Harold Hemmerich, President and Chief Executive Officer of Transeuro, commented, "We are pleased to entering this phase of our operations with the Nahanni well. We look forward to the completion of drilling operations later this year and the testing in early 2008." The Nahanni is a highly productive formation at the Field and in the surrounding area. The original A-2 and A-5 wells are approximately 0.8 km away from the A-8 well. The A-2 well has cumulative production of 39 Bcf with a peak rate of 54.5 mmcf/d and the A-5 well has cumulative production of 50.1 Bcf with a peak rate of 57.7 mmcf/d.
Questerre's independent reservoir engineers have attributed gross possible reserves of 120 Bcf to the Nahanni and a remaining contingent resource of 540 Bcf. Recovery would be contingent upon proving the theory of compartmentalization and achieving a 50% recovery of the discovered resource.
Contingent resources are defined in the COGE Handbook, “Contingent resources are those quantities of oil and gas estimated on a given date to be potentially recoverable from known accumulations but are not currently economic.”
The Company has at 50% gross and net interest in the A-8 well. The cost of the well is estimated to be $15.4 million. Transeuro has advanced funds for its interest.
Clarification of August 21, 2007 news release:
The Company reported the Beaver River Field contained significant gas in place estimated at 495 Bcf – 750 Bcf per section with a 1,000m net reservoir thickness. This should have been reported as a discovered resource. This resource is not classified as reserves, contingent resources or unrecoverable resources at this time until determination of the appropriate completion and stimulation techniques and the determining of areas of maximum natural fracturing to maximize recovery of this discovered resource. There is no certainty that it will be economically viable or technically feasible to produce any portion of the reported discovered resource.
Discovered resources are defined in the COGE Handbook, “Discovered resources are those quantities of oil and gas estimated on a given date to be remaining in, plus those quantities already produced from, known accumulations. Discovered resources are divided into economic and uneconomic categories, with the estimated future recoverable portion classified as reserves and contingent resources, respectively."
The Company reported gross estimated recoverable reserves of 4.4 Bcf. These reserves should be reported as proven and probable reserves.
Questerre Energy Corporation is a Calgary-based independent resource company actively engaged in the exploration, development and acquisition of high-impact exploration and development oil and gas projects in Canada.
Transeuro Energy Corp. is involved in the acquisition of petroleum and natural gas rights, the exploration for, and development and production of crude oil, condensate and natural gas. The Company’s properties are located in Canada, Armenia, Papua New Guinea and Ukraine.
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