FORM 51-101F1 STATEMENT OF RESERVES DATA AND OTHER OIL AND GAS INFORMATION TABLE OF CONTENTS GENERAL INSTRUCTIONS PART 1 DATE OF STATEMENT Item 1.1 Relevant Dates PART 2 DISCLOSURE OF RESERVES DATA Item 2.1 Reserves Data (Constant Prices and Costs) Item 2.2 Reserves Data (Forecast Prices and Costs) Item 2.3 Reserves Determination Varies with Accounting Item 2.4 Future Net Revenue Disclosure Varies with Accounting PART 3 PRICING ASSUMPTIONS Item 3.1 Constant Prices Used in Estimates Item 3.2 Forecast Prices Used in Estimates PART 4 RECONCILIATIONS OF CHANGES IN RESERVES AND FUTURE NET REVENUE Item 4.1 Reserves Reconciliation Item 4.2 Future Net Revenue Reconciliation PART 5 ADDITIONAL INFORMATION RELATING TO RESERVES DATA Item 5.1 Undeveloped Reserves Item 5.2 Significant Factors or Uncertainties Item 5.3 Future Development Costs Item 5.4 Abandonment and Reclamation Costs PART 6 OTHER OIL AND GAS INFORMATION Item 6.1 Oil and Gas Properties and Wells Item 6.2 Properties with no Attributed Reserves Item 6.3 Forward Contracts Item 6.4 Additional Information Concerning Abandonment and Reclamation Costs Item 6.5 Tax Horizon Item 6.6 Costs Item 6.7 Exploration and Development Activities Item 6.8 Production Estimates Item 6.9 Production History Proposed Form Published for Comment (Comments requested by March 31, 2003)
FORM 51-101F1 STATEMENT OF RESERVES DATA AND OTHER OIL AND GAS INFORMATION This is the form referred to in item 1 of section 2.1 of National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities ("NI 51-101"). GENERAL INSTRUCTIONS (1) Terms for which a meaning is given in NI 51-101 have the same meaning in this Form 51-101F1 1 . (2) Unless otherwise specified in this Form 51-101F1, information under item 1 of section 2.1 of NI 51-101 shall be provided as at the last day of the reporting issuer's most recent financial year or for its financial year then ended. (3) It is not necessary to include the headings or numbering, or to follow the ordering of Items, in this Form 51-101F1. Information may be provided in tables. (4) To the extent that any Item or any component of an Item specified in this Form 51-101F1 does not apply to a reporting issuer and its activities and operations, or is not material, no reference need be made to that Item or component. It is not necessary to state that such an Item or component is "not applicable" or "not material". Materiality is discussed in NI 51-101 and Companion Policy 51-101CP. (5) This Form 51-101F1 sets out minimum requirements. A reporting issuer may provide additional information not required in this Form 51-101F1 provided that it is not misleading and not inconsistent with the requirements of NI 51-101, and provided that material information required to be disclosed is not omitted. (6) A reporting issuer may satisfy the requirement of this Form 51-101F1 for disclosure of information "by country" by instead providing information by foreign geographic area in respect of countries outside North America as may be appropriate for meaningful disclosure in the circumstances. 1 For the convenience of readers, Appendix 1 to Companion Policy 51-101CP sets out the meanings of terms that are printed in italics (or, in the Instructions, in bold type) in this Form 51-101F1 or in NI 51-101, Form 51-101F2, Form 51-101F3 or the Companion Policy. Proposed Form Published for Comment (Comments requested by March 31, 2003)
- 2 -PART 1 DATE OF STATEMENT Item 1.1 Relevant Dates 1. Date the statement. 2. Disclose the effective date of the information being provided. 3. Disclose the preparation date of the information being provided. INSTRUCTIONS (1) For the purpose of Part 2 of NI 51-101, and consistent with the definition of reserves data and General Instruction 2 of this Form 51-101F1, the effective date to be disclosed under section 2 of Item 1.1 is the last day of the reporting issuer’s most recent financial year. It is the date of the balance sheet for the reporting issuer's most recent financial year (for example, "as at December 31, 20xx") and the ending date of the reporting issuer’s most recent annual statement of income (for example, "for the year ended December 31, 20xx"). (2) The same effective date applies to reserves of each category reported and to related future net revenue. References to a change in an item of information, such as changes in production or a change in reserves, mean changes in respect of that item during the year ended on the effective date, or such earlier period as may be specified. (3) The preparation date, in respect of written disclosure, means the most recent date on which information relating to the period ending on the effective date was considered in the preparation of the disclosure. The preparation date is a date subsequent to the effective date because it takes time after the end of the financial year to assemble the information for that completed year that is needed to prepare the required disclosure as at the end of the financial year. (4) Because of the interrelationship between certain of the reporting issuer's reserves data and other information referred to in this Form 51-101F1 and certain of the information included in its financial statements, the reporting issuer should ensure that its financial auditor and its qualified reserves evaluators or auditors are kept apprised of relevant events and transactions, and should facilitate communication between them. (5) If the reporting issuer provides information as at a date more recent than the effective date, in addition to the information required as at the effective date, also disclose the date as at which that additional information is provided. The provision of such additional information does not relieve the reporting issuer of the obligation to provide information as at the effective date. Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 3 -PART 2 DISCLOSURE OF RESERVES DATA Item 2.1 Reserves Data (Constant Prices and Costs) 1. Breakdown of Proved Reserves (Constant Case) – Disclose reserves, gross and net, estimated using constant prices and costs, by country and in the aggregate, for each product type, in the following classifications: (a) proved developed producing reserves; (b) proved developed non-producing reserves; (c) proved undeveloped reserves; and (d) proved reserves (in total). 2. Net Present Value of Future Net Revenue (Constant Case) – Disclose the net present value of future net revenue attributable to the categories of reserves referred to in section 1 of this Item, estimated using constant prices and costs, before and after income taxes, calculated without discount and using a discount rate of 10 percent. 3. Breakdown of Future Net Revenue (Constant Case) (a) Disclose, by year for at least ten years and grouped thereafter, by country and in the aggregate, estimated using constant prices and costs and calculated without discount, the following information in respect of future net revenue attributable to proved reserves (in total): (i) estimated future revenue; (ii) royalties; (iii) operating costs; (iv) development costs; (v) abandonment and reclamation costs; (vi) future net revenue before income taxes; (vii) future income tax expenses; and (viii) future net revenue after income taxes. (b) In respect of future net revenue attributable to proved reserves (in total), disclose, by country, the net present value of the aggregate of each of the following, estimated using constant prices and costs and calculated using a discount rate of 10 percent: Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 4 - (i) development costs; (ii) abandonment and reclamation costs; (iii) future net revenue before income taxes; and (iv) future net revenue after income taxes. Item 2.2 Reserves Data (Forecast Prices and Costs) 1. Breakdown of Reserves (Forecast Case) – Disclose reserves, gross and net, estimated using forecast prices and costs, by country and in the aggregate, for each product type, in the following classifications: (a) proved developed producing reserves; (b) proved developed non-producing reserves; (c) proved undeveloped reserves; (d) proved reserves (in total); (e) probable reserves (in total); (f) proved plus probable reserves (in total); and (g) if the reporting issuer discloses an estimate of possible reserves in the statement: (i) possible reserves (in total); and (ii) proved plus probable plus possible reserves (in total). 2. Net Present Value of Future Net Revenue (Forecast Case) – Disclose the net present value of future net revenue attributable to the categories of reserves referred to in section 1 of this Item, estimated using forecast prices and costs, before and after income taxes, calculated without discount and using discount rates of 5 percent, 10 percent, 15 percent and 20 percent. 3. Breakdown of Future Net Revenue (Forecast Case) (a) This section 3 applies to future net revenue attributable to each of the following classifications of reserves estimated using forecast prices and costs: (i) proved reserves (in total); (ii) proved plus probable reserves (in total); and (iii) if paragraph 1(g) of this Item applies, proved plus probable plus possible reserves (in total). Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 5 - (b) Disclose by year for at least ten years and grouped thereafter, by country and in the aggregate, estimated using forecast prices and costs, calculated without discount, the following information: (i) estimated future revenue; (ii) royalties; (iii) operating costs; (iv) development costs; (v) abandonment and reclamation costs; (vi) future net revenue before income taxes; (vii) future income tax expenses; and (viii) future net revenue after income taxes. (c) Disclose, by country, the net present value of the aggregate of each of the following, estimated using forecast prices and costs, calculated without discount and using discount rates of 5 percent, 10 percent, 15 percent and 20 percent: (i) development costs; (ii) abandonment and reclamation costs; (iii) future net revenue before income taxes; and (iv) future net revenue after income taxes. Item 2.3 Reserves Determination Varies with Accounting In determining reserves to be disclosed: (a) Consolidated Financial Disclosure – if the reporting issuer files consolidated financial statements: (i) include 100 percent of reserves attributable to the parent company and 100 percent of the reserves attributable to its consolidated subsidiaries (whether or not wholly-owned); and (ii) if a significant portion of reserves referred to in clause (i) is attributable to a consolidated subsidiary in which there is a significant minority interest, disclose that fact and the approximate portion of such reserves attributable to the minority interest; Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 6 - (b) Proportionate Consolidation – if the reporting issuer files financial statements in which investments are proportionately consolidated, the reporting issuer's disclosed reserves must include the reporting issuer's proportionate share of the investees’ oil and gas reserves; and (c) Equity Accounting – if the reporting issuer files financial statements in which investments are accounted for by the equity method, do not include investees' oil and gas reserves in disclosed reserves of the reporting issuer, but disclose the reporting issuer's share of the investees' oil and gas reserves separately. Item 2.4 Future Net Revenue Disclosure Varies with Accounting 1. Consolidated Financial Disclosure – If the reporting issuer files consolidated financial statements, and if a significant portion of the reporting issuer's economic interest in future net revenue is attributable to a consolidated subsidiary in which there is a significant minority interest, disclose that fact and the approximate portion of the economic interest in future net revenue attributable to the minority interest. 2. Equity Accounting – If the reporting issuer files financial statements in which investments are accounted for by the equity method, do not include investees' future net revenue in disclosed future net revenue of the reporting issuer, but disclose the reporting issuer's share of such future net revenue of investees separately, by country and in the aggregate. INSTRUCTIONS (1) Do not include, in reserves, oil or gas that is subject to purchase under a long-term supply, purchase or similar agreement. However, if the reporting issuer is a party to such an agreement with a government or governmental authority, and participates in the operation of the properties in which the oil or gas is situated or otherwise serves as "producer" of the reserves (in contrast to being an independent purchaser, broker, dealer or importer), disclose separately the reporting issuer's interest in the reserves that are subject to such agreements at the effective date and the net quantity of oil or gas received by the reporting issuer under the agreement during the year ended on the effective date. (2) Future net revenue includes the portion attributable to the reporting issuer's interest under an agreement referred to in Instruction (1). PART 3 PRICING ASSUMPTIONS Item 3.1 Constant Prices Used in Estimates For each product type, disclose the benchmark reference prices for the countries or regions in which the reporting issuer operates, as at the last day of the reporting issuer's most recent financial year, reflected in the reserves data disclosed in response to Item 2.1. Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 7 -Item 3.2 Forecast Prices Used in Estimates 1. For each product type, disclose: (a) the pricing assumptions used in estimating reserves data disclosed in response to Item 2.2: (i) for each of at least the following ten financial years; and (ii) generally, for subsequent periods; and (b) the reporting issuer’s weighted average historical prices for the most recent financial year. 2. The disclosure in response to section 1 shall include the benchmark reference pricing schedules for the countries or regions in which the reporting issuer operates, and inflation and other forecast factors used. 3. If the pricing assumptions specified in response to section 1 were provided by a qualified reserves evaluator or auditor independent of the reporting issuer, disclose that fact and identify the qualified reserves evaluator or auditor. INSTRUCTIONS (1) Benchmark reference prices may be obtained from sources such as public product trading exchanges or prices posted by purchasers. (2) The defined terms "constant prices and costs" and "forecast prices and costs" include any fixed or presently determinable future prices or costs to which the reporting issuer is legally bound by contract, including those for an extension period of a contract that is likely to be extended. In effect, such contractually committed prices override benchmark reference prices for the purpose of estimating reserves data. To ensure that disclosure under this Part is not misleading, the disclosure should reflect such contractually committed prices. (3) Under subsection 5.7(1) of NI 51-101, the reporting issuer must obtain the written consent of the qualified reserves evaluator or auditor to disclose his or her identity in response to section 3 of this Item. PART 4 RECONCILIATIONS OF CHANGES IN RESERVES AND FUTURE NET REVENUE Item 4.1 Reserves Reconciliation 1. Provide the information specified in section 2 of this Item in respect of the following classifications of reserves: Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 8 - (a) net proved reserves (in total); (b) net probable reserves (in total); and (c) net proved plus probable reserves (in total). 2. Disclose changes between the reserves estimates referred to in section 1 made as at the effective date and the corresponding estimates ("prior-year estimates") made as at the last day of the preceding financial year of the reporting issuer: (a) by country and in the aggregate; (b) for each of the following product types: (i) light and medium crude oil (combined); (ii) heavy oil; (iii) natural gas; and (iv) synthetic oil and other products from non-conventional oil and gas activities; (c) separately identifying and explaining: (i) economic factors (revisions of the prior-year estimates resulting from changes in previously estimated prices and costs); (ii) technical revisions (revisions of the prior-year estimates resulting from information, other than estimated prices and costs, that was not available when the prior-year estimates were made); (iii) acquisitions of reserves; (iv) dispositions of reserves; (v) extensions and improved recovery; (vi) discoveries; and (vii) production. Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 9 -INSTRUCTION The reconciliation required under this Item 4.1 may be provided in respect of reserves estimated using either constant prices and costs or forecast prices and costs, with the price and cost case indicated in the disclosure. Item 4.2 Future Net Revenue Reconciliation 1. Provide the information specified in section 2 of this Item in respect of estimates of future net revenue (estimated using constant prices and costs and calculated using a discount rate of 10 percent) attributable to net proved reserves (in total). 2. Disclose changes between the future net revenue estimates referred to in section 1 made as at the effective date and the corresponding estimates ("prior-year estimates") made as at the last day of the preceding financial year of the reporting issuer: (a) by country and in the aggregate; (b) separately identifying and explaining: (i) sales and transfers of oil, gas or other product types produced during the period net of production costs and royalties; (ii) net change in sales and transfer prices and in production costs and royalties related to future production; (iii) changes in previously estimated development costs incurred during the period; (iv) changes in estimated future development costs; (v) net change resulting from extensions and improved recovery; (vi) net change resulting from discoveries; (vii) changes resulting from acquisitions of reserves; (viii) changes resulting from dispositions of reserves; (ix) net change resulting from revisions in quantity estimates; (x) accretion of discount (10 percent of discounted future net revenue at the beginning of the financial year); (xi) net change in income taxes; and (xii) any other significant factors. Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 10 -INSTRUCTIONS (1) Compute the effects of changes in prices and costs before the effects of changes in volumes, so that, in respect of constant prices and costs, volumes are reflected at prices as at the effective date. (2) In providing information for each product type under this Part, it is not necessary to allocate among multiple product types attributable to a single well, reservoir or other reserves entity. It is sufficient to provide the information in respect of the principal product type attributable to the well, reservoir or other reserves entity. (3) Except in respect of clause 2(b)(xi) of Item 4.2, the information to be provided under this Part is pre-tax information. (4) For the purposes of clause 2(b)(xi) of Item 4.2, a "net change in income taxes" includes both income taxes incurred during the period and changes in estimated future income tax expenses. PART 5 ADDITIONAL INFORMATION RELATING TO RESERVES DATA Item 5.1 Undeveloped Reserves 1. For proved undeveloped reserves: (a) disclose for each product type the volumes of proved undeveloped reserves that were first attributed in each of the most recent five financial years and, in the aggregate, before that time; or (b) discuss generally the basis on which the reporting issuer attributes proved undeveloped reserves, its plans (including timing) for developing the proved undeveloped reserves and, if applicable, its reasons for not planning to develop particular proved undeveloped reserves during the following two years. 2. For probable undeveloped reserves: (a) disclose for each product type the volumes of probable undeveloped reserves that were first attributed in each of the most recent five financial years and, in the aggregate, before that time; or (b) discuss generally the basis on which the reporting issuer attributes probable undeveloped reserves, its plans (including timing) for developing the probable undeveloped reserves and, if applicable, its reasons for not planning to develop particular probable undeveloped reserves during the following two years. Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 11 -Item 5.2 Significant Factors or Uncertainties 1. Identify and discuss important economic factors or significant uncertainties that affect particular components of the reserves data. 2. Section 1 does not apply if the information is disclosed in the reporting issuer's financial statements for the financial year ended on the effective date. INSTRUCTION Examples of information that could warrant disclosure under this Item 5.2 include unusually high expected development costs or operating costs, the need to build a major pipeline or other major facility before production of reserves can begin, or contractual obligations to produce and sell a significant portion of production at prices substantially below those which could be realized but for those contractual obligations. Item 5.3 Future Development Costs 1. Discuss the reporting issuer's expectations as to: (a) the sources (including internally-generated cash flow, debt or equity financing, farm-outs or similar arrangements) and costs of funding for estimated future development costs; and (b) the effect of those costs of funding on disclosed reserves or future net revenue. 2. If the reporting issuer expects that the funding costs referred to in section 1 could make development of a property uneconomic for that reporting issuer, disclose that expectation and its plans for the property. PART 6 OTHER OIL AND GAS INFORMATION Item 6.1 Oil and Gas Properties and Wells 1. Identify and describe generally the reporting issuer’s important properties, plants, facilities and installations: (a) identifying their location (province, territory or state if in Canada or the United States, and country otherwise); (b) indicating whether they are located onshore or offshore; (c) in respect of properties to which reserves have been attributed and which are capable of producing but which are not producing, disclosing how long they have been in that condition and discussing the general proximity of pipelines or other means of transportation; and (d) describing any statutory or other mandatory relinquishments, surrenders, back-ins or changes in ownership. Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 12 -2. State, separately for oil wells and gas wells, the number of the reporting issuer's producing wells and non-producing wells, expressed in terms of both gross wells and net wells, by location (province, territory or state if in Canada or the United States, and country otherwise). Item 6.2 Properties with No Attributed Reserves 1. For properties to which no reserves are attributed, disclose: (a) the gross area (acres or hectares) in which the reporting issuer has an interest; (b) the interest of the reporting issuer therein expressed in terms of net area (acres or hectares); (c) the location, by country; and (d) the existence, nature (including any bonding requirements), timing and cost (specified or estimated) of any work commitments. 2. Disclose, by country, the net area (acres or hectares) of property to which no reserves are attributed and for which the reporting issuer expects its rights to explore, develop and exploit to expire within one year. Item 6.3 Forward Contracts 1. If the reporting issuer is bound by an agreement (including a transportation agreement), directly or through an aggregator, under which it may be precluded from fully realizing, or may be protected from the full effect of, future market prices for oil or gas, describe the agreement, providing dates, time periods and summaries or ranges of volumes and contracted or reasonably estimated values. 2. Section 1 does not apply to agreements disclosed by the reporting issuer (a) as financial instruments, in accordance with Section 3860 of the CICA Handbook; or (b) as contractual obligations or commitments, in accordance with Section 3280 of the CICA Handbook. 3. If the reporting issuer's transportation obligations or commitments for future physical deliveries of oil or gas exceed the reporting issuer’s expected related future production from its proved reserves, estimated using forecast prices and costs and disclosed under Part 2, disclose the amount of such excess, providing dates, time periods, volumes and reasonably estimated value. Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 13 -Item 6.4 Additional Information Concerning Abandonment and Reclamation Costs In respect of abandonment and reclamation costs for surface leases, wells, facilities and pipelines, disclose: (a) how the reporting issuer estimates such costs; (b) the number of net wells for which the reporting issuer expects to incur such costs; (c) the total amount of such costs, net of estimated salvage value, expected to be incurred, calculated without discount and using a discount rate of 10 percent; (d) the portion, if any, of the amounts disclosed under paragraph (c) of this Item 6.4 that was not deducted in estimating the reserves data disclosed under Part 2; and (e) the portion, if any, of the amounts disclosed under paragraph (c) of this Item 6.4 that the reporting issuer expects to pay in the next three financial years, in total. INSTRUCTION Item 6.4 supplements the information disclosed in response to clauses 3(e) of Item 2.1 and (3)(b)(v) of Item 2.2. The response to paragraph (d) of Item 6.4 should enable a reader of this statement and of the reporting issuer's financial statements for the financial year ending on the effective date to understand both the reporting issuer's estimated total abandonment and reclamation costs, and what portions of that total are, and are not, reflected in the disclosed reserves data. Item 6.5 Tax Horizon If the reporting issuer is not required to pay income taxes for its most recently completed financial year, discuss its estimate of when income taxes may become payable. Item 6.6 Costs 1. Disclose each of the following by country for the most recent financial year (irrespective of whether such costs were capitalized or charged to expense when incurred): (a) property acquisition costs, separately for proved properties and unproved properties; (b) exploration costs; and (c) development costs. 2. If the reporting issuer files financial statements in which investments are accounted for by the equity method, disclose separately, for the purpose of this Item 6.6, the reporting issuer's share of the investees' property acquisition costs, exploration costs and development costs incurred in the most recent financial year, in the aggregate by country. Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 14 -Item 6.7 Exploration and Development Activities 1. Disclose, by country and separately for exploratory wells and development wells: (a) the number of gross wells and net wells completed in the reporting issuer's most recent financial year; and (b) for each category of wells for which information is disclosed under paragraph (a), the number completed as oil wells, gas wells and service wells and the number that were dry holes. 2. Describe generally the reporting issuer’s most important current and likely exploration and development activities, by country. Item 6.8 Production Estimates 1. Disclose, by country, for each product type, the volume of production estimated for the first year reflected in the estimates of future net revenue disclosed under Items 2.1 and 2.2. 2. If one field accounts for 20 percent or more of the estimated production disclosed under section 1, identify that field and disclose the volume of production estimated for the field for that year. Item 6.9 Production History 1. To the extent not previously disclosed in financial statements filed by the reporting issuer, disclose, for each quarter of its most recent financial year, by country for each product type: (a) the reporting issuer's share of average daily production volume, before deduction of royalties; and (b) as an average per unit of volume (for example, $/bbl or $/Mcf): (i) the prices received; (ii) royalties paid; (iii) production costs; and (iv) the resulting netback. 2. For each important field, and in total, disclose the reporting issuer’s production volumes for the most recent financial year, for each product type. Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
- 15 -INSTRUCTION In providing information for each product type for the purpose of Item 6.9, it is not necessary to allocate among multiple product types attributable to a single well, reservoir or other reserves entity. It is sufficient to provide the information in respect of the principal product type attributable to the well, reservoir or other reserves entity. _________________ Proposed Form Published for Comment (Comments to be submitted by March 31, 2003)
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