Prospectus re Admission to the Official List - Heritage Oil

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RPS EnergyHeritage Oil – Competent Persons Report2.3.2. Prospective Resources (Exploration Prospects)Unlike risk assessment for Contingent Resources, when dealing with undrilled prospects there is a moreaccepted industry approach to risk assessment for Prospective Resources. It is standard practice to assign aGeological Probability of Success (GPoS) which represents the likelihood of source rock, charge, reservoir,trap and seal conspiring to result in a present-day hydrocarbon accumulation. RPS assesses risk byconsidering both a Play Risk and a Prospect Risk. The chance of success for the Play and Prospect aremultiplied together to give a Geological Probability of Success (GPoS). We consider three factors whenassessing Play Risk: source, reservoir, seal and we consider four factors when assessing Prospect Risk: trap,seal, reservoir and charge. The result is the chance or probability of discovering hydrocarbon volumeswithin the range defined (Section 2.4). It is not an estimation of commercial chance of success.2.4. Uncertainty EstimationThe estimation of expected hydrocarbon volumes is an integral part of the evaluation process. It is normalpractice to assign a range to the volume estimates because of the uncertainty over exactly how large thediscovery or prospect will be. Estimating the range is normally undertaken in a probabilistic way (i.e. usingMonte Carlo simulation), using a range for each input parameter to derive a range for the output volumes.Key contributing factors to the overall uncertainty are data uncertainty, interpretation uncertainty andmodel uncertainty.Volumetric input parameters, Gross Rock Volume (GRV), porosity, N:G ratio, S w , fluid expansion factor(Eo or Eg) and recovery factor, are considered separately. RPS has internal guidelines on the best practicein characterising appropriate input distributions for these parameters.Systematic bias in volumetric assessment is a well-established phenomenon. There is a tendency toestimate parameters to a greater degree of precision than is warranted (2) and to bias pre-drill estimates tothe high side (3) . Rose and Edwards (3) observe the tendency towards assessing volumes in too narrow arange, with overly large low-side and mean estimates. RPS uses benchmarked p10/p90 ratios and knownfield-size distributions to check the reasonableness of estimated volumes.3. OMAN BLOCK 83.1. OverviewHeritage via Eagle Energy (Oman) Ltd holds a 10 per cent. equity in one licence (Block 8) situatedoffshore Oman. This licence was acquired in 1996 and contains the currently producing Bukha Field andthe undeveloped West Bukha/Henjam discovery.This block is in a region of complex structures with a multiphase compressional origin. Deformation beganin the mid to late Cretaceous with thrust emplacement of the Semail ophiolite, followed by salt diapirism,and finally compression and wrenching related to the mid Miocene Zagross orogeny. The two fields occurin structures which all have the form of anticlines related to backthrusts that probably originated inadvance of the Semail ophiolite overthrust, but were modified by continued thrusting and wrench faultmovement in the mid Miocene.The reservoirs are shelf limestones of early to mid Cretaceous age. The Aptian age Thamama Grouplimestones are sealed by Albian Nahr Umr Formation shales. These units are followed by a further seriesof shelf limestones of late Albian to Cenomanian age: termed the Mauddud, Khatiyah and Mishrif(=Sarvak in Iran) Formations. Deposition of these units was then followed by the major 92Ma (Turonian)unconformity, which is related to the emplacement of the Semail Ophiolite. The extent and depth of thisunconformity increases towards the main thrust front in onshore Oman (hence the younger reservoirs aremissing in the Bukha areas towards the west). This erosive phase was followed, firstly by the transgressiveLaffan shale, and then by the shallow water carbonate Ilam Formation. Both formations are ofConiacian-Santonian age.Late Cretaceous sedimentation was in a foredeep west of the thrust front, in which the Aruma Groupflysch was deposited. Phases of structural growth continued in the Palaeocene, Oligocene and LateMiocene. The Miocene unconformity is particularly strongly developed, and is locally highly angularshowing that most structural growth was just pre late Miocene.(2) Rose, P.R., 1987. Dealing with Risk and Uncertainty in Exploration: How Can We Improve? AAPG Bulletin, 71 (1), pp. 1-16.(3) Rose, R.P. and Edwards, B., 2001. Could this prospect turn out to be a mediocre little one-well field? Abstract, AAPGBulletin, 84(13)78
RPS EnergyHeritage Oil – Competent Persons Report3.2. Bukha FieldThe Bukha gas field is located in the Straits of Hormuz approximately 12 km off the west coast of theMusandam Peninsula. The field was discovered by IPC in 1979. Three wells have been drilled on thestructure. Bukha-1 and Bukha-2 are situated close to the crest of the structure. Bukha-3 was drilleddirectionally from the Bukha-1 surface location down flank to the southwest. The field has been onproduction from two wells, Bukha-1 and -2, since 1994.3.2.1. DatabaseThe Bukha Field is covered by 2D seismic data that was acquired over a considerable span of time from1974 to 1986. These data have been the subject of a reprocessing exercise in 2001. Despite thisreprocessing numerous problems still exist of the type to be expected with 2D data in areas of high dipsnamely migration misties, out of plane reflections etc. A 3D survey was acquired during 2006/07, but is stillbeing processed by the operator.Production data from the field were provided by Heritage.3.2.2. Geology and GeophysicsThe field consists of a single contiguous NE-SW trending fault and dip closed structure covering an area ofapproximately 35 sq km. The tilted fault block is controlled by two main faults; the Tibat thrust and theBukha back-thrust. Fractured carbonate reservoirs within the Cretaceous Mauddud and ThamamaFormations occur at depths of between 2,900 and 3,500 m TVDSS. The Mauddud Formation has anaverage thickness of 52 m and is separated from the underlying Thamama Formation by the Nahr Umrshale with an average thickness of 106 m. The Thamama reaches a total thickness of around 650 m.Figure 5 shows a depth structure map of the Bukha Field. The area above structural spill that lies to thenorth of the North Bukha fault is known as North Bukha and it is not known whether this area is beingdrained by the production wells. If it becomes apparent that the reserves in the North Bukha area are notbeing produced then an appraisal well may be drilled.Figure 5:Bukha Field—Top Reservoir Depth Map21FEB20082315000779
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This document comprises a prospectu
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SUMMARY INFORMATIONThis summary mus
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Summary Consolidated Income Stateme
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Summary Consolidated Cash Flow Stat
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Production from the Zapadno Chumpas
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Given the geographic spread of the
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RISK FACTORSAny investment in the O
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wells may change as a result of low
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which could have a materially adver
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Failure to obtain additional financ
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contractual or pricing terms, both
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years. In addition, since December
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UgandaUganda is among the poorest c
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Market Price of the Ordinary Shares
Page 29 and 30: DIRECTORS, CORPORATE SECRETARY, SEN
Page 31 and 32: EXPECTED TIMETABLE OF PRINCIPAL EVE
Page 33 and 34: CurrenciesAll references in this do
Page 35 and 36: PART I—INFORMATION ON THE GROUPOV
Page 37 and 38: Strong management and technical tea
Page 39 and 40: the availability of existing infras
Page 41 and 42: In 2005, the Group acquired a 95 pe
Page 43 and 44: The Group acquired a 10 per cent. i
Page 45 and 46: The Group is the operator and has a
Page 47 and 48: exploration wells. The total estima
Page 49 and 50: The Group has also entered into a s
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Page 53 and 54: operational by drawing up an Enviro
Page 55 and 56: Mr. Buckingham has never had any as
Page 57 and 58: Date2007 ........ On 18 January 200
Page 59 and 60: (3) One common share of Heritage Ho
Page 61 and 62: (f) General Sir Michael WilkesGener
Page 63 and 64: Remuneration CommitteeThe Remunerat
Page 65 and 66: Goldsworth House, Denton Way, Golds
Page 67 and 68: ResourcesA summary of the gross Con
Page 69 and 70: The post tax Net Present Value (NPV
Page 71 and 72: RPS EnergyHeritage Oil - Competent
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RPS EnergyHeritage Oil - Competent
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RPS EnergyHeritage Oil - Competent
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Summary Consolidated Balance Sheets
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Summary Consolidated Balance Sheets
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locks during the first three and a
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On 2 October 2007, the Group execut
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of amplitude anomalies, further sup
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The increase in operating expenses
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5.11 Discontinued OperationsThe res
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6. RESULTS OF CONTINUING OPERATIONS
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6.7 Foreign Exchange LossesThere wa
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6.14 Capital ExpendituresThe follow
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7.3 Petroleum and Natural Gas Reven
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7.14 Capital ExpendituresAdditions
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10. LIQUIDITY AND CAPITAL RESOURCES
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Year Ended 31 December 2005 Prepare
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Intangible E&E assets related to ea
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11.2 The year ended 31 December 200
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(c) Reconciliation of loss for the
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Year Ended 31 December 2004 Prepare
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PART VII—FINANCIAL INFORMATIONA.
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DeclarationFor the purposes of Pros
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HERITAGE OIL LIMITEDNOTES TO BALANC
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AUDITED AND UNAUDITED FINANCIAL INF
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HERITAGE OIL CORPORATIONCONSOLIDATE
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HERITAGE OIL CORPORATIONNOTES TO CO
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Intangible E&E assets related to ea
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k) InvestmentsThe Group classifies
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usually when legal title passes to
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iii) IFRIC 12, ‘‘Service conces
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v) Liquidity riskLiquidity risk is
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ii) DerivativesDerivatives are reco
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5 Other finance costsNine-month per
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Congo to the other partners in the
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No assets have been pledged as secu
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31 December 30 September2005 2006 2
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16 Trade and other payables31 Decem
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A reconciliation of the asset retir
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21 Loss per shareThe following tabl
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25 Commitments and contingenciesHer
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In November 2007, the Group farmed-
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Reconciliation of loss for the year
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At the end of the last reporting pe
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Reconciliation of cash flow stateme
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At 31 December 2006, this has resul
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AUDITED FINANCIAL STATEMENTS RELATI
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AUDITORS’ REPORT TO THE SHAREHOLD
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HERITAGE OIL CORPORATIONNOTES TO CO
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effective as hedges, both at incept
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A ceiling test was undertaken at De
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6. Share capital:(a) Authorized:Unl
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fair value of stock options are amo
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C. PRO FORMA FINANCIAL INFORMATION
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PRO FORMA NET ASSET STATEMENTThe fo
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Production assumptionsProduction du
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Macroeconomic assumptionsThe Direct
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Accordingly, the Illustrative Proje
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Arrangement AgreementPursuant to th
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PART X—ADDITIONAL INFORMATION1. R
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(ii) no share or loan capital of th
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(j)In Alberta, the principal jurisd
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nominal amount has been paid up of
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instrument of transfer (in the case
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up on all the shares conferring tha
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(B) may be a director or other offi
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and is in default for a period of 1
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(c)have sufficient moneys, assets o
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(e)against surrender of the Exchang
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e, to the extent that the same is r
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(g)(ii) by arranging for the credit
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(b) rights, options or warrants oth
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any provision of provincial, territ
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7.5 None of the major shareholders
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Position stillDirector/Senior Manag
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employment or terminates his or her
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All rights of a holder of Exchangea
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agreement of this nature. These cir
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to change. Where the Company pays a
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As part of an agreement reached in
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(x) Foreign Property Information Re
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19. DOCUMENTS AVAILABLE FOR INSPECT
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declared and unpaid dividends on ea
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‘‘DTR’’‘‘DutchCo’’
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‘‘ISIN’’‘‘ITA’’‘
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anniversary of the Effective Date a
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‘‘Support Agreement’’‘‘
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emaining quantities recovered will
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