Delphi Energy Corp.

TSX: DEE

February 9, 2011

Delphi Energy Reports 10 Million BOE in Reserve Additions

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CALGARY, ALBERTA -- Delphi Energy Corp. ("Delphi" or the "Company") (TSX:DEE) is pleased to report its crude oil and natural gas reserves information for the year ended December 31, 2010.

2010 Highlights

  • Increased total proved reserves by 26 percent to 22.7 million barrels of oil equivalent ("boe") and total proved plus probable reserves by 26 percent to 34.5 million boe compared to 2009. Total proved plus probable reserves have doubled over the past 3 years.
  • Increased total proved plus probable crude oil and natural gas liquids reserves by 89 percent and total proved plus probable natural gas reserves by 17 percent compared to 2009.
  • Increased total proved plus probable reserves per share by 13 percent in 2010.
  • Added 10.1 million boe of total proved plus probable reserves (net of revisions and dispositions) in 2010, replacing 2010 production by 342 percent.
  • Achieved finding, development and acquisition costs ("FD&A") of $14.94 per boe for total proved plus probable reserves in 2010 and average FD&A costs over the past three years of $14.77 per boe for total proved plus probable reserves.
  • Achieved record production during the fourth quarter of 8,539 boe/d, representing a 24 percent increase over the comparative quarter in 2009. Average production for 2010 increased 18 percent to 8,086 boe/d, while production per share increased 6 percent.
  • Increased proved plus probable reserve life index ("RLI") to 11.7 years in 2010 compared to 11.0 years in 2009.
  • Increased net undeveloped land to 244,475 net acres, a 42 percent increase over 2009.
Reserves at December 31 2010   2009   % Change  
  Proved Producing (mboe) 13,944   12,278   14  
  Total Proved (mboe) 22,721   18,018   26  
  Proved plus Probable (mboe) 34,521   27,391   26  
             
Proved plus Probable Reserve Life Index (years) 11.7   11.0   6  
Proved plus Probable Reserve Replacement Ratio 3.4   3.2   6  
Proved plus Probable Reserves per 1,000 Shares (boe) 306.0   270.8   13  
             
Total Proved FD&A including Future Development Costs ("FDC") ($/boe) (1) 18.10   12.06   50  
Proved plus Probable FD&A including FDC ($/boe) (1) 14.94   9.21   62  
             
Operating Netback ($/boe) (1) 24.36   24.10   1  
Proved plus Probable Recycle Ratio 1.6   2.6   (38)  
             
Undeveloped Land (net acres) 244,475         172,209   42  
Undeveloped Land Value ($ 000's) 27,650           16,695   66  

Note:

  1. Certain financial and operating information included in this press release for the quarter and year ended December 31, 2010, such as finding and development costs, production information, operating netbacks, recycle ratios and net asset value calculations are based on estimated unaudited financial results for the year ended December 31, 2010 and are subject to the same limitations as discussed under forward-looking statements outlined at the end of this release. These estimate amounts may change upon completion of the audited financial statements for the year ended December 31, 2010 and those changes may be material.

Reserves Summary

GLJ Petroleum Consultants Ltd. ("GLJ"), the Company's independent petroleum engineering firm, has evaluated Delphi's crude oil, natural gas and natural gas liquids reserves as at December 31, 2010 and prepared a reserves report in accordance with National Instrument 51-101 "Standards of Disclosure for Oil and Gas Activities" and the "Canadian Oil and Gas Evaluation Handbook".

To view a chart of Delphi's Year End Reserves, please visit the following link: http://media3.marketwire.com/docs/209dee1.pdf

Following is summary information detailed in the GLJ reserves report at December 31, 2010 as compared to December 31, 2009.

  December 31, 2010   December 31, 2009
  Gas Oil & NGLs   Total % of   Total    
Reserves(1) (mcf) (mbbls)   (mboe)(2) P+P   (mboe)(2)   % Change
Proved                  
  Producing 68,544 2,520   13,944 40   12,278   14
  Non-producing 13,161 663   2,857 8   2,173   31
  Undeveloped 26,483 1,507   5,920 17   3,567   66
Total proved 108,188 4,690   22,721 66   18,018   26
Probable 57,579 2,203   11,800 34   9,373   26
Total proved plus probable 165,767 6,893   34,521 100   27,391   26
                   

Notes:

  1. Delphi's reserves represent the operated and non-operated working interest share of reserves before deduction of royalties and include any royalty interests of the Company.
  2. Oil equivalent amounts have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil (6:1).
  3. Table numbers have been rounded.

Net Present Value of Reserves

In 2010, the reserve additions of 10.1 million boe largely offset the change in GLJ's forecast natural gas prices as of January 1, 2011 as compared to January 1, 2010. The estimated future net revenues associated with Delphi's reserves at December 31, 2010 based on the GLJ January 1, 2011 price forecast are summarized in the following table.

  Future net revenues before income taxes discounted at a rate of:  
($ thousands)(1) 0 % 10 % 15 %
Proved            
  Producing 324,704   207,834   177,038  
  Non-producing 68,852   32,957   25,942  
  Undeveloped 121,867   48,808   32,861  
Total proved 515,423   289,599   235,841  
Probable 318,641   109,855   75,933  
Total proved plus probable 834,064   399,454   311,774  

Note:

  1. The estimated future net revenues are before the deduction of estimated future site restoration costs but are reduced for estimated future abandonment costs for reserve wells and estimated capital for future development associated with the reserves.

Reserves Reconciliation

The following reconciliation of Delphi's reserves compares changes in the Company's reserves at December 31, 2009 to the reserves at December 31, 2010, each evaluated in accordance with National Instrument 51-101 definitions.

  Proved
(mboe
) Probable
(mboe
) Proved plus probable
(mboe
)
Reserves at December 31, 2009 18,018   9,373   27,391  
Extensions and improved recovery 8,311   2,048   10,359  
Technical revisions (183 ) 632   449  
Dispositions (281 ) (210 ) (491 )
Economic factors (192 ) (43 ) (235 )
Production (2,952 ) -   (2,952 )
Reserves at December 31, 2010 22,721   11,800   34,521  

Finding and Development Costs

Finding and development costs in 2010 and over the past three years were as follows: 

  2010   2008 - 2010  
Capital ($ thousands) Total Proved   Proved plus Probable   Total Proved   Proved plus Probable  
  Exploration and development ("E&D") expenditures 106,057   106,057   216,782   216,782  
  Change in FDC related to E&D additions 32,878   46,046   60,307   90,552  
  Change in FDC related to acquisitions and dispositions ("A&D") (177 ) (1,257 ) 7,965   6,536  
  Total on-stream costs 138,758   150,846   285,054   313,870  
  Acquisitions 19   19   85,026   85,026  
  Dispositions (248 ) (248 ) (29,416 ) (29,416 )
  Total capital invested 138,529   150,617   340,664   369,480  
                 
Finding and Development Costs ($/boe)                
  E&D, excluding FDC 13.36   10.03   14.14   11.05  
  E&D, including change in FDC related to E&D additions 17.51   14.39   18.08   15.67  
  Exploration, development, acquisitions and dispositions,
including total change in FDC
18.10   14.94   17.81   14.77  

Total exploration and development costs incurred in the most recent financial year and the change during that year in estimated future development costs generally will not reflect the total cost of reserve additions in that year.

Acreage Summary

The Company significantly increased its land holdings over the past year primarily through Crown land sales.  Undeveloped land holdings increased to 244,475 net acres in 2010, a 42 percent increase over 2009.  Total net land increased 26 percent to 349,177 net acres.  Delphi has regulatory approval to drill up to four natural gas wells per pool per section on the Company's developed and undeveloped lands at its three core properties of Bigstone, Hythe and Wapiti/Gold Creek.

To view a chart of Delphi's Year End Net Landholdings, please visit the following link: http://media3.marketwire.com/docs/209dee2.pdf

Net Asset Value

The estimated net asset value of the Company at December 31, 2010 has been calculated using before tax, net present value of reserves discounted at ten percent as follows:

($ thousands except per share data) 2010   2009   % Change  
Discounted value of proved plus probable reserves(1) 399,454   392,265   2  
Undeveloped land(2) 27,650   16,695   66  
Mark-to-market value of hedging contracts 650   3,943   (84 )
In-the-money option proceeds(3) 9,248   4,149   123  
Total asset value 437,002   417,052   5  
Bank debt plus working capital deficiency (unaudited) (108,054 ) (92,467 ) 17  
Net asset value 328,948   324,585   1  
Basic shares outstanding and in-the-money options 119,632,109   105,174,132   14  
Net asset value per share 2.75   3.09   (11 )

Notes:

  1. Before tax and reclamation costs. The Company estimates it has approximately $270 million of tax deductions available to offset future taxable income.
  2. Undeveloped land is based on the estimated land value in Seaton-Jordan & Associates Ltd. land valuation report.
  3. In-the-money option proceeds are based on the closing December 31, 2010 share price of $2.17.

Delphi anticipates releasing its audited financial statements for the year ended December 31, 2010 on or about March 16, 2011 and its Annual Information Form by March 31, 2011, which will include all required National Instrument 51-101 reserves disclosure.

Delphi Energy Corp. is a Calgary-based company that explores, develops and produces oil and natural gas in Western Canada. The Company is led by an experienced management team with proven technical expertise in the Company's core areas in the Deep Basin. Delphi trades on the Toronto Stock Exchange under the symbol DEE.

This press 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", may", "will", "should", believe", "intends", "forecast", "plans", "guidance" and similar expressions are intended to identify forward-looking statements or information.

More particularly and without limitation, this press release contains forward-looking statements and information relating to the Company's risk management program, petroleum and natural gas production, future funds flow from operations, capital programs, natural gas prices and debt levels. The forward-looking statements and information are based on certain key expectations and assumptions made by Delphi, including expectations and assumptions relating to prevailing commodity prices and exchange rates, applicable royalty rates and tax laws, future well production rates, the performance of existing wells, the success of drilling new wells, the capital availability to undertake planned activities and the availability and cost of labour and services.

Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations 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 may differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the uncertainty of estimates and projections relating to production rates, costs and expenses, commodity price and exchange rate fluctuations, marketing and transportation, environmental risks, competition, the ability to access sufficient capital from internal and external sources and changes in tax, royalty and environmental legislation. Additional information on these and other factors that could affect the Company's operations or financial results are included in reports on file with the applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). The forward-looking statements and information contained in this press release are made as of the date hereof for the purpose of providing the readers with the Company's expectations for the coming year. The forward-looking statements and information may not be appropriate for other purposes. Delphi 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.

Reserve replacement ratio is calculated as the ratio of reserve additions from exploration, development, acquisition and disposition plus reserve revisions to total yearly production on a barrel of oil equivalent basis.

Operating netback is calculated as revenue less royalties, operating costs and transportation costs on a barrel of oil equivalent basis.

A barrel of oil equivalent (boe), derived by converting gas to oil in the ratio of six thousand cubic feet of gas to one barrel of oil, may be misleading, particularly if used in isolation. A boe conversion is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

For more information, please contact

Delphi Energy Corp.
David J. Reid
President & CEO
(403) 265-6171
(403) 265-6207 (FAX)
 
or
Delphi Energy Corp.
Brian P. Kohlhammer
V.P. Finance & CFO
(403) 265-6171
(403) 265-6207 (FAX)
 
or
Delphi Energy Corp.
300, 500 - 4 Avenue S.W.
Calgary, Alberta
T2P 2V6
info@delphienergy.ca
www.delphienergy.ca
 
-----
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-----

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Data and Statistics for these countries : Canada | Jordan | All
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Delphi Energy Corp.

CODE : DEE.TO
ISIN : CA2471281014
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Delphi is a exploration company based in Canada.

Delphi is listed in Canada and in United States of America. Its market capitalisation is CA$ 54.9 millions as of today (US$ 39.5 millions, € 36.0 millions).

Its stock quote reached its highest recent level on December 30, 2005 at CA$ 6.15, and its lowest recent point on November 29, 2019 at CA$ 0.05.

Delphi has 156 900 000 shares outstanding.

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Financings of Delphi Energy Corp.
12/2/2011Announces Equity Financing
3/28/2011Closes Flow-Through Financing
6/3/2010Announces Closing of $30.25 Million Equity Offering
5/27/2010Announces Increased Credit Facility
Nominations of Delphi Energy Corp.
3/16/2010Announces Appointment of Directors
Financials of Delphi Energy Corp.
11/14/2013Reports Third Quarter Results
8/15/2013Reports Second Quarter Results
5/16/2013Reports Financial and Operational Results for First Quarter ...
8/9/2012Reports Financial and Operational Results for Second Quarter...
5/9/2012Reports Financial and Operational Results for First Quarter ...
3/15/2012Reports Fourth Quarter and Year End Results
5/26/2011Reports Financial and Operational Results for First Quarter ...
3/17/2011Reports Fourth Quarter and Year End Results
5/6/2010Reports Strong Financial and Operational Results for First Q...
Project news of Delphi Energy Corp.
9/3/2013Releases Midyear 2013 Reserves Update
7/3/2013Reports Continued Montney Drilling Success
6/20/2011Kicks Off Second Half 2011 Drilling Program
2/10/2011Reports 10 Million BOE in Reserve Additions
Corporate news of Delphi Energy Corp.
6/15/2016Delphi Energy Announces Closing of $60 Million Offering
6/3/2016Delphi Energy Announces Increase and Pricing of Offering
6/2/2016Delphi Energy Announces Voting Results from its Annual Gener...
5/28/2016Delphi Energy Announces Filing of Preliminary Short Form Pro...
5/28/2016Delphi Energy Announces Banking Update
5/11/2016Delphi Energy Reports First Quarter 2016 Results
12/29/2015Delphi Energy Provides Update
11/3/2015Delphi Energy Announces Closing of Disposition of Hythe Asse...
10/15/2015Delphi Energy Announces Agreement to Sell Greater Hythe Asse...
8/10/2015Delphi Energy Reports Second Quarter Results
7/23/2015Delhi Energy Announces Closing of Disposition of Wapiti Asse...
7/23/2015Delphi Energy Announces Closing of Disposition of Wapiti Ass...
7/2/2015Delphi Energy Grants an Extension to Closing of Greater Wapi...
3/20/2015Delphi Energy Releases Year End 2014 Reserves
3/20/2015Delphi Reports 2014 Year End Results
3/19/2015Delphi Energy Reports 2014 Year End Results
2/26/2015Delphi Energy Releases Year End 2014 Reserves
12/19/2014Delphi Energy Announces Increased Credit Facility
11/13/2014Delphi Energy Reports Third Quarter Results
10/23/2014Delphi Energy Provides Operations Update
9/10/2014IIROC Trade Resumption - DEE
9/9/2014IIROC Trading Halt - DEE
9/9/2014Delphi Energy Montney Success Continues
8/14/2014Delphi Energy Reports Second Quarter Results
7/24/2014Delphi Energy Provides Operations Update
6/13/2014Delphi Energy Corp. - Archive Webcast of June 11, 2014 EPAC ...
6/3/2014Delphi Energy Announces Annual Meeting Results
5/14/2014Delphi Energy Reports Record Quarterly Results
3/31/2014Delphi Energy Announces Increased Credit Facility and Provid...
3/19/2014Delphi Energy Reports 2013 Year End Results
12/23/2013Announces Funding Arrangement and Provides Operations Update
11/26/2013Reports Continued Success at Bigstone
10/23/2013Reports Continued Drilling Success
9/10/2013Continues Growth in Bigstone Montney Land Position
3/26/2013Acquires Additional Montney Assets in Bigstone
3/21/2013Reports 2012 Year End Results
12/12/2012Increases Bigstone Montney Exposure by 60 Percent With Recen...
9/10/2012- Peters & Co. Limited 2012 Energy Conference Webcast - ...
7/30/2012Reports Tests Results From Third Montney Well at Bigstone Ea...
7/24/2012Announces Closing of Disposition of Cardium Interests
6/28/2012Announces Agreement to Sell Cardium Interests for $23 Millio...
5/22/2012Commences Production at Its Bigstone East Montney Project
3/22/2012Provides Bigstone Operations Update
3/22/2012Provides Bigstone Operations Update
3/1/2012Increases Year End 2011 Reserves to Over 40 Million BOE with...
1/19/2012Completes First Bigstone Montney Well
7/28/2011Reports Record Production of 8,906 BOE/D For Second Quarter ...
5/18/2011Announces Increased Credit Facilities
3/18/2011Announces $9 Million Non-Brokered Private Placement Financin...
3/9/2011Reports Continued Success in the Nikanassin
2/17/2011Winter Program Delivering Results
5/13/2010Announces Equity Financing
4/1/2010Files 2009 Annual Information Form - AGM Scheduled May 20, 2...
1/13/2010Provides Operational Update
10/6/2009Announces Take-Up of Shares and Extension of Offer to Acquir...
9/10/2009Announces Financing
9/1/2009Announces Closing of Wapiti/Gold Creek Acquisition and Maili...
8/21/2009to Acquire Fairmount Energy
11/6/2008Reports 44% Increase in Cash Flow on Record Production
9/25/2008Validates Hythe Growth Potential With Recent Drilling Succes...
8/1/2008Achieves Record Production, Strengthens Balance Sheet in Q2 ...
7/25/2008Closing of Peace River Arch Acquisition
6/27/2008Announces Peace River Arch Acquisition and Financing
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