REG - Great Eastern Energy - Competent Persons Report

Great Eastern EnergyAnnouncement

08/07/2022 07:00

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RNS Number : 7477R  Great Eastern Energy Corp Ltd  08 July 2022

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ('MAR') which has been incorporated into UK law by the
European Union (Withdrawal) Act 2018.  Upon the publication of this
announcement via Regulatory Information Service ('RIS'), this inside
information is now considered to be in the public domain.

 

 

8 July 2022

 

Great Eastern Energy Corporation Limited

("Great Eastern" or "the Company")

 

Competent Persons Report ("CPR")

 

Great Eastern Energy Corporation Limited (LSE: GEEC), the fully integrated,
pioneering Indian Coal Bed Methane ("CBM") Company, is pleased to announce an
upgrade in its reserves and resources at its Raniganj (South) block.  The
CPR has been provided by the leading independent experts, DeGolyer and
McNaughton ("D&M").

 

D&M has made the following assessment of the CBM and Shale gas reserves
and resources in the Raniganj (South) block:

 

 Classification         Category       Shale Gas Resources  CBM Resources  Total Resources

 (TCF)
(TCF)
(TCF)
 Original gas in place  Low estimate   1.39                 2.62**         4.01

("OGIP")*
                        Best estimate  3.51                 6.13
                        High estimate  8.00                 10.62

 

 

 Classification          Resource Type  Category      Gross Recoverable Gas                 Total Future Pre-Tax Net Cash Flow

                                                                                            ($ Million)

                         (BCF)          Undiscounted  Discounted at 5% per annum ("PV 5%")  Discounted at 10% per annum ("PV 10%")

 Reserves*               CBM            1P            161.47                                $1,478.43                               $914.31       $594.93
                         2P                           357.20                                $3,260.31                               $1,979.19     $1,257.83
                         3P                           612.10                                $5,723.17                               $3,540.17     $2,295.99

 Contingent Resources*   CBM            1C            194.30                                $1,615.45                               $687.35       $319.39
                         2C                           517.49                                $4,662.32                               $2,090.35     $1,039.07
                         3C                           912.64                                $8,526.27                               $4,011.90     $2,096.20

 Prospective Resources*  SHALE GAS      1U            551.25                                $3,683.13                               $2,406.10     $1,768.36
                         2U                           1032.63                               $7,098.97                               $4,628.80     $3,227.12
                         3U                           2,103.45                              $15,113.90                              $9,614.07     $6,551.54

*As of 31 March 2022

**Marginally increased from 2619.50 BCF (2.62 TCF) to 2622 BCF (2.62 TCF)

TCF - Trillion Cubic Feet

BCF - Billion Cubic Feet

 

D&M's CPR updates the previous CPR on CBM and Shale gas volume estimates
produced by Advance Resources International, Inc. which was announced on 15
November 2018.

 

 

§ Best estimate aggregated OGIP of 6.13 TCF remains unchanged

 

§ High estimate aggregated OGIP of 10.62 TCF is 14.84% higher than the
previously reported 9.25 TCF

 

§ 3P+3C+3U volume of 3,628.19 BCF, i.e. 3.63 TCF is 21.41% higher than the
previously reported 2.99 TCF

 

§ Undiscounted value of 3P+3C+3U: $29.36 billion is 113.16% higher than the
previously reported $13.78 billion

 

§ PV 5% value of 3P+3C+3U: $17.17 billion

 

§ PV 10% value of 3P+3C+3U: $10.94 billion is 154.01% higher than the
previously reported $4.31 billion

 

 

1P and 2P reserves have reduced due to delays in field development activities
caused by the Covid-19 outbreak lockdowns, and the company was forced to
significantly reduce the gas production by choking the production wells due to
a decrease in gas offtake during that period.

These are the primary reasons for the recent shift in reserves, but there has
been a positive effect on both the total OGIP which has increased by 1.37 TCF
in the high estimate, and the potentially recoverable volumes (3P + 3C + 3U)
which have increased by 639.79 BCF.

The CBM OGIP remains the same at 2.62 TCF, and the Shale gas OGIP has
increased from 6.63 TCF to 8 TCF in the high estimate.

The 3P+3C volumes, related to CBM, have significantly increased from 1299.10
BCF to 1,524.74 BCF, an increase of 17.37%.  This has resulted in the
potential recovery rate increasing from 49.59% to 58.15% of the CBM OGIP of
2.62 TCF.

PV 10% value of 3P+3C: $4.39 billion is 187.94% higher than the previously
reported $1.53 billion.

The 3U volume, related to Shale gas, has also significantly increased from
1689.30 BCF to 2103.45 BCF, an increase of 24.52%.  The has resulted in the
potential recovery rate increasing from 25.48% of the previous Shale gas OGIP
of 6.63 TCF to 26.29% of the increased Shale gas OGIP of 8 TCF.

PV 10% value of 3U: $6.55 billion is 135.42% higher than the previously
reported $2.78 billion.

 

Prashant Modi, Managing Director & CEO of Great Eastern, said:

 

"We are delighted to announce this new CPR which reconfirms our OGIP for our
Raniganj (South) block, in the best estimate, of 6.13 TCF and an uplift in the
OGIP, in the high estimate, to 10.62 TCF along with a significant increase in
the value and recovery rate.  With an undiscounted value of over $29 billion
and a discounted value of between $11 billion to $17 billion, we are both
humbled and excited about the fantastic value accreditation and the
significant CBM and Shale gas value potential that remains to be unlocked at
Great Eastern.

We believe that the Shale gas resources can be explored and developed cost
effectively as we have been able to do with our CBM play.  With the GAIL
pipeline installation nearby progressing well and the demand for natural gas
growing, both in India and globally, it blends very well with the overall
vision, strategy, and the growth potential of the Company as it offers the
ability to deliver additional future production volumes to new customers and
markets.

Our QHSE and CSR policies along with our commitment to sustainable practices
all help us provide an alternative and cleaner source of energy to our
customers that improves the air quality of the region and contributes towards
the reduction of greenhouse gas emissions.  Together with our asset base, we
believe our sustainable policies and philanthropic activities allow the
integration of social and business goals that will help us secure an ongoing
competitive advantage in the longer term."

 

About the Company www.geecl.com (http://www.geecl.com)

 

A fully integrated gas production, development, and exploration Company in
India. Gas is being produced from the Raniganj (South) block in West Bengal,
which covers 210 sq. km with 10.62 TCF of Original gas in place.  The
Company's second license is the Mannargudi block in Tamil Nadu, which covers
667 sq. km with 0.98 TCF of Original gas in place.

 

About D&M    www.demac.com

 

D&M is one of the industry's leading experts in evaluations of
unconventional resources. D&M offers a diverse range of services
supporting the evaluation and development of unconventional resources.
D&M's involvement in unconventional resources started in the U.S. in 1982,
and since then D&M has gathered significant experience and working
knowledge in almost every unconventional basin across the world. D&M
annually evaluates reserves in more than 50,000 unconventional wells in North
America alone.  In addition to reserves and resource evaluations, recent
projects include rate-transient analysis, fracture modelling, reservoir
characterization, and modelling studies in various plays in North America,
Argentina, Kuwait, Bahrain, Algeria, China, and Australia.  In particular,
D&M was involved in the exploration, well completion design, and execution
of the world's first offshore unconventional horizontal well pilot in Bahrain.

 

 For further information please contact:

 Great Eastern Energy Corporation Limited      www.geecl.com (http://www.geecl.com)

 Yogendra Kr. Modi      Executive Chairman                                           +44 (0) 20 3470 0470
 Prashant Modi          Managing Director & CEO
 Jonathan Keeling       VP - Investor Relations                                      +44 (0) 7717 559 522

 SP Angel Corporate Finance LLP                                                      +44 (0) 20 3470 0470

 Rob Rees
 Richard Hail
 Caroline Rowe

 

 

 Explanatory Notes:

 Reserves are those quantities of petroleum which are anticipated to be
 commercially recovered from known accumulations from a given date forward.

 Contingent resources are those quantities of petroleum which are estimated,
 as of a given date, to be potentially recoverable from known accumulations.

 Prospective Resources are those quantities of petroleum estimated, as of a
 given date, to be potentially recoverable from undiscovered accumulations by
 application of future development projects.

 

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