Questerre's Utica has up to 4.28 tcf, says NSAI report
2009-09-01 06:19 ET - News Release
Mr. Anela Dido reports
QUESTERRE UTICA SHALE DISCOVERY ASSESSED AT OVER 4 TCF
Netherland, Sewell & Associates Inc. (NSAI), an independent reservoir engineering firm based in Texas, has estimated the prospective original gas in place for Questerre Energy Corp.'s Utica shale in the deep fairway in the St. Lawrence Lowlands at 150 billion cubic feet per square mile, which is 66 per cent higher than earlier industry figures. NSAI has further estimated Questerre's prospective recoverable resources to range between 2.2 trillion cubic feet to eight trillion cubic feet with a best estimate of 4.28 trillion cubic feet, equivalent to 360 million to 1.3 billion barrels of oil equivalent.
Michael Binnion, president and chief executive officer of Questerre, commented: "We are very pleased the report confirms the significance of our discovery in Quebec. This is the first time we have released estimates of our Utica gas discovery.
"We took time to ensure there is significant and material technical data to support them and we have had them independently verified by a highly reputable engineering firm. The estimates relate only to our lands that have geology validated by successful wells. The independent estimates are materially higher than past industry figures which we believe reflects the additional data, technical work and advancement on the learning curve."
The company commissioned NSAI to complete an evaluation of the resource potential of the Utica shale. Using its extensive expertise evaluating other established and emerging shale plays, the evaluation includes detailed petrophysical and geologic analysis, including a review of the available core and lab analysis data. Preliminary results have been prepared in accordance with the regulations pursuant to National Instrument 51-101, standards for disclosure for oil and gas activities of the Canadian securities administrators.
The evaluation is focused on the acreage between the two main geological features, the Yamaska growth fault and Logan's Line, where Questerre holds approximately 833,000 gross acres in the deep fairway. Preliminary results include:
- Prospective original gas-in-place (OGIP) volumes for the Utica shale range between 96 billion cubic feet to 210 billion cubic feet per square mile with a best estimate of 150 billion cubic feet per square mile.
- Total prospective OGIP volumes for Questerre's gross acreage are between a low estimate of 82.7 trillion cubic feet to a high estimate of 180.5 trillion cubic feet with a best estimate of 129.2 trillion cubic feet.
- Prospective resources estimated to be recoverable for Questerre's interest range from 2.18 trillion cubic feet to eight trillion cubic feet with a best estimate of 4.28 trillion cubic feet.
The assessment is being updated to include results from the recently completed St. Edouard No. 1 well that tested at rates of 700,000 cubic feet per day from the target middle Utica interval. A final report is expected this fall. The estimates do not include the gross overriding royalty held by Questerre nor an assessment of the shallower Lorraine interval.
OGIP is not a defined term within National Instrument 51-101 and is considered equivalent to petroleum initially in place (PIIP).
We seek Safe Harbor.
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