TSXV Trading Symbol: SWE
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STATES/
CALGARY,
Feb. 25, 2014 /CNW/ - SilverWillow
Energy Corporation ("SilverWillow" or the "Corporation") is pleased
to announce an update to its estimate of Contingent Resources and
Discovered Bitumen Initially-In-Place following an independent
evaluation of the bitumen resources attributable to its oil sands
property, the Audet Lands, located approximately 110 km
northeast of Fort McMurray,
Alberta.
Sproule Unconventional Limited ("Sproule")
prepared the independent evaluation of the bitumen resources for
SilverWillow effective December 31,
2013. Sproule's work on the Audet Lands included a
review of the 2013 drilling program results, geological evaluation
and a review of the work conducted by SilverWillow's independent
consultants with respect to caprock integrity and reservoir
simulation, as well as preliminary engineering design and costing
studies to determine the potential for production of bitumen using
low pressure Steam Assisted Gravity Drainage ("SAGD") methods.
Sproule has assigned a best estimate of
Contingent Resources to the Audet Lands of 83.6 million barrels of
recoverable bitumen in place amounting to an increase of 15.2
million barrels or 22% over the prior year's best estimate of
Contingent Resources of 68.4 million barrels following a review of
the results from the 2013 drilling program. The estimate of
Discovered Bitumen Initially-In-Place has decreased 2% from 1,845.9
million barrels to 1,803.8 million barrels.
SilverWillow Energy Corporation
Contingent Bitumen Resources1
as of December 31, 2013
|
Developable-
Bitumen-
Initially-In-Place
(MMbbl) |
Recoverable-
Bitumen-
Initially-In-Place
(MMbbl) |
Recovery
Factor
(%) |
Low Estimate |
88.6 |
43.2 |
48.8 |
Best Estimate |
153.3 |
83.6 |
54.5 |
High Estimate |
284.8 |
171.9 |
60.4 |
1The term "contingent resources" is
taken from the Canadian Oil and Gas Evaluation Handbook ("COGEH")
as published by the Society of Petroleum Evaluation Engineers
(Calgary Chapter). The volumes listed in the chart above
entitled, "Contingent Bitumen Resources" refer to potentially
recoverable volumes of bitumen resources. The volumes of contingent
bitumen resources in the above chart are presented in millions of
barrels at stock tank conditions. There is no certainty that
it will be commercially viable to produce any portion of the
contingent bitumen resources.
SilverWillow has updated its investor
presentation to reflect this announcement. The presentation
is posted on SilverWillow's website at www.swenergy.ca.
Methodology
The preparation and disclosure of the reported
resource estimates are the responsibility of SilverWillow's
management and require approval by the Corporation's Reserves and
HSE Committee and Board of Directors. Sproule's
responsibility is to express an opinion on the contingent bitumen
resources based on the data provided by management. Sproule
carried out the evaluation and review in accordance with standards
established by National Instrument 51-101 Standards of Disclosure
for Oil and Gas Activities. These standards require that the
contingent resources estimates be prepared in accordance with
COGEH.
Discovered Petroleum Initially-In-Place
(equivalent to Discovered Resources) is defined in COGEH as that
quantity of petroleum that is estimated, as of a given date, to be
contained in known accumulations prior to production. The
recoverable portion of discovered petroleum initially-in-place
includes production, reserves, and contingent resources; the
remainder is unrecoverable.
Contingent Resources are defined in COGEH as
those quantities of petroleum estimated, as of a given date, to be
potentially recoverable from known accumulations using established
technology or technology under development, but which are not
currently considered to be commercially recoverable due to one or
more contingencies. Contingencies may include factors such as
economic, legal, environmental, political and regulatory matters or
a lack of markets. It is also appropriate to classify as
''contingent resources'' the estimated discovered recoverable
quantities associated with a project in the early project
stage.
With respect to the Contingent Resources
associated with SilverWillow's Audet Lands, the contingencies which
prevent the classification of these resources as reserves are as
follows: the need to verify the effectiveness of the McMurray
Formation shales as caprock for steam containment during the SAGD
operation; uncertainties regarding the regulatory requirements
applicable to the development of the Audet project; the absence of regulatory
approvals for future commercial development; the absence of a firm
commercial development plan; and the uncertainty of funding
approval for commercial developments.
Prior to commercial production from the Audet
Lands, which is not expected prior to late 2017, and is subject in
any event to the risks described in this section, SilverWillow will
have limited financial resources and a limited source of income,
principally in the form of asset sales and farm-outs.
SilverWillow anticipates making substantial capital expenditures
for the acquisition, exploration, evaluation, delineation,
development of and production from any potential project related to
its properties. There can be no assurance that debt or equity
financing, a bank loan facility or cash generated by operations
will be available or sufficient to meet these requirements or for
other corporate purposes or, if debt or equity financing is
available, that it will be on terms acceptable to SilverWillow.
The inability of SilverWillow to access
sufficient capital for its operations could have a material adverse
effect on SilverWillow's business, financial condition, results of
operations and prospects, could result in the delay or indefinite
postponement of further exploration, evaluation and development of
SilverWillow's properties or the possible loss of its properties
and could put at risk SilverWillow's ability to operate as a going
concern.
Capital requirements are subject to normal
capital market risks, primarily the availability and cost of
capital. The extent to which SilverWillow will need to access
additional funding will be subject to normal capital market risks,
primarily the availability and cost of capital.
Contingent Resources do not constitute and
should not be confused with reserves. There is no certainty
that it will be commercially viable to produce any portion of the
contingent resources on any of the above mentioned properties.
For further information including risk factors,
please see SilverWillow's Management Discussion and Analysis for
the period ended September 30, 2013
which was filed on SEDAR at www.sedar.com and the Corporation's
website at www.swenergy.ca.
About SilverWillow Energy
SilverWillow Energy Corporation is a
Calgary, Alberta based
pre-production oil sands company with a portfolio of exploration
leases in Canada's Athabasca oil sands. To learn more,
please visit www.swenergy.ca.
FORWARD-LOOKING INFORMATION: This news
release contains "forward-looking information" within the meaning
of applicable securities laws. Forward-looking information is
frequently characterized by words such as "plan", "expect",
"project", "intend", "believe", "anticipate", "estimate" and other
similar words, or statements that certain events or conditions
"may" or "will" occur. The forward-looking information in
this news release relates, but is not limited to, statements with
respect to the Corporation's plans for, and the economic viability
of, the development of a proposed 12,000 barrel per day SAGD
project. In addition information relating to "resources" is
forward-looking information, as it involves the implied assessment,
based on estimates and assumptions, that the resources described
exist in the quantities predicted or estimated, and can be
profitably produced in the future.
The forward-looking information set out in
this news release, is based on certain expectations and assumptions
regarding, among other things, the exploration and development of
the Audet Project and the Audet
Lands; the ability of the Corporation to obtain required regulatory
approval for the development of the Audet Project; the ability of
the Corporation to raise capital to fund the development of the
project; the geography of the areas in which SilverWillow will be
exploring; and the sufficiency of budgeted capital expenditures in
carrying out planned activities. These expectations and
assumptions are based on certain factors and events that are not
within the control of SilverWillow and there is no assurance they
will prove to be correct.
Forward-looking information is subject to
known and unknown risks and uncertainties and other factors which
may cause actual results, levels of activity and achievements to
differ materially from those expressed or implied in such
forward-looking information. Such risks, uncertainties and
factors include, among others, the risk that new regulatory
requirements may prevent the development of the Audet Project; the risk that, even if new
regulatory requirements do not restrict the development of the
Audet Project, regulatory approvals in respect of the Audet Project
will not be received in the timeframe or on the terms expected or
at all; risks relating to the early stage of development of
SilverWillow and the Audet Project; and the general risks
associated with exploring for, developing and producing
bitumen. In addition, there are numerous uncertainties
inherent in estimating bitumen, including many factors beyond the
Corporation's control, and no assurance can be given that the
indicated level of bitumen or the recovery thereof will be
realized. In general, estimates of bitumen are based upon a number
of factors and assumptions made as of the date on which the
resource estimates were determined, such as geological and
engineering estimates, which have inherent uncertainties.
Additional risks relating to the business and operations of
SilverWillow are set forth in the Corporation's TSX Venture
Exchange Listing Application and in its most recent Management's
Discussion and Analysis, which are filed under the Corporation's
profile on SEDAR at www.sedar.com.
SilverWillow undertakes no obligation to
update forward-looking information if circumstances or management's
estimates or opinions should change except as required by
law. The reader is cautioned not to place undue reliance on
forward looking information.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS
REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE
POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR
THE ADEQUACY OR ACCURACY OF THIS RELEASE
SOURCE SilverWillow Energy Corporation