The technical data utilized in the McDaniel & Associates' review includes the Group's extensive 2D seismic data shot across Block E during 2006. The updated report estimates the risked mean prospective resources from Block E at 157.9 million barrels of oil equivalent ("boe"), calculated in accordance with the standards of the Society of Petroleum Engineers. The Group owns an 80% equity interest in the Blocks A&E license area in the Republic of Kazakhstan.
Given the full extent of the Group's acreage position in Blocks A&E, the McDaniel update reflects only a limited review of Block E, including a total of two out of 11 deep leads and prospects, seven out of 48 shallow leads and prospects and one out of 28 intermediate leads and prospects identified to date on Blocks A&E. The Group's data from its 380 km2 3D seismic shoot in Block E was not processed and available in time to be included in the McDaniel evaluation. The Group is currently analysing the 3D data, which is generating additional leads and prospects in Block E.
The key highlights from the report prepared by McDaniel are as follows:
The Group's prospective resources exclude its recently released estimate of 10 million boe of proved plus probable reserves in its shallow Zhana Makat discovery in Block E. The Group's acreage on Block A is also not included in McDaniel's evaluation. Additionally, McDaniel is still working on an update of the Group's Astrakhanskiy block, which was originally considered to be highly prospective even without the benefit of the high quality 2D seismic shot over a portion of that acreage in the fourth quarter of 2006.
Jim Jeffs, Executive Chairman, commented:
"The results of the McDaniel update, based on a limited number of identified leads and prospects on E Block, simply corroborate the fact that Max Petroleum has a very prospective asset base with multiple and varied avenues to dramatically enhance shareholder value. We have a gross acreage position of 13,800 km2 in one of the most prolific hydrocarbon bearing basins in the world, which we have only just begun to explore. The biggest challenge we face is to properly rank and prioritize our various targets, while at the same time, remaining focused on the shorter term development of our discoveries to enhance production and cash flow."
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