Oil Patch Insider

First Calgary piles up Algerian reserves

First Calgary Petroleums could be sitting on 8.41 trillion cubic feet of natural gas and 860 million barrels of liquids in the Algerian desert — a mother lode that gives even more impetus to talk that the Calgary-based junior is headed for a takeover.

Even at a much more conservative level, First Calgary is now credited with net proved plus probable reserves of 406 billion cubic feet of gas and 61 million barrels of liquids in an eagerly awaited independent report made public Jan. 17 by Texas-based engineering firm DeGolyer & MacNaughton.

The high end, less restrictive calculation covered gross proved, probable and possible recoverable reserves and was almost double that of a year earlier, said Richard Anderson, First Calgary president and chief executive officer.

He said the rapid climb stemmed from a 100 percent success rate from seven wells, six exploration and one appraisal.

He said the reserve base positions First Calgary for “continued growth and development.”

It also heightens interest in an on-going review of strategic options that includes Lehman Brothers as adviser.

A Lehman spokesman said there has been a “very good level” of interest, with sources in Europe fingering Norway’s Statoil, Royal Dutch/Shell, France’s Total and Anadarko as possible contenders.

In the meantime, First Calgary’s market capitalization has soared over the past five years from C$39 million to C$3.8 billion.

—Gary Park