Investor Presentaiton
Armour Energy and controlled entities
armourenergy.com.au
Directors' report continued
for the year ended 30 June 2020
COMPETENT PERSONS STATEMENT CONTINUED
TECHNICAL STATEMENT - CONTINGENT OIL RESOURCES
Armour Energy engaged the services Mr Teof Rodriguez, Director of TR&A, to provide independent expert review of reports on the
operated Oil Resources associated within the Company's 100% WI petroleum licenses 14 and 22 and within the 90% WI petroleum
license 30, in the Kincora Project on 4 February 2020.
The basis for confirming the existence of a significant quantity of potentially moveable hydrocarbons in the Early Jurassic and
Middle Triassic aged reservoirs and the determination of a discovery is based upon stand-alone appraisal and appraisal pilot
production from existing historic wells in and around the New Royal, Washpool-Wilga, Borah Creek, Kincora, Waratah and Riverslea
Ⓒ Oil Fields. These oil pools have an aggregated cumulative oil production of 2.25 Mmbbl. Ongoing analysis of existing 2D and 3D
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data, well data and historic production will allow future new drill locations to be inventoried and new access negotiations have been
completed to allow for the Early Jurassic and Middle Triassic aged reservoirs to be included in the Armour Energy Greater Kincora
Field Development Plan, revised January 2020 and scheduled into the 2020-2025 drilling campaign.
At present the detailed petrophysical reservoir parameters, mapping of gross-rock-volume (GRV), historical production, rate-
transit-analysis, well tests, core data, 2D and 3D seismic, structure maps and net sand isopaches using probabilistic distributions
determined the net recoverable Contingent Oil Resources calculated for the report. Petroleum license commitments and new
wellbores have been budgeted. The new wells are part of a 5-year appraisal and development plan to increase oil sales production
in a staged approach to-up-to 350 barrels/day using new or existing oil facilities for separating and collection by ORI for sales.
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The estimated quantities of petroleum that may potentially be recovered by the application of future development project(s) relate
to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further
exploration appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable
hydrocarbons.
CONSENTS
The reserves information in this document is based on, and fairly represents, data and supporting documentation prepared by,
or under the supervision, of Mr Teof Rodrigues. Mr Rodrigues' primary discipline is Reservoir Engineering and during his 40-year
period in the Industry has had the opportunity to work in multidisciplined teams to appreciate the importance of understanding
the process involved in moving the hydrocarbons from the reservoir to the reference sales point. As the Chief Reservoir Engineer
for 6 years he had the Corporate Reserves Team reporting to him. In addition, he had the responsibility of endorsing all the Major
Projects and the key Reserves and Resource estimates of the Company. He is a Director of TR&A and an experienced petroleum
Reserves and resources estimator with 40 years relevant experience. He has adhered to the ASX Listing Rules Guidance Note 32.
His qualifications and experience meet the requirements to act as a Competent Person to report petroleum reserves under PRMS
(2018). The Resources information in this ASX announcement was issued with the prior written consent of Mr Rodrigues in the form
and context in which it appears.
The reserves review was carried out in accordance with the SPE Reserves Auditing Standards and the SPE-PRMS guidelines under
the supervision of Mr. Luke Titus, Chief Geologist, Armour Energy Limited. Mr. Titus' qualifications include a Bachelor of Science
from Fort Lewis College, Durango, Colorado, USA and he is an active member of AAPG and SPE. He has over 20 years of relevant
experience in both conventional and unconventional hydrocarbon exploration and production in the US and multiple international
basins. Mr. Titus meets the requirements of qualified petroleum reserve and resource evaluator as defined in Chapter 19 of the ASX
Listing Rules and consents to the inclusion of this information in this release.
SPE-PRMS
Society of Petroleum Engineer's Petroleum Resource Management System - Petroleum resources are the estimated quantities
of hydrocarbons naturally occurring on or within the Earth's crust. Resource assessments estimate total quantities in known and
yet-to-be discovered accumulations, resources evaluations are focused on those quantities that can potentially be recovered and
marketed by commercial projects. A petroleum resources management system provides a consistent approach to estimating
petroleum quantities, evaluating development projects, and presenting results within a comprehensive classification framework.
PRMS provides guidelines for the evaluation and reporting of petroleum reserves and resources (June 2018).
UNDER PRMS
"Reserves" are those quantities of petroleum which are anticipated to be commercially recovered from known accumulations from
a given date forward. All reserve estimates involve some degree of uncertainty. The uncertainty depends chiefly on the amount of
reliable geologic and engineering data available at the time of the estimate and the interpretation of these data. The relative degree
of uncertainty may be conveyed by placing reserves into one of two principal classifications, either proved or unproved. Unproved
reserves are less certain to be recovered than proved reserves and may be further sub-classified as probable and possible reserves
to denote progressively increasing uncertainty in their recoverability.
"Contingent Resources" are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known
accumulations, but the applied project(s) are not yet considered mature enough for commercial development due to one or more
contingencies. Contingent Resources may include, for example, projects for which there are currently no viable markets, or where
commercial recovery is dependent on technology under development, or where evaluation of the accumulation is insufficient to
clearly assess commerciality. Contingent Resources are further categorised in accordance with the level of certainty associated
with the estimates and may be sub-classified based on project maturity and/or characterised by their economic status.
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