Cloudbreak Reports 214,000 bbl of NI 51-101 Recoverable Oil Reserves
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 10/14/10 -- Cloudbreak Resources Ltd. (TSX VENTURE: CDB)(PINK SHEETS: CUDBD)(FRANKFURT: C6K) is pleased to announce an independent NI 51-101 compliant upgrade of its J5 parcel from the category of prospective resources to probable and possible reserves. Based on favourable reservoir parameters, Chapman Petroleum Engineering Ltd. of Calgary, Alberta, has estimated a total of 214,000 bbl probable plus possible reserves of 30 degree API oil in the Viking sandstone. This includes 71,000 bbl in the probable category, and 143,000 bbl in the possible category that could be developed by three short vertical and/or horizontal wells. Seismic interpretation that is currently underway has the potential to further upgrade or increase these reserves. These reserves were identified as a result of detailed geological studies focused on identifying specific drill targets on Cloudbreak's 100% owned oil and gas leases, as part of its ongoing exploration and development program.
The Viking reservoir is locally thick under all of Parcel J5, and occurs at a shallow depth. A suspended Viking oil well in the middle of the property was drilled in 1965 and flowed 35.22 bpd on a limited production test, but was never developed. This is an unusually strong flow rate for a vertical well in the Viking, and the undeveloped reservoir remains intact and undepleted.
We are also very encouraged by the presence of potential pay zones in the underlying Bakken sand. The Bakken is thick and is a prolific producer in the immediate area. It is located only 140 m below the Viking, and can be tested for a minimal extra cost. An independent NI 51-101 study by Chapman Petroleum Engineering Ltd. has already assigned a prospective resource to the Bakken zone on this property that is documented in Cloudbreak's News Release of July 15, 2010, and a successful Bakken test would upgrade this prospective resource to reserve status. Cloudbreak looks forward to testing both the Viking and the Bakken as part of its planned program.
Once Chapman's current studies are complete, Cloudbreak is planning a program to test the Viking and Bakken targets on Parcel J5, upgrade the reserve estimate, and build a solid production base and cash flow for the company. Concurrent studies by Chapman are underway to generate specific drill targets across all of Cloudbreak's oil assets, in preparation for executing a program to exploit the full potential of these assets and maximize shareholder value with the new oil division. Management will release this information as it becomes available.
Reserves are estimated remaining quantities of oil and natural gas and related substances anticipated to be recoverable from known accumulations, as of a given date, based on the analysis of drilling, geological, geophysical, and engineering data; the use of established technology; and specified economic conditions, which are generally accepted as being reasonable. Reserves are further classified according to the level of certainty associated with the estimates and may be subclassified based on development and production status.
Proven reserves are those reserves that can be estimated with a high degree of certainty to be recoverable.
Probable reserves are those additional reserves that are less certain to be recovered than proven reserves.
Possible reserves are those additional reserves that are less certain to be recovered than proven reserves. There is a 10% probability that the quantities actually recovered will equal or exceed the sum of proven plus probable plus possible reserves.
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. Prospective resources have both an associated chance of discovery and a chance of development. Prospective resources are further subdivided in accordance with the level of certainty associated with recoverable estimates assuming their discovery and development and may be subclassified based on project maturity.
There is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources.
ON BEHALF OF THE BOARD
Peter Bryant, President & Director
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Cloudbreak Resources Ltd.
Peter Bryant
President & Director
(604) 669-0401 or Toll Free: 1-800-669-0401
(604) 669-0414 (FAX)
www.cloudbreakresources.com