Our Business

Reserves

Working interest reserves included herein refer to working interest reserves before royalty deductions. Reserves information is based on an independent reserves evaluation report prepared by McDaniel with an effective date of December 31, 2016 (the "McDaniel Report"), and has been prepared in accordance with National Instrument 51-101 ("NI 51-101") using McDaniel's forecast prices and costs. Complete NI 51-101 reserves disclosure including after-tax reserve values, reserves by major property and abandonment costs will be included in Perpetual's Annual Information Form ("AIF"), available on the Corporation's website at www.perpetualenergyinc.com and SEDAR at www.sedar.com. Perpetual's reserves at December 31, 2016 are summarized below.

Working Interest Reserves at December 31, 2016(1)

 Reserve Category
Light and
Medium
Crude Oil
(Mbbl)
Heavy
Oil
(Mbbl)

Conventional

Natural Gas
(MMcf)

Natural
Gas
Liquids
(Mbbl)
Oil
Equivalent
(Mboe)

Proved Producing

26 1,218

37,555

486 7,989

Proved Non-Producing

-
120
2,122
23 496

Proved Undeveloped

11
335 146,778 1,802
26,611

Total Proved

37
1,672
186,455 2,311  35,096

Probable Producing

20
472
31,909
449 6,259

Probable Non-Producing

-
88

5,810

 77 1,134
Probable Undeveloped  (11) 272 102,573
1,437
18,793
Total Probable 9
832
140,292 1,963 26,186

Total Proved and Probable

46
2,504 326,747 4,274 61,283

 (1) May not add due to rounding.

 Total proved reserves at December 31, 2016 account for 57 percent (2015 - 57 percent) of total proved and probable reserves. Proved producing reserves of 8.0 MMboe comprise 23 percent (2015 - 40 percent) of total proved reserves. Proved and probable developed reserves of 15.9 MMboe represent 26 percent (2015 - 36 percent) of total proved and probable reserves. The material decrease in the percentage of producing and developed reserves at year-end 2016 relative to the prior year reflects the transformational Shallow Gas Disposition which was comprised primarily of producing and developed reserves with very little undeveloped reserves recognized. Although the Shallow Gas Disposition assets included 15.6 MMboe of proved and probable developed reserves recognized at year-end 2015, the value of those proved and probable developed reserves was deemed to be negligible at McDaniel's year-end 2015 commodity price and operating assumptions.