OANDO PLC - Oando announces significant increase in reserves

Oando announces significant increase in reserves

Oando PLC
(Incorporated in Nigeria and registered as an external company in South Africa)
Registration number: RC 6474
(External company registration number: 2005/038824/10)
Share Code on the JSE Limited: OAO
Share Code on the Nigerian Stock Exchange: OANDO
ISIN: NGOANDO00002

OANDO ENERGY RESOURCES ANNOUNCES SIGNIFICANT INCREASE IN RESERVES

CALGARY, ALBERTA, April 8, 2015 – Oando Energy Resources Inc. (“OER” or the
“Company”) (TSX: OER), a company focused on oil and gas exploration and production in
Nigeria, today announced its 2014 year-end summary Reserves and Resources for its assets in
Nigeria. The annual independent reserves and resources evaluation was undertaken by
DeGolyer and MacNaughton (“D&M”), worldwide petroleum consulting group, and prepared in
accordance with National Instrument 51-101 "Standards of Disclosure for Oil and Gas Activities"
of the Canadian Securities Administrators (“NI 51-101”) and the Canadian Oil and Gas
Evaluation Handbook ("COGEH"). Reserves and other oil and gas information in this news
release is effective December 31, 2014 unless otherwise stated.

Highlights

The Company has significantly increased its reserves, both Proved (1P) and Proved and
Probable (2P) Reserves, as a result of technical revisions and the acquisition of the Nigerian
upstream oil and gas business of ConocoPhillips Company (“COP” or the “Acquisition
Assets”) versus the Form 51-101F1 and Form 51-101F2 filed for the year ended December 31,
2013;

   -   Proved net reserves (1P) increased by 78% to 288.5 MMboe, while Proved and
       Probable net reserves (2P) increased by 82% to 420.3 MMboe. The increase was
       largely due to recognizing the precedence of the license renewal under the Nigerian
       Petroleum Act, which is the basis of the extension of the reserves beyond the current
       license limit.

   -   Best Estimate (working interest) Contingent Resources (2C) correspondingly decreased
       by 78% from 547 MMboe to 122 MMboe as a result of the conversion of approximately
       190 MMboe of 2C Resources to 2P Reserves due to the rebased evaluation utilizing the
       economic life of the producing fields; also, net negative revisions of 246 MMboe
       occurred due to the current crude oil price environment which has deemed certain
       contingent developments uneconomic; and lastly, the change in the interpretation of
       reservoirs by the Independent Evaluator.

   -   Unrisked and Risked Mean Estimate Prospective Resources also decreased to
       957.1MMboe and 229.6MMboe, respectively.

   -   The economic value (NPV 10% of Future Net Revenue) of the Proved and Probable
       Reserves (2P) has increased by $545 Million (+44%) to $1,785 Million, largely due to the
       COP acquisition.

“We are very pleased with the new 2014 Reserves Numbers that confirms our thesis at the time
we embarked on our transformative COP acquisition,” said Pade Durotoye, CEO of Oando
Energy Resources. “This large Reserves base gives us significant scope and opportunity to
even further enhance production over the coming years and pursue in-field exploration
opportunities that will further increase our Resource Base.”

For further information, please refer to the Company’s statement of reserves data and other
information in Form 51-101F1, report on reserves and resources data by D&M, the company’s
independent qualified reserves evaluator in Form 51-101F2, report of management and
directors on oil and gas disclosure in Form 51-101F3, and the Company’s Annual Information
Form for the year ended December 31, 2014. All documents are available on the System for
Electronic Document Analysis and Retrieval (“SEDAR”) at www.sedar.com. Please refer to
these documents for additional information. All monetary figures reported herein are U.S. dollars
unless otherwise stated.


About Oando Energy Resources Inc. (OER)

OER currently has a broad suite of producing, development and exploration assets in the Gulf of
Guinea (predominantly in Nigeria). OER’s sales production was 52,734 boe/d for the month
ending February 28, 2015.

Cautionary Statements

More information about the Company’s oil and gas assets, including cautionary language
regarding the estimation of reserves and resources, can be found in the most recent Form 51-
101F1 filed under the Company’s profile on SEDAR at www.sedar.com. “Gross” or “gross”
means, when used in relation to production, reserves and resources, OER’s working interest
share of production, reserves and resources before deduction of royalties. “Net” or “net” means,
when used in relation to production, reserves and resources, either OER’s working interest
share of production, reserves and resources after deduction of royalties or OER’s entitlement to
production reserves and resources after deduction of royalties and PPT for production sharing
contracts. In relation to OER’s interest in wells, “Net” or “net” means the number of wells
obtained by aggregating OER’s working interest in each of its gross wells. In relation to OER’s
interest in property, “Net” or “net” means the total area in which OER has an interest multiplied
by the working interest owned by OER. “WI” means with respect to interests governed by a
JOA, PSC, farm-in agreement or farm-out agreement, the undivided interest of such party
(expressed as a percentage of the total interests of all parties in the contract) in the rights and
obligations derived from such contract, which may be an operating or non-operating interest.

Oil and Gas Equivalents

Production information is commonly reported in units of barrel of oil equivalent (“boe” or
“Mboe” or “MMboe”) or in units of natural gas equivalent (“Mcfe” or “MMcfe” or Bcfe”).
However, boe’s or Mcfe’s may be misleading, particularly if used in isolation. A boe conversion
ratio of 6 Mcf = 1 barrel, or a Mcfe conversion ratio of 1 barrel = 6 Mcf, is based on an energy
equivalency conversion method primarily applicable at the burner tip and does not represent a
value equivalency at the wellhead. Readers are cautioned that boe may be misleading,
particularly if used in isolation.

Definition of Reserves and Resources Categories

Proved reserves are those reserves that can be estimated with a high degree of certainty to
be recoverable. It is likely that the actual remaining quantities recovered will exceed the
estimated proved reserves. There is at least a 90 percent probability that the quantities
actually recovered will equal or exceed the estimated proved reserves.
Probable reserves are those additional reserves that are less certain to be recovered than
proved reserves. It is equally likely that the actual remaining quantities recovered will be
greater or less than the sum of the estimated proved plus probable reserves. Probable
reserves are those reserves that are less certain to be recovered than proved reserves. It is
equally likely that the actual remaining quantities recovered will be greater or less than the sum
of the estimated proved plus probable plus possible reserves. There is at least a 50 percent
probability that the quantities actually recovered will equal or exceed the sum of the estimated
proved plus probable reserves.

Possible reserves are those additional reserves that are less certain to be recovered than
probable reserves. It is unlikely that the actual remaining quantities recovered will exceed
the sum of the estimated proved plus probable plus possible reserves. Possible reserves are
those reserves that are less certain to be recovered than probable reserves. It is unlikely that
the actual remaining quantities recovered will be greater or less than the sum of the estimated
proved plus probable reserves. There is at least a 10 percent probability that the quantities
actually recovered will equal or exceed the sum of the estimated proved plus probable
reserves plus possible reserves.

Contingent resources are those quantities of petroleum estimated, as of a given date, to be
potentially recoverable from known accumulations using established technology or technology
under development, but which are not currently considered to be commercially recoverable due
to one or more contingencies. Contingencies may include factors such as economic, legal,
environmental, political and regulatory matters or lack of infrastructure or markets. It is also
appropriate to classify as Contingent resources the estimated discovered recoverable quantities
associated with a project in the early evaluation stage. Contingent resources are further
classified in accordance with the level of certainty associated with the estimates and may be
sub-classified based on project maturity and/or characterized by their economic status.

Best estimate (2C) is considered to be the best estimate of the quantity of resources that will
actually be recovered. It is equally likely that the actual remaining quantities recovered will be
greater or less than the best estimate. Those resources that fall within the best estimate have at
least a 50% confidence level that the actual quantities recovered will equal or exceed the
estimate.

Low estimate (1C) is considered to be a conservative estimate of the quantity of resources that
will actually be recovered. It is likely that the actual remaining quantities recovered will exceed
the low estimate. Those resources at the low end of the estimate range have the highest degree
of certainty – at least a 90% confidence level - that the actual quantities recovered will equal or
exceed the estimate.

High estimate (3C) is considered to be an optimistic estimate of the quantity of resources that
will actually be recovered. It is unlikely that the actual remaining quantities of resources
recovered will meet or exceed the high estimate. Those resources at the high end of the
estimate range have a lower degree of certainty – at least a 10% confidence level - that the
actual quantities recovered will equal or exceed the estimate.

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 sub-classified based on project maturity.
Best estimate is considered to be the best estimate of the quantity of resources that will
actually be recovered. It is equally likely that the actual remaining quantities recovered will be
greater or less than the best estimate. Those resources that fall within the best estimate have at
least a 50% confidence level that the actual quantities recovered will equal or exceed the
estimate.

Low estimate is considered to be a conservative estimate of the quantity of resources that will
actually be recovered. It is likely that the actual remaining quantities recovered will exceed the
low estimate. Those resources at the low end of the estimate range have the highest degree of
certainty (at least a 90% confidence level) that the actual quantities recovered will equal or
exceed the estimate.

High estimate is considered to be an optimistic estimate of the quantity of resources that will
actually be recovered. It is unlikely that the actual remaining quantities of resources recovered
will meet or exceed the high estimate. Those resources at the high end of the estimate range
have a lower degree of certainty (at least a 10% confidence level) that the actual quantities
recovered will equal or exceed the estimate.

Mean Estimate – In accordance with petroleum industry standards, the mean estimate is the
probability weighted average (expected value), which typically has a probability in the P45 to
P15 range, depending on the variance of prospective resources volume or associated quantity.
Therefore, the probability of a prospect or accumulation containing the probability-weighted
average volume or greater is usually between 45 and 15 percent. The mean estimate is the
preferred probabilistic estimate of resources volumes.


Future Net Revenue

All evaluations of future net revenue are after deduction of royalties, development cost,
production costs, abandonment costs and taxes (unless otherwise stated) but before
consideration of indirect cost such as administrative, overhead, and other miscellaneous
expenses. It should not be assumed that the estimates of future net revenue presented in the
following tables represent the fair market value of the Company's reserves. There is no
assurance that the forecast price and cost assumptions contained in the D&M Report will be
attained and variances could be material. Other assumptions relating to costs and other
matters are included in the D&M Report. The recovery and reserve estimates attributed to the
OER's properties described herein are estimates only. The actual reserves attributed to the
OER's properties may be greater or less than those calculated. The range in estimates of
reserves and future net revenue for individual properties may not reflect the same confidence
level as the range in estimates of reserves and future net revenue for all properties in
combination, due to effects of aggregation.

Forward Looking Statements

This news release contains forward-looking statements and forward-looking information within
the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”,
“continue”, “estimate”, “objective”, “ongoing”, “may”, “will”, “project”, “should”, “believe”, “plans”,
“intends” and similar expressions are intended to identify forward-looking information or
statements. In particular, this news release contains forward-looking statements relating to
intended acquisitions.

Although the Company believes that the expectations and assumptions on which such forward-
looking statements and information are reasonable, undue reliance should not be placed on the
forward-looking statements and information because the Company can give no assurance that
such statements and information will prove to be correct. Since forward-looking statements and
information address future events and conditions, by their very nature they involve inherent risks
and uncertainties.

Actual results could differ materially from those currently anticipated due to a number of factors
and risks. These include, but are not limited to: risks related to international operations, the
integration of assets acquired under the COP acquisition, the actual results of current
exploration and drilling activities, changes in project parameters as plans continue to be refined
and the future price of crude oil. Accordingly, readers should not place undue reliance on the
forward-looking statements. Readers are cautioned that the foregoing list of factors is not
exhaustive.

Additional information on these and other factors that could affect the Company’s financial
results are included in reports on file with applicable securities regulatory authorities and may be
accessed through the SEDAR website (www.sedar.com) under the Company. The forward-
looking statements and information contained in this news release are made as of the date
hereof and the Company undertakes no obligation to update publicly or revise any forward-
looking statements or information, whether as a result of new information, future events or
otherwise, unless so required by applicable securities laws.

Contact Information:

Pade Durotoye, CEO
Oando Energy Resources Inc.
pdurotoye@oandoenergyresources.com
+1 403-561-1713

Tokunboh Akindele
Head Investor Relations
Oando Energy Resources Inc.
takindele@oandoenergyresources.com
+1 403-560-7450

9 April 2015

Sponsor: Sasfin Capital (a division of Sasfin Bank Limited)

Date: 09/04/2015 04:24:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
 information disseminated through SENS.