Adira Energy Ltd. announced it has received an independent resource report (the Report) including a best estimate in aggregate of 65.8 million barrels (MMbbl) of oil and 65.8 billion cubic feet (BCF) of gas in four structures on the Company’s Samuel License (the License) located offshore Israel. The Report was prepared by Netherland, Sewell & Associates, Inc. (NSAI) of Houston, Texas and is available on SEDAR (www.sedar.com).
NSAI conducted an assessment of the Gross (100%) Unrisked Prospective Resources located in the #388/ Samuel block as of October 17, 2012. Approximately 42 km2 of 3D seismic data was acquired in 2011 for the License using state of the art Ocean Bottom Cable (OBC) and processing technology.
The following is a summary of the findings of the Report as of October 17, 2012:
Summary of Best Estimate Prospective (1) Resources:
- Hydrocarbon: Best Estimate Gross
- Light/Medium Oil: 65.8 MMbbl
- Gas: 65.8 BCF
(1) 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. The prospective resources included in this report indicate exploration opportunities and development potential in the event a petroleum discovery is made and should not be construed as reserves or contingent resources. There is no certainty that any portion of the prospective resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the prospective resources.
The prospective resources shown in the table above have been estimated using probabilistic methods and are dependent on a petroleum discovery being made. If a discovery is made and development is undertaken, the probability that the recoverable volumes will equal or exceed the unrisked estimated amounts above for the low estimate is 90%, for the best estimate is 50% and the high estimate is 10%. Based on analogous field developments, with the assumption a discovery is made, the unrisked best estimate prospective resources on the Samuel block has a reasonable chance of being commercial.
Jeffrey E. Walter, Chief Executive Officer commented: “With a Best Estimate gross of 65.8 MMbbl the report from Netherland Sewell clearly defines that Adira has additional oil exploration opportunities in the emerging Syrian Arc oil trend of the Levant Basin. The initial well will target the Cretaceous section, which is estimated to contain almost 38 million barrels of prospective oil equivalent on a gross unrisked basis. Adira and its partners will continue to review the deeper Jurassic section, which NSAI estimates has the potential of 38 million barrels of prospective unrisked oil equivalent. Samuel is the third license in the Adira portfolio and continues to expand Adira’s access to the significant oil opportunities offshore Israel”
Samuel License
The Samuel License covers a total area of approximately 360 square kilometers (or 89,205 acres) and is in relatively shallow water with depths between 30 and 100 meters.
Adira’s net interest in the Samuel License is 41.25%, of which 23.25% is held through its 100% owned Canadian subsidiary Adira Oil Technologies Ltd. and 18% of which is held through it’s 60% held subsidiary Adira GeoGlobal Ltd. In addition, the Company is entitled to receive one-half of an aggregate operating fee equal to 7.5% of the cumulative direct costs incurred in connection with operating the Samuel License and one-half of 3% over-riding royalty to be paid by partners other than the Company and GeoGlobal Resources (India) Inc.
