California-based NiMin Energy (TSE:NNN)(OTCQX:NEYYF) announced Friday a 45% increase in proved reserves largely due to positive drilling activity in Wyoming.
The company rose more than 9% on the news to trade at $2.13 as of 1:00pm EST on Friday.
At year-end 2010, total proved reserves were 17.3 million barrels of oil equivalent (MMBOE), up from 11.9 MMBOE a year earlier. The company also said that the net present value of its proved reserves, at a discount rate of 10% before tax, was estimated at $311 million, a 45% year-over-year increase.
Proved developed reserves increased 70% from 2.74 MMBOE to 4.65 MMBOE. Proved and probable reserves totaled 28.6 MMBOE, of which more than 98% was oil.
NiMin said its results are attributable to successful drilling activity in Wyoming, as well as from a positive production response from its oil recovery project in California.
Average daily production for the fourth quarter of 2010 was 1,035 BOE compared to 603 BOE in the year-ago period.
"Our new independent reserve report confirms that the Company's strategy to convert proved undeveloped and probable reserves to production is working," said chairman and CEO Clancy Cottman.
Looking ahead to 2011, the company said it is focused on moving its non-producing reserves into production. NiMin's board approved a 2011 capital budget of $25.0 million, the bulk of which will be used for infill drilling and facilities upgrades in Wyoming to allow for greater volumes of crude oil production.
NiMin has operations in the Bighorn Basin of Wyoming, the San Joaquin Basin in California and South Louisiana onshore areas of the US.