CALGARY, Alberta, October 19, 2010 /PRNewswire-FirstCall/ -- Sterling Resources Ltd. (TSX-V:SLG) ("Sterling" or the "Company") is pleased to announce updated Contingent and Prospective Resource numbers (100 percent) for the Cladhan discovery (UKCS Blocks 210/29a and 210/30a) as a result of recently announced drilling success of two sidetracks from the original discovery well 210/29a-4. These Contingent and Prospective Resource figures (100 percent) have been evaluated by RPS Energy as at October 15, 2010.
P50 Contingent Resources have increased from 30 million barrels Oil in Place (OIP) to 89 million barrels OIP.
Unrisked Contingent (1) Resources (100 percent) MMbbls OIP P90 (1C) (3) P50 (2C) (3) P10 (3C) (3) At December. 31, 2009 12 30 76 At October 15, 2010 43 89 155
P50 Prospective Resources have increased from 65 million barrels OIP to 93 million barrels OIP in the previously assessed terrace area. An additional 74 million barrels OIP of P50 Prospective Resources is attributable to an area off the terrace and in a fan system to the east previously not assessed by RPS Energy.
Unrisked Prospective (2) Resources (100 percent) MMbbls OIP P90 (Low Estimate) (3) P50 (Best Estimate) P10 (High (3) Estimate) (3) At December 31, 2009 23 65 158 At October 15, 2010: In Channels 44 93 168 In Fan 32 74 143
"These revised Contingent and Prospective Resources numbers independently confirm the magnitude of our recent drilling successes at Cladhan," stated Mike Azancot, Sterling's President and CEO. "The significant upward revisions from just two new data points in high quality sands in which we have yet to find an oil water contact indicate the large potential for Cladhan. Additional drilling will be required to further delineate the size of this discovery," added Mr. Azancot.
Subject to the completion of site survey work already in progress, conclusion of the rig selection process and regulatory approval from the UK Department of Energy and Climate Change (DECC), the Company anticipates performing another drilling campaign at Cladhan during the first quarter of 2011. The Company is also initiating evaluation work for potential development scenarios.
Sterling is the operator of Cladhan (License P1064) and holds a 39.9 percent working interest through wholly-owned Sterling Resources (UK) Ltd. The other partners are Wintershall (UK North Sea) with a 33.5 percent working interest, Encore Petroleum Ltd. with a 16.6 percent working interest and Dyas UK Ltd. with a 10 percent working interest.
1. Contingent Resources are 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 evaluation stage. Specific contingencies preventing the classification of the resources as reserves are further definition of resource volumes through further appraisal drilling, regulatory approvals and sanction, and selection of a specific field development concept, including the most viable crude offtake delivery routing and oil sales contracts.
2. Prospective Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective Resources have both an associated chance of discovery and a chance of development.
3. The P50 or 2C is considered to be the best estimate of the quantity that will actually be recovered. 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 estimate. Similarly, the 1C or P90 and 3C or P10 represent the low and high estimates respectively.
As with all oil and gas fields at this early stage of appraisal, there are significant positive and negative factors which may impact the resource volumes for Cladhan. There is a significant range of uncertainty associated with the resource volumes due to variations in geological properties, reservoir petrophysical properties and potential well flow rates in the undrilled portions of the reservoir structure.
In the case of discovered resources or a subcategory of discovered resources there is no certainty that it will be commercially viable to produce any portion of the resources. In the case of undiscovered resources or a subcategory of undiscovered 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 resources.
Sterling Resources Ltd. is a Canadian-listed international oil and gas company headquartered in Calgary, Alberta with assets in the United Kingdom, Romania, and France. The shares are listed and posted for trading on the TSX Venture Exchange under the symbol "SLG".
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
All statements included in this press release that address activities, events or developments that Sterling expects, believes or anticipates will or may occur in the future are forward-looking statements. In addition, statements relating to reserves or resources are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves and resources described can be profitably produced in the future.
These forward-looking statements involve numerous assumptions made by Sterling based on its experience, perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances. In addition, these statements involve substantial known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other-forward looking statements will prove inaccurate, certain of which are beyond Sterling's control, including: the impact of general economic conditions in the areas in which Sterling operates, civil unrest, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. In addition there are risks and uncertainties associated with oil and gas operations. Readers should also carefully consider the matters discussed under the heading "Risk Factors" in the Company's Annual Information Form.
Undue reliance should not be placed on these forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. Sterling's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements. These statements speak only as of the date of the press release. Sterling does not intend and does not assume any obligation to update these forward-looking statements except as required by law.
Financial outlook information contained in this press release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management's assessment of the relevant information currently available. Readers are cautioned that such financial outlook information contained in this press release should not be used for purpose other than for which it is disclosed herein.
For further information:
visit http://www.sterling-resources.com or contact:
Mike Azancot, President and Chief Executive Officer, Phone: +44-1330-826764, Mobile: +44-7740-432883, firstname.lastname@example.org
David Blewden, Chief Financial Officer, Phone: +44-1330-826766, Mobile: +44-7771-740804, email@example.com
George Kesteven, Manager, Corporate and Investor Relations, Phone: +1(403)215-9265, Fax: +1(403)215-9279, firstname.lastname@example.org
SOURCE Sterling Resources Ltd.