the associated project(s) are dependent upon the results of the Atrush Phase 1 development and ongoing appraisal work; this first phase of development should, together with further appraisal drilling, narrow the uncertainty in the contingent resources estimates and help determine if their development is economic.

There were no material changes to the range of reserves reported at Dec. 31, 2013, and it therefore remains the view of the Company that the reserve base continues to support the 30,000 barrels per day (bpd) Atrush Phase 1 development program scheduled for startup in the fourth quarter of 2015. A reduction in contingent resources from the quantities reported as of Dec. 31, 2013 reflects a more complex geological structure (interpreted from the 3D seismic data processed in 2014 and year to date well results) and a reduced estimate of recovery factor from the rock matrix. The recoverable estimates are related to a water drive mechanism as per the current field development plan and therefore exclude any upside associated with any future improved oil recovery efforts.

As there was no new information that impacted prospective resources the Dec. 31, 2013 report was not updated for prospective resources.

Additional information related to above noted reserve and resource estimates, including net present value estimates, is included in Form 51-101F1, which may be viewed under the Company’s profile on SEDAR at

The Atrush Block is operated by the Abu Dhabi National Energy Company PJSC (TAQA) and is held 39.9 percent by TAQA, ShaMaran Petroleum Corp., through its wholly owned subsidiary General Exploration Partners, Inc. (GEP) 20.1 percent, 15 percent Marathon Oil KDV B.V., (a wholly owned subsidiary of Marathon Oil Corporation), and 25 percent by the KRG. Atrush reserves and resource estimates presented represent solely the view of ShaMaran and its experts.


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