First Calgary lags in reserves’ report; finds oil, gas in Algeria

Gary Park

For those keeping tabs on the string of exploration successes by First Calgary Petroleums, there’s another one to add to the list.

The Calgary-based firm announced production testing at a 100 percent owned well in the Ledjmet block in Algeria has tested at 7,536 barrels of 51 degree API oil per day and 13.6 million cubic feet of gas.

In addition, production testing is anticipated in early January at an appraisal well that indicated the presence of 120 feet of net hydrocarbon pay.

First Calgary President Richard Anderson said his company has now production tested 10 wells on the block in excess of 200,000 barrels of oil equivalent per day.

But the company has stalled issuing its latest estimate of oil and gas reserves, without offering an explanation and without making Anderson available for interviews.

The numbers were originally expected this month and are now anticipated by mid-January.

A June 11 reserve update, compiled by independent Texas engineers DeGolyer and MacNaughton, put net proven reserves at 176 billion cubic feet, giving another lift to First Calgary shares that have more than doubled since April and now give the company a market value of C$3.3 billion.

Those numbers are considerably short of widely reported probable and possible gross reserves of 7.01 trillion cubic feet, but First Calgary is entitled to only a minority of total production in its deal with Algeria’s state-owned Sonatrach.

Meanwhile, the company, which has no production, has hired Lehman Brothers to conduct a strategic corporate review that could see First Calgary swallowed by a larger firm.