CALGARY, ALBERTA — (Marketwire) — 03/04/13 — Alexander Energy Ltd. (TSX VENTURE: ALX), (“Alexander” or the “Company”) announces that at December 31, 2012 Alexander–s estimated proved plus probable reserves were comprised of 61 per cent oil and natural gas liquids and 39 per cent natural gas, and the Company replaced 169% of 2012 production on a proved plus probable basis.
The Company had the following increases in the 2012 reserves evaluation from the 2011 reserves evaluation:
McDaniel & Associates Consultants Ltd. (McDaniel) of Calgary, Alberta, an independent qualified reserves evaluator, prepared a reserves assessment and economic evaluation effective December 31, 2012, in respect of Alexander–s oil and natural gas properties, which is contained in a report dated March 4, 2013. McDaniel also prepared Alexander–s reserves evaluation effective December 31, 2011. Reserves estimates stated herein as at December 31, 2012, and 2011 are extracted from the relevant evaluation.
Reserves summary
The table below summarizes McDaniel–s estimates of Alexander–s working-interest oil and natural gas reserves at December 31, 2012, and December 31, 2011, using the McDaniel forecast price assumptions in effect at the applicable evaluation date. Reserves included herein are stated on a Company gross basis (working interest before deduction of royalties) unless otherwise noted.
Summary of Working-Interest Oil and Natural Gas Reserves at December 31, 2012, and December 31, 2011
Net present value of future net revenue
The table below shows a summary of the net present value of future net revenue associated with Alexander–s reserves at December 31, 2012 before deducting future income taxes. The net present value of future net revenue attributable to the Company–s reserves is based on McDaniel–s December 31, 2012 forecast price assumptions of commodity prices, which can be found at McDaniel–s website at .
Despite a significant decrease in forecast commodity prices from December 31, 2011 to December 31, 2012 Alexander increased the Net Present Value of total proved reserves by 24%.
The December 31, 2012 and 2011 reserves evaluations of Alexander have been prepared in accordance with the definitions, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook (COGEH) and National Instrument 51-101 — Standards of Disclosure for Oil and Gas Activities.
Forecast Prices
The table below shows a summary of McDaniel–s forecast price assumptions of commodity prices for calendar 2013 at December 31, 2012 and 2011.
A complete filing of the Company–s 2012 Statements of Reserves Data and Other Oil and Gas Information (form 51-101F1), Report on Reserves Data by Independent Qualified Reserves Evaluator or Auditor (form 51-101F2) and Report of Management and Directors on Oil and Gas Disclosure (form 51- 101F3), will be filed on the Company–s SEDAR profile at prior to the end of April 2013. The corresponding filings of the 2011 reserves documentation is also available on the Company–s profile at .
Forward-Looking Statements: All statements, other than statements of historical fact, set forth in this news release, including without limitation, assumptions and statements regarding the volumes and estimated value of the Company–s proved and probable reserves, future production rates, exploration and development results, financial results, and future plans, operations and objectives of the Company are forward-looking statements that involve substantial known and unknown risks and uncertainties. Some of these risks and uncertainties are beyond management–s control, including but not limited to, the impact of general economic conditions, industry conditions, fluctuation of commodity prices, fluctuation of foreign exchange rates, environmental risks, industry competition, availability of qualified personnel and management, availability of materials, equipment and third party services, stock market volatility, timely and cost effective access to sufficient capital from internal and external sources. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.
These assumptions and statements necessarily involve known and unknown risks and uncertainties inherent in the oil and gas industry such as geological, technical, drilling and processing problems and other risks and uncertainties, as well as the business risks discussed in Management–s Discussion and Analysis of the Company under the heading “Business Risks”. The Company does not undertake any obligation, except as required by applicable securities legislation, to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise.
Barrels of oil equivalent (boe) is calculated using the conversion factor of 6 mcf (thousand cubic feet) of natural gas being equivalent to one barrel of oil. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf:1 bbl (barrel) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.
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Contacts:
Alexander Energy Ltd.
Hugh M. Thomson
Vice-President Finance and Chief Financial Officer
(403) 523-2505
(403) 264-1348 (FAX)
Alexander Energy Ltd.
1540, 521-3rd Avenue S.W. Calgary, Alberta T2P 3T3