i3 Energy PLC said its Canadian subsidiary had record reserves at the end of 2021, while the quarter just ended saw its highest production ever.
The last three months averaged an equivalent 20,300 barrels daily, comprising 61.1mln standard cubic feet of gas, 6,290 barrels of natural gas liquids, 3,522 bbl/d of oil and 316 boepd of royalty interest production.
Current production is also ahead of expectations, i3 added, which has upped its forecast for net income (revenue minus royalties, operating expenses, transportation and processing) in 2022 to US$192mln in 2022, a 28% rise over its previous guidance.
Canadian resource reserves at the end of 2021 rose 262% to 60.1mln proved plus probable (P50), total proved (1P) reserves increased 163% to 85.3mln boe and total proved plus probable (2P) reserves increased 185% to 154.1mln boe, compared to the prior year.
Based on these reserves, i3 estimates that the value of its future cash flows (NPV10%) is now US$354mln, US$444mln, and US$775mln (52p per share) respectively for its P50, 1P and 2P reserves.
The reserve categories equate to production for 9.5 years (P50), 11.8 years (1P) and 18.6 years (2P) at current rates.
i3 added that these forecasts were also based on a price for crude of US$69 per barrel compared to a current spot price of US$100.
Ryan Heath, president of i3 Energy Canada, noted: "The Canadian reserve report reflects the hard work and commitment of the entire i3 team.
"Strategic, accretive acquisitions along with efficient, low-cost field optimization have built predictable base production and a portfolio with extensive future development opportunities.
"i3 Canada is pleased to deliver record production exceeding 20,000 boepd, resulting from the company's low decline profile and strong drilling performance."
Majid Shafiq, i3’s chief executive, added: "Our organic reserves replacement ratio during the year was greater than 200% demonstrating the quality of our assets and operational capability to replace production from our existing asset base and with a 2P reserves life index of almost 19 years and multiple drilling opportunities, we have a portfolio ideally suited to deliver a consistent and progressive dividend and value growth."
GLJ carried out the reserves assessment in accordance with Canadian standard NI 51-101.