Southern Pacific Resource Corp. says that the estimate of the total proved plus probable (2P) recoverable heavy oil reserves within its 100%-owned Senlac Thermal Project in Saskatchewan has increased 14% from the previous estimate to 10.4 million barrels (MMbbl).

This equates to a net present value before tax of $193.9 million (discounted at 10% based on April 1, 2010 forecast pricing). Additionally, 20.8 MMbbl of recoverable oil at Senlac has been assigned to the total proved plus probable plus possible (“3P”) reserves category, an increase of 33%. The 3P reserves have a corresponding net present value before tax of $334.2 million (discounted at 10% based on April 1, 2010 forecast pricing).

The updated reserves report for Senlac was completed by GLJ Petroleum Consultants of Calgary (“GLJ”) effective April 1, 2010. This is the first independent reserves evaluator’s report completed on Senlac since Southern Pacific acquired the property on November 3, 2009 for a purchase price of $89.3 million after adjustments. A summary of the previous reserves evaluation effective December 31, 2008 is included in a material change report filed by Southern Pacific on SEDAR on October 9, 2009.

Senlac has produced a total of approximately 2.1 MMbbl of heavy oil between the effective dates of the two reserves reports. Southern Pacific attributes the increase in reserves to better performance from existing wells and the wells drilled subsequent to the December 2008 report.

Tags: Southern Pacific Resource