TORONTO, ONTARIO — (Marketwire) — 03/13/12 — Brownstone Energy Inc. (TSX VENTURE: BWN)(OTCQX: BWSOF) (“Brownstone” or the “Company”) today announced that it has received two independent resource reports (collectively the “Reports”) including a best estimate in aggregate of 232.2 million barrels (“MMbbl”) of oil and condensate, including 110.1 MMbbl of contingent oil, and 1.8 TCF of gas on the Company–s Gabriella License and Yitzhak License (collectively, the “Licenses”) located offshore Israel. The Reports were prepared by Netherland, Sewell & Associates, Inc. (“NSAI”) of Houston, Texas.
NSAI conducted an assessment of the Gross (100%) Contingent and Unrisked Prospective Resources located in the #378 / Gabriella block and the Gross (100%) Unrisked Prospective Resources in the #380 / Yitzhak block, both as of March 1, 2012. Approximately 465-km2 of 3D seismic data was acquired in 2010 and 2011 for the Licenses. The data was shot on an azimuth of 23 degrees and was processed by CGG Veritas. This survey was processed with another smaller 197-km2 3-D seismic survey shot on an azimuth of 343 degrees.
The following is a summary of the findings of the Reports:
Summary of Best Estimate Contingent(1) and Prospective(2) Resources as of March 1, 2012:
Sheldon Inwentash, CEO of Brownstone Energy comments: “The Netherland and Sewell independent evaluations of our offshore Israel Gabriella and Yitzhak blocks further confirm that Brownstone has significant high impact exploration projects in our portfolio of world class assets.
The upcoming exploration well on the Gabriella block will target the same Jurassic carbonates that tested oil in the Yam Yafo 1 well that was previously drilled on the block in 1994. As a result, Netherland and Sewell have classified these resources on the Gabriella block as contingent resources, with a gross best estimate of 110.1 MM barrels of oil. If we include associated gas, the total gross number increases to 128.4 MM barrels of oil equivalent.
On our Yitzhak block, where we are also progressing our drilling plans, Netherland and Sewell has used our newly acquired and interpreted high resolution 3D seismic data to significantly increase previous gross prospective resource estimates to 79.1 MM barrels of oil. If we include associated gas, the total gross number increases to 92.3 MM barrels of oil equivalent. Netherland and Sewell have given the Yitzhak block a 40% chance of geologic success, as it is adjacent to, and similar to, the Gabriella prospect which has already tested oil in the same Jurassic carbonates we are targeting here.
Cumulatively, the Gabriella and Yitzhak blocks hold a gross total of 220.7 MM barrels of oil equivalent resources within the Jurassic carbonates, with Brownstone holding an unencumbered 15% working interest in each block. As we move forward with our drilling plans we note that analogous projects with similar geologic and technical parameters have been successfully commercialized in many jurisdictions around the world.”
Gabriella License – Contingent Resources
The Gabriella License is located approximately 24 kilometers northwest of Tel Aviv, in the waters offshore Israel. The block covers an area of approximately 390 square kilometers (97,000 acres) and is in water depths that range from 100 meters on the east side of the block to just over 425 m on the southwest side of the block. One well, the Yam Yafo 1, has been drilled on the block (in 1994).
The estimated gross (100%) contingent resources from the Jurassic Formation, as of March 1, 2012 are:
Summary of Gross (100 percent) Contingent Resource(1) Estimates, Jurassic Oil Prospects
Gabriella License – Prospective Resources
The estimated unrisked gross (100%) prospective gas resources for these prospective reservoirs, as of March 1, 2012 are:
Summary of Gross (100 percent) Prospective Resource(1) Estimates of Prospective Reservoirs
The table below illustrates the geological risk elements and overall probability of geological success for each of the three prospective reservoirs.
Risk Elements
Each reservoir was evaluated to determine ranges of in – place and recoverable petroleum and was risked as an independent entity without dependency between potential perspective reservoir drilling outcomes.
Yitzhak License – Prospective Resources
The Yitzhak License is located approximately 38 kilometers north northwest of Tel Aviv, in the waters offshore Israel. The block covers an area of approximately 128 square kilometers (31,630 acres) and is in water depths that range from 75 meters on the east side of the block to just over 225 m on the west side of the block. Two wells, the Delta 1, and Delta 1A have been drilled on the block.
The estimated gross (100%) prospective resources from the Jurassic Formation, as of March 1, 2012 are:
Summary of Gross (100 percent) Prospective Resource(1) Estimates of Prospective Reservoirs
The table below illustrates the geological risk elements and overall probability of geological success for each of the three prospective reservoirs.
Risk Elements
The estimates in this report have been prepared in accordance with the definitions and guidelines set forth in Canadian National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities and Section 5 of Volume 1, Second Edition, of the Canadian Oil and Gas Evaluation Handbook (COGEH), prepared jointly by the Society of Petroleum Evaluation Engineers (Calgary Chapter) and the Canadian Institute of Mining, Metallurgy & Petroleum (Petroleum Society) (the latter of which is now the Petroleum Society of Canada).
Gabriella and Yitzhak Working Interests
In the Gabriella license, Brownstone holds a Working Interest of 15%.
In the Yitzhak license, Brownstone holds a Working Interest of 15%.
About Brownstone
Brownstone Energy Inc. is a Canadian-based, energy focused company with direct interests in oil and gas exploration projects, including varying interests in three off-shore Israel concessions and in four Colombian blocks in the Llanos basin, as well as other oil and gas interests worldwide. By owning and managing a diversified portfolio of energy-based projects, Brownstone provides shareholders with a unique energy alternative. For additional information, please see Brownstone–s website: .
Cautionary Statements
This news release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws (together, “forward-looking information”). The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “believe”, “plans”, “intends”, “confident”, “may”, “objective”, “ongoing”, “will”, “should”, “project”, “should” and similar expressions are intended to identify forward-looking information.
The forward-looking information is based on certain key expectations and assumptions made by the Company, including expectations and assumptions concerning the operational results in Israel. Although the Company believes that the expectations and assumptions on which the forward-looking information are based are reasonable, undue reliance should not be placed on the forward-looking information because the Company can give no assurance that they will prove to be correct.
Since forward-looking information addresses future events and conditions, by its very nature it involves inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the inherent risks involved in the exploration and development of oil and gas properties, the uncertainties involved in interpreting drilling results and other geological data, uncertainties relating to fluctuating oil and gas prices, the possibility of cost overruns or unanticipated costs and expenses and other factors including unforeseen delays. Anticipated exploration and development plans relating to the Company–s properties are subject to change.
The foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking information contained in this press release is made as of the date hereof and Brownstone undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Brownstone Energy Inc.
Jonathan Schroeder, P. Geoph.
President and COO
(403) 660-2894
Brownstone Energy Inc.
Gerry Feldman
CFO
(416) 941-8900
Brownstone Energy Inc.
Richard Patricio
Vice-President Corporate and Legal Affairs
(416) 941-8900