/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION
IN THE U.S./ CALGARY, Feb. 8, 2012 /CNW/ - Novus Energy Inc.
("Novus" or the "Company") is pleased to announce a substantial
increase to its reserves and production from its successful 2011
capital program. The Company is also pleased to release its
2012 production and capital budget guidance which demonstrates
another year of significant growth. The Company's year-end
independent reserve evaluation was prepared by Sproule Associates
Limited ("Sproule") effective December 31, 2011 (the "Sproule
Report"). 2011 Reserve Highlights -- Proved reserves at December
31, 2011 increased by 83% to 8.84 million boe, up substantially
from 4.83 million boe on December 31, 2010. -- Proved plus probable
reserves at December 31, 2011 increased by 58% to 14.56 million
boe, up from 9.24 million boe on December 31, 2010. -- The net
present value of proved plus probable reserves, before income tax
and discounted at 10%, increased 102% to $331.3 million up from
$164.2 million at December 31, 2010, representing an increase of
$167.1 million. -- The Company's fully diluted net asset value per
share increased dramatically to $1.64. -- Total proved reserves
increased 81% on a per share basis, and proved plus probable
reserves increased 56% on a per share basis. -- Oil and natural gas
liquids ("NGLs") at December 31, 2011 represent 82% of proved plus
probable reserves on a boe basis and 82% of total proved reserves.
-- Total proved reserves at December 31, 2011 represent 61% of
total proved plus probable reserves, up from 52% on December 31,
2010. -- Reserve replacement for the year was 839% on a proved plus
probable basis and 658% based on proved reserves. -- The Company's
Reserve Life Index at December 31, 2011 was 14.0 years on a proved
plus probable basis and 8.5 years on a proved basis (based on
annualized fourth quarter 2011 production). -- Finding, development
and acquisition costs, excluding future development capital
("FDC"), were $12.16/boe for proved plus probable reserves and
$15.51/boe for proved reserves. Including FDC, finding, development
and acquisition costs were $20.18/boe for proved plus probable
reserves and $25.66/boe for proved reserves. -- In the Dodsland
area of Saskatchewan, which encompasses the Company's core Viking
light oil properties, the 2011 capital program resulted in a 72%
increase in proved plus probable reserves. The Dodsland area
accounts for 13.3 million boe of proved plus probable reserves
which represent 91% of the Company's total proved plus probable
reserve volumes. -- Sproule has provided Novus with an updated
independent Contingent Resource Assessment for the Company's
Dodsland Viking light oil assets (the "Contingent Resource
Assessment"), the intent of which was to independently assess the
contingent resource potential of the area. The Contingent Resource
Assessment, effective as at December 31, 2011, reports a "best
estimate" of Discovered Petroleum Initially-In-Place ("DPIIP") on
Novus working interest and option lands totaling 644.8 million
barrels ("MMSTB") of light Viking oil, up 15% from November 30,
2010. This estimate consists of 527.9 MMSTB on Company owned land
and an additional 116.9 MMSTB on lands under option to Novus. 82%
of the DPIIP now reside on Novus working interest land up from 68%
at November 30, 2010. In the Contingent Resource Assessment,
approximately 56% of the net acreage controlled by Novus (56.9 net
sections owned and 9.9 net sections under option) was recognized by
Sproule as containing DPIIP. -- As part of the Contingent Resource
Assessment, Sproule included estimates of recoverable Contingent
Resource volumes beyond booked reserves captured in the December
31, 2011 reserve report. The Contingent Resource Assessment reports
a "best estimate" of Contingent Resources on Novus working interest
and option lands totaling 11.8 MMSTB, which are economic at current
prices and costs. This estimate consists of 7.9 MMSTB on Company
owned land and an additional 3.9 MMSTB on lands under option to
Novus. -- Total proved plus probable reserves plus the "best
estimate" of recoverable Contingent Resources represent
approximately 4% of the DPIIP. 2011 Operational Highlights -- The
Company began its 2012 drilling program on February 1, and has
drilled 2 wells to date. -- The Company's average production for
2011 was an estimated 1,971 boe/d, representing 77% year over year
average production volume growth. -- Novus achieved record
production of an estimated 2,845 boe/d in the fourth quarter of
2011 (83% oil and liquids) representing an 81% increase over fourth
quarter 2010 production volumes. -- Operating netbacks in the
fourth quarter of 2011 for the Company's Viking light oil
production in Dodsland were estimated to be a record $68.34/boe. --
Novus achieved a recycle ratio of 3.9 times for the current year
for proved plus probable reserves based on 2011 finding,
development and acquisition costs excluding FDC and a 2011
corporate operating netback of $47.17/boe. -- During 2011, Novus
achieved a 100% success rate on its Dodsland area Viking oil
drilling campaign. Novus operated the drilling of 52 wells
throughout the year, all using horizontal multi stage frac
technology. -- Results from the Company's Flaxcombe lands in the
Dodsland area continue to materially exceed expectations. In 2011,
Novus drilled 16 wells in the area with 90 day average rates,
excluding associated gas production volumes, of 64 bbls/d. -- Well
costs in the Dodsland area continued to decrease in 2011, with
costs for drilling and completions averaging approximately $835
thousand, tie-in costs averaging $95 thousand, and on stream costs
averaging $930 thousand per well. -- Novus currently controls 119
net sections of Viking rights, and has a risked drilling inventory
of 610 net, undrilled Viking oil locations based on eight well per
section spacing and the development of only one of the two distinct
cycles present on its Flaxcombe lands. 2012 Capital Program With
the continued success the Company has enjoyed with its large land
position in the Dodsland Viking light oil resource play of
southwestern Saskatchewan, the 2012 capital expenditure budget of
$81 million will exclusively be devoted to light oil development
drilling activity in the area. This budget will incorporate the
drilling of 73 wells (73 net), all of which will be horizontal
multi stage frac wells targeting Viking oil in Dodsland. In
addition to drilling, the Company is planning to expend capital on
facilities, pipelines and battery expansions in the Dodsland
area. No capital has been budgeted for acquisitions although
the Company continues to evaluate new opportunities within and
similar to its existing core area. Novus will have complete control
over its 2012 capital program, with 100% of budgeted expenditures
for the year being operated by the Company. Production Volumes The
2012 capital budget is expected to result in 2012 average
production of 3,300 boe/d (84% oil and liquids) which represents
growth of approximately 67% over the estimated 2011 average
production rate. The forecasted 2012 exit production rate is
4,500 boe/d, 85% of which will be oil and liquids. Financial
Position The Company ended the 2011 fiscal year with estimated net
debt of $49 million, against a line of credit of $60 million.
Novus will provide its lender with the Sproule Report and have its
credit facility reviewed in conjunction with finalizing its 2011
audited financial statements. Novus' 2012 capital budget will be
entirely funded through internally generated funds flow, proceeds
from in the money warrant exercises and its existing line of
credit. 2012 year end net debt is estimated to be
approximately $59 million, and would result in Novus having a debt
to annualized fourth quarter 2012 funds flow ratio of approximately
0.8 times. The Company expects to see positive funds flow
from operations of $52 million for 2012. This forecast is
based on an oil price of US $95.00 WTI per barrel, an AECO natural
gas price of CDN $2.50 per mmbtu, and an exchange rate of $1.00
CDN/US. At the end of 2011, Novus estimates it had in excess of
$230 million of tax pools which provide significant flexibility and
shelter for cash taxes in 2012 and future years. 2012 Guidance
Summary ((1)) Net Capital Expenditures $81 million Net Wells
Drilled 73 Average Production Volumes 3,300 boe/d (84% oil and
liquids) Exit Production Volumes 4,500 boe/d (85% oil and liquids)
Funds Flow From Operations $52 million Q4 Annualized Funds Flow
From $70 million Operations 2012 Estimated Year End Net Debt $59
million Crude Oil Pricing US $95.00 WTI Natural Gas Pricing CDN
$2.50 per mmbtu Exchange Rate $1.00 CDN/US (1) The projection of
capital expenditures excludes corporate and property acquisitions,
which are separately considered and evaluated. Key Viking Resource
Play Novus had a very active and highly successful year in 2011.
The large reserve additions the Company obtained were almost
exclusively generated in its key Viking light oil resource play in
Dodsland, Saskatchewan. Virtually all of the proved and
probable reserve growth the Company achieved came from organic
drilling. The attractive finding, development and acquisition
costs and healthy recycle ratio validate the growth strategy of
assembling a predictable, low risk, multi-year drilling inventory
within a concentrated core area. Novus begins 2012 with an
extensive light oil development drilling inventory of more than 600
net locations which represent over eight years of development
potential. This already significant opportunity base does not
reflect the ability to down space from 8 wells to 16 wells per
section or the future potential to water flood the reservoir.
Novus believes that the development of the Viking resource is in
its early stages and that there is further significant upside to
recovery factors by applying secondary recovery methods. Novus
shall continue to actively drill its existing land base, and shall
remain focused on expanding its presence within this large oil
resource play. Novus has been focused on continually lowering its
drilling and completion costs, employing new completion techniques
to improve the economic performance of its wells, and building the
necessary area infrastructure to support stable, low operating cost
production. Upgrades at Novus' owned and operated facilities
at Whiteside and Avon Hills were completed in the fourth quarter of
2011 which increased fluid handling capacities at each
facility. An exclusive agreement was signed with a third
party to take the Company's wet solution gas in Whiteside and will
significantly reduce operating costs. Construction of a sales
gas line and emulsion line from the Whiteside facility to the meter
station was also completed. Novus is currently running an emulsion
line from its core facility at Whiteside to the Flaxcombe field and
a total of 22 wells in the southern portion of the area will be
tied in and have their gas production conserved. This line will be
used to tie-in all new wells drilled in the Flaxcombe area
throughout 2012 and will serve to reduce downtime and reduce future
operating costs. Novus' operating costs have continued to
materially decrease from $18.20/boe in the first quarter of 2011 to
an estimated $12.88/boe in the fourth quarter of 2011. The
Company's fourth quarter 2011 operating costs for its Viking
production were estimated to be $8.96/boe, with further reductions
anticipated in the second quarter of 2012 once all facility
upgrades are completed. Based upon the stable production rates,
highly economic netbacks, significant recoverable reserves, and
lower drilling and completion costs in the Dodsland area the
Company has experienced to date, Novus plans on maintaining an
aggressive drilling program on its current acreage and will
continue its efforts to further consolidate and expand its position
within the area through acquisitions. With a strong technical
team and continual evolution by industry and the Company in
lowering costs and improving production in its Viking light oil
play, Novus is once again poised to exhibit strong growth in the
coming year. Land Holdings Of the total corporate net undeveloped
acres, 80% or 103,327 net acres are situated in Saskatchewan. A
summary of the Company's land holdings at December 31, 2011 is
outlined below: (acres) Developed Undeveloped Total Gross Net Gross
Net Gross Net Alberta 70,198 35,804 38,640 25,694 108,838 61,498
Saskatchewan 20,189 14,800 110,670 103,327 130,859 118,127 Other
1,943 1,347 1,943 932 3,886 2,279 Total 92,330 51,951 151,253
129,953 243,583 181,904 Reserves The reserves data set forth below
is based upon the Sproule Report. The following presentation
summarizes the Company's crude oil, natural gas liquids and natural
gas reserves and the net present values of future net revenue of
the Company's reserves before income taxes and using forecast
prices and costs. The Sproule Report has been prepared in
accordance with the standards contained in the COGE Handbook and
the reserves definitions contained in the NI 51-101. All
evaluations and reviews of future net cash flows are stated prior
to any provisions for interest costs or general and administrative
costs and after the deduction of estimated future capital
expenditures for wells to which reserves have been assigned. It
should not be assumed that the estimates of future net revenues
presented in the tables below represent the fair market value of
the reserves. There is no assurance that the forecast prices and
cost assumptions will be attained and variances could be material.
The recovery and reserve estimates of our crude oil, natural gas
liquids and natural gas reserves provided herein are estimates only
and there is no guarantee that the estimated reserves will be
recovered. Actual crude oil, natural gas and natural gas liquids
reserves may be greater than or less than the estimates provided
herein. Light and Medium Heavy Oil Natural Gas Natural Gas Barrels
of oil Oil Liquids equivalent Gross Net Gross Net Gross Net Gross
Net Gross Net (Mbbl) (Mbbl) (Mbbl) (Mbbl) (Mbbl) (Mbbl) (Mmcf)
(Mmcf) (Mboe) (Mboe) Proved Producing 2,223.9 1,982.6 36.7 30.2
92.4 62.1 2,952 2,586 2,845.0 2,505.9 - - - - 3.4 2.8 1,357 1,074
229.5 181.8 Non-Producing Undeveloped 4,817.0 4,303.6 25.0 20.6
16.4 14.1 5,470 4,973 5,770.2 5,167.1 Total Proved 7,040.9 6,286.2
61.7 50.9 112.2 79.0 9,779 8,633 8,844.6 7,854.8 Probable 4,533.4
4,136.4 108.6 89.6 56.2 39.6 6,084 5,459 5,712.2 5,175.5 Total
Proved 11,574.3 10,422.6 170.3 140.5 168.4 118.6 15,863 14,092
14,556.8 13,030.3 plus Probable Notes: 1. "Gross" means the
Company's reserves before calculation of royalties, and before
consideration of the Company's royalty interests. 2. "Net" means
the Company's reserves after deduction of royalty obligations, and
including the Company's royalty interests. 3. Oil equivalent
amounts have been calculated using a conversion rate of six
thousand cubic feet of natural gas to one barrel of oil. 4. Columns
may not add due to rounding. Reserves Values The estimated before
tax future net revenues associated with the Company's reserves,
effective December 31, 2011 and based on Sproule's December 31,
2011 future price forecast, are summarized in the following table:
(M$) 0% 5% 10% 15% 20% Proved Producing 127,892 112,869 101,459
92,548 85,416 Non-Producing 1,615 668 57 (355) (644) Undeveloped
165,559 122,897 92,387 70,047 53,332 Total Proved 295,066 236,434
193,903 162,240 138,105 Probable 275,598 189,629 137,376 103,762
81,046 Total Proved plus Probable 570,664 426,063 331,279 266,002
219,151 Notes: 1. Net present value of future net revenue includes
all resource income: o Sale of oil, gas, and by-product reserves o
Processing third party reserves o Other income 2. Values are based
on net reserve volumes 3. Columns may not add due to rounding Price
Forecast The December 31, 2011 Sproule price forecast is summarized
as follows: $US/$Cdn WTI @ AB Edmonton Hardisty Natural Gas at Year
Exchange Rate Cushing Light Bow River AECO-C Spot (US$/bbl)
(C$/bbl) (C$/bbl) (C$/Mmbtu) 2012 1.012 98.07 96.87 82.34 3.16 2013
1.012 94.90 93.75 79.69 3.78 2014 1.012 92.00 90.89 77.25 4.13 2015
1.012 97.42 96.23 81.80 5.53 2016 1.012 99.37 98.16 83.44 5.65 2017
1.012 101.35 100.12 85.10 5.77 2018 1.012 103.38 102.12 86.81 5.89
2019 1.012 105.45 104.17 88.54 6.01 2020 1.012 107.56 106.25 90.31
6.14 2021 1.012 109.71 108.38 92.12 6.27 2022+ 1.012 +2.0%/yr
+2.0%/yr +2.0%/yr +2.0%/yr Note: Inflation is accounted for
at 2% per year. Finding, Development and Acquisition Costs
("FD&A") Novus' F&D and FD&A costs for 2011, 2010 and
the three year average are presented in the tables below. The costs
used in the F&D and FD&A calculation are the capital costs
related to: land acquisition and retention; drilling; completions;
tangible well site equipment; tie-ins; facilities; and other costs,
plus the change in estimated FDC as per the independent reserve
report, inclusive of the effects of the Alberta Drilling Royalty
Credit program. Acquisition costs are net of any proceeds from
dispositions of properties. Due to the timing of capital
costs and the subjectivity in the estimation of further costs, the
aggregate of the exploration and developments costs incurred in the
most recent financial year and the change during that year in
estimated future development costs generally will not reflect total
finding and development costs related to reserve additions for that
year (all figures in the following tables are in thousands of
dollars unless otherwise stated). Finding & Development Costs -
Proved 3 Year (000's, except $/boe amounts) 2011 2010 Average
Capital expenditures (excluding acquisitions and dispositions)
$73,990 $53,711 $44,358 Change in future development capital 53,657
77,895 45,142 Total capital for F&D 127,647 131,606 89,500
Reserve additions, excluding acquisitions and dispositions 4,665.1
3,333.8 2,793.8 Proved F&D costs - including future development
capital ($/boe) 27.36 39.48 32.04 Proved F&D costs - excluding
future development capital ($/boe) 15.86 16.11 15.88 Finding &
Development Costs - Proved plus probable 3 Year (000's, except
$/boe amounts) 2011 2010 Average Capital expenditures (excluding
acquisitions and dispositions) $73,990 $53,711 $44,358 Change in
future development capital 58,889 105,102 56,330 Total capital for
F&D 132,879 158,813 100,688 Reserve additions, excluding
acquisitions and dispositions 5,896.4 6,382.9 4,236.6 Proved plus
probable F&D costs - including future development capital
($/boe) 22.54 24.88 23.77 Proved plus probable F&D costs -
excluding future development capital ($/boe) 12.55 8.41 10.47
Finding, Development & Acquisition Costs - Proved 3 Year
(000's, except $/boe amounts) 2011 2010 Average Capital
expenditures (including acquisitions, net of dispositions) $73,411
$68,349 $56,738 Change in future development capital 48,052 83,509
46,212 Total capital for FD&A 121,463 151,858 102,950 Reserve
additions, including net acquisitions 4,734.2 3,770.3 3,038.2
Proved FD&A costs - including future development capital
($/boe) 25.66 40.28 33.89 Proved FD&A costs - excluding future
development capital ($/boe) 15.51 18.13 18.67 Finding, Development
& Acquisition Costs - Proved plus probable 3 Year (000's,
except $/boe amounts) 2011 2010 Average Capital expenditures
(including acquisitions, net of dispositions) $73,411 $68,349
$56,738 Change in future development capital 48,416 115,584 58,150
Total capital for FD&A 121,827 183,933 114,888 Reserve
additions, including net acquisitions 6,037.6 7,138.4 4,676.5
Proved plus probable FD&A costs - including future capital
($/boe) 20.18 25.77 24.57 Proved plus probable FD&A costs -
excluding future capital ($/boe) 12.16 9.57 12.13 Notes: 1. The
reserves used in the above calculations are Company gross reserves
additions, including revisions. 2. The 2011 capital expenditures
used in the above calculations are unaudited as the Company's 2011
annual financial statements are in the process of being finalized.
These numbers and calculations thereon are subject to change upon
completion of the audit. Reserves Replacement Novus' 2011 FD&A
activities replaced 839% of production on a proved plus probable
basis and 658% on a proved basis. Production (Mboe) 719.2 Proved
plus probable reserve additions (Mboe) 6,037.6 Proved plus probable
reserve replacement 839% Proved reserve additions (Mboe) 4,734.2
Proved reserve replacement 658% Net Asset Value Summary (000's,
except per share amounts) December 31, 2011 Proved plus probable
reserves(1) $331,279 Net undeveloped land(2) 32,488 Dilutive
proceeds 32,939 Net debt (49,000) Total Net Asset Value $347,706
Number of fully diluted shares 212,035 Net asset value per share
$1.64 Notes: 1. Before tax, discounted at 10%. 2. Net undeveloped
land has been valued at $250/acre. 3. No value has been assigned to
seismic or intangible assets. Outlook Novus' strategic direction
remains unchanged. The Company is competitively positioned in
the repeatable, low risk, highly economic Viking oil resource play
in West Central Saskatchewan with 119 net sections of land and 610
net risked drilling locations. The core of the Company's
development program in 2012 and beyond will focus on further
exploitation of its sizeable opportunity base. The Company's
priorities in 2012 are: -- Use its strong balance sheet to fund a
non-dilutive drilling program which will maintain the Company's
impressive annual growth profile; -- Continue to improve operating
efficiencies through further reductions in its cost structure; --
Continue to grow the Company's production and reserves on a per
share basis; and -- Evaluate opportunities to continually increase
its oil resource focus through further acquisitions. Novus Energy
Inc. is a well positioned, junior oil and gas company with a proven
management team committed to aggressive, cost-effective growth of
high netback light oil reserves and production. Novus will continue
to grow through a targeted acquisition and consolidation strategy
coupled with development and exploration drilling. Novus' strong
financial position and unused line of credit will allow for the
exploitation of its drilling inventory and expansion of the
Company's opportunity suite through internally generated prospects
and strategic light oil acquisitions. Novus Shares trade on the TSX
Venture Exchange under the symbol NVS. Novus currently has 175.7
million common shares outstanding. Measurements Reported production
represents Novus' ownership share of sales before the deduction of
royalties. Where amounts are expressed on a barrel of oil
equivalent ("boe") basis, natural gas has been converted at a ratio
of six thousand cubic feet to one boe. This ratio is based on
an energy equivalency conversion method primarily applicable at the
burner tip and does not represent a value equivalency at the
wellhead. Boe's may be misleading, particularly if used in
isolation. References to natural gas liquids ("liquids")
include condensate, propane, butane and ethane and one barrel of
liquids is considered to be equivalent to one boe. 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. This
news release will not constitute an offer to sell or the
solicitation of an offer to buy the securities in any jurisdiction.
Such securities have not been registered under the United States
Securities Act of 1933 and may not be offered or sold in the United
States, or to a U.S. person, absent registration, or an applicable
exemption therefrom. Advisory Regarding Forward-Looking Statements
The information provided above includes references to discovered
and undiscovered oil and natural gas resources. There is no
certainty that any portion of the resources will be discovered. If
discovered, there is no certainty that it will be commercially
viable to produce any portion of the resource. This press release
contains forward-looking statements and forward-looking information
within the meaning of applicable securities laws. The use of any of
the words "expect", "anticipate", "continue", "estimate",
"objective", "ongoing", "may", "will", "project", "should",
\"believe", "plans", "intends" and similar expressions are intended
to identify forward-looking information or statements. More
particularly and without limitation, this press release contains
forward looking statements and information concerning the company's
petroleum and natural gas production; reserves; undeveloped land
holdings; business strategy; future development and growth
opportunities; prospects; asset base; future cash flows; value and
debt levels; capital programs; treatment under tax laws; and oil
and natural gas prices. The forward-looking statements and
information are based on certain key expectations and assumptions
made by Novus, including expectations and assumptions concerning
prevailing commodity prices and exchange rates, applicable royalty
rates and tax laws; future well production rates and reserve
volumes; the performance of existing wells; the success obtained in
drilling new wells; the sufficiency of budgeted capital
expenditures in carrying out planned activities; and the
availability and cost of labour and services. Although Novus
believes that the expectations and assumptions on which such
forward-looking statements and information are based are
reasonable, undue reliance should not be placed on the forward
looking statements and information because Novus can give no
assurance that they will prove to be correct. Since forward-looking
statements and information address future events and conditions, by
their very nature they involve inherent risks and uncertainties.
Actual results could differ materially from those currently
anticipated due to a number of factors and risks. These include,
but are not limited to, the risks associated with the oil and gas
industry in general such as operational risks in development,
exploration and production; delays or changes in plans with respect
to exploration or development projects or capital expenditures; the
uncertainty of reserve estimates; the uncertainty of estimates and
projections relating to reserves, production, costs and expenses;
health, safety and environmental risks; commodity price and
exchange rate fluctuations; marketing and transportation; loss of
markets; environmental risks; competition; incorrect assessment of
the value of acquisitions; failure to realize the anticipated
benefits of acquisitions; ability to access sufficient capital from
internal and external sources; failure to obtain required
regulatory and other approvals; and changes in legislation,
including but not limited to tax laws, royalties and environmental
regulations. Readers are cautioned that the foregoing list of
factors is not exhaustive. Additional information on these and
other factors that could affect Novus' operations or financial
results are included in reports on file with applicable securities
regulatory authorities and may be accessed through the SEDAR
website (www.sedar.com), and at Novus' website
(www.novusenergy.ca). The forward-looking statements and
information contained in this press release are made as of the date
hereof and Novus undertakes no obligation to update publicly or
revise any forward-looking statements or information, whether as a
result of new information, future events or otherwise, unless so
required by applicable securities laws. Special Note Regarding
Disclosure of Reserves or Resources "Discovered Petroleum
Initially-In-Place" (equivalent to discovered resources) is defined
in the Canadian Oil and Gas Evaluation Handbook 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 the COGE Handbook as those
quantities of petroleum estimated 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 evaluation stage. The Contingent Resources
estimates and the DPIIP estimates are estimates only and the actual
results may be greater than or less than the estimates provided
herein. There is no certainty that it will be commercially viable
to produce any portion of the resources except to the extent
identified as proved or probable reserves. "Best estimate" is
defined in the COGE Handbook with respect to entity-level
estimates, as the value derived by an evaluator using deterministic
methods that best represent the expected outcome with no optimism
or conservatism. If probabilistic methods are used, there should be
at least a 50 percent probability (P50) that the quantities
actually recovered will equal or exceed the best estimate.
Novus Energy Inc. CONTACT: NOVUS ENERGY
INC.Hugh G. RossPresident and CEO(403) 218-8895Ketan
PanchmatiaChief Financial Officer(403) 218-8876Julian DinVP
Business Development(403) 218-8896
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