Zephyr Energy plc has reported a major upgrade in recoverable reserves at its Paradox project in Utah, based on an updated Competent Person’s Report.
Proved Recoverable Reserves (1P) have surged 93-fold to 14.8 million net barrels of oil equivalent (boe), forecast to generate over US$115 million in undiscounted free cash flow, with an NPV-10 of around US$36 million.
Proved and Probable Reserves (2P) increased 25-fold to 35.3 million net barrels boe oil equivalent (boe), with an expected delivery of approximately US$400 million in undiscounted free cash flow and an NPV-10 of around US$101 million.
Total Recoverable Resources increased 3.5 times to 74.2 million net boe, projected to generate more than US$880 million in undiscounted free cash flow, with an NPV-10 of around US$158 million.
Net Prospective Resources (2U) also rose significantly, reaching 270 million net boe.
“We are delighted with the results of the CPR, which clearly demonstrate the excellent progress made at the Paradox project through our successful operations,” said chief executive Colin Harrington.
“The CPR further confirms the significant scale of the Paradox project and underpins our decision to begin a process to identify partners who can help accelerate drilling and unlock value from this asset.”
Harrington added, “The completion of the CPR marks an exciting milestone for Zephyr as we move towards full commercial production and seek to secure a strategic project partner.”
The independent report, prepared by Sproule, focused on the Cane Creek reservoir within a 20,000-acre area of the 46,000-acre Paradox project, where Zephyr holds detailed 3D seismic data.
Sproule estimated total recoverable resources in the Cane Creek reservoir at 74.2 million barrels of oil equivalent, valued at over US$880 million, along with a further 270 million barrels of prospective resources.
Zephyr has opened a data room to several potential partners who are currently reviewing project information, and the company expects the CPR findings to facilitate more advanced partnership discussions in the near term.
