Annual Report — [x] Reg. S-K Item 405 — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K405 Annual Report -- [x] Reg. S-K Item 405 42 244K
2: EX-4.3 Indenture Between Chase Manhattan and the Company 116 486K
3: EX-13 Portions of the Annual Report to Stockholders 26 188K
4: EX-21 Subsidiaries of the Company 1 6K
5: EX-23.1 Consent of Arthur Andersen LLP 1 6K
6: EX-23.2 Consent of Netherland, Sewell & Associates, Inc. 1 7K
7: EX-27 Financial Data Schedule 2 9K
8: EX-99.1 Letter Regarding U.S. Oil and Gas Reserve 4 19K
9: EX-99.2 Letter Regarding South America Oil and Gas Reserve 3 15K
EX-99.2 — Letter Regarding South America Oil and Gas Reserve
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EXHIBIT 99.2
[LETTERHEAD OF NETHERLAND, SEWELL & ASSOCIATES, INC. APPEARS HERE]
March 24, 1997
Mr. S. Craig George
Vintage Petroleum, Inc.
4200 One Williams Center
Tulsa, Oklahoma 74172
Dear Mr. George:
In accordance with your request, we have estimated the proved reserves and
future revenue, as of January 1, 1997, to the combined interests of Cadipsa
S.A., Vintage Oil Argentina, Inc., and Shamrock Ventures (Boliviana) Ltd.
(collectively referred to herein as "Total South America") in certain oil and
gas properties located in the South American countries of Argentina and Bolivia
as listed in the accompanying tabulations. This report has been prepared using
constant prices and costs and conforms to the guidelines of the United States
Securities and Exchange Commission (SEC). All prices, costs, and revenue
estimates are expressed in United States dollars ($).
As presented in the accompanying summary projections, Tables I through IV,
we estimate the net reserves and future net revenue to the Total South America
interest, as of January 1, 1997, to be:
[Download Table]
Net Reserves Future Net Revenue (M$)
----------------------- --------------------------
Oil Gas Present Worth
Category (Barrels) (MCF) Total at 10%
------------------ ---------- ---------- ----------- -------------
Proved Developed
Producing 34,963,303 46,238,051 438,660.2 303,863.1
Non-Producing 12,625,237 5,037,491 213,675.1 114,584.9
Proved Undeveloped 36,369,617 6,482,517 519,343.0 270,319.6
---------- ---------- --------- ---------
Total Proved 83,958,157 57,758,059 1,171,678.3 688,767.6
The oil reserves shown include crude oil and condensate. Oil volumes are
expressed in barrels which are equivalent to 42 United States gallons. Gas
volumes are expressed in thousands of standard cubic feet (MCF) at the contract
temperature and pressure bases.
As shown in the Table of Contents, this report includes summary projections
of reserves and revenue for each country by reserve category. Summary
projections of reserves and revenue for each company by reserve category along
with one-line summaries of reserves, economics, and basic data by lease are also
included behind the appropriate tabs. For the purposes of this report, the term
"lease" refers to a single economic projection.
The estimated reserves and future revenue shown in this report are for
proved developed producing, proved developed non-producing, and proved
undeveloped reserves. In accordance with
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SEC guidelines, our estimates do not include any value for probable or possible
reserves which may exist for these properties. This report does not include any
value which could be attributed to interests in undeveloped acreage beyond those
tracts for which undeveloped reserves have been estimated.
Future gross revenue to the Total South America interest is prior to
deducting provincial production taxes. Future net revenue is after deducting
these taxes, future capital costs, and operating expenses, but before
consideration of Argentine, Bolivian, or United States federal income taxes. In
accordance with SEC guidelines, the future net revenue has been discounted at an
annual rate of 10 percent to determine its "present worth." The present worth
is shown to indicate the effect of time on the value of money and should not be
construed as being the fair market value of the properties.
For the purposes of this report, a field inspection of the properties has
not been performed nor has the mechanical operation or condition of the wells
and their related facilities been examined. We have not investigated possible
environmental liability related to the properties; therefore, our estimates do
not include any costs which may be incurred due to such possible liability.
Also, our estimates do not include any salvage value for the lease and well
equipment nor the cost of abandoning the properties.
Oil prices used in this report are based on a December 31, 1996 New York
Mercantile Exchange spot price of $25.78 per barrel, adjusted by field for
gravity, transportation fees, marketing fees, and regional price differentials.
Oil prices are held constant in accordance with SEC guidelines. Gas prices used
in this report are based on contract prices, adjusted for transportation fees
and BTU content. These prices are adjusted according to the provisions of
existing gas contracts which remain in effect throughout the life of the
properties.
Lease and well operating costs are based on operating expense records of
Vintage Petroleum, Inc. (Vintage). For recently acquired properties for which
there are not adequate historical operating expense records, the operating
expense estimates of Vintage have been used. For non-operated properties, these
costs include the per-well overhead expenses allowed under joint operating
agreements along with costs estimated to be incurred at and below the district
and field levels. As requested, lease and well operating costs for the operated
properties in Argentina include only direct lease and field level costs, while
these costs for the operated properties in Bolivia also include the overhead
cost of maintaining an office in Santa Cruz, Bolivia. Headquarters general and
administrative overhead expenses of Vintage are not included. For certain
recently acquired properties, lease and well operating costs are adjusted to
reflect Vintage's intention to modify procedures upon obtaining operational
control of the properties. In accordance with SEC guidelines, lease and well
operating costs are held constant throughout the life of the properties with the
exception of the adjustments described herein. Capital costs are included as
required for workovers, new development wells, and production equipment.
The reserves included in this report are estimates only and should not be
construed as exact quantities. They may or may not be recovered; if recovered,
the revenues therefrom and the costs related thereto could be more or less than
the estimated amounts. The sales rates, prices received for the reserves, and
costs incurred in recovering such reserves may vary from assumptions included in
this report due to governmental policies and uncertainties of supply and demand.
Also, estimates of reserves may increase or decrease as a result of future
operations.
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In evaluating the information at our disposal concerning this report, we
have excluded from our consideration all matters as to which political,
socioeconomic, legal, or accounting, rather than engineering and geological,
interpretation may be controlling. As in all aspects of oil and gas evaluation,
there are uncertainties inherent in the interpretation of engineering and
geological data; therefore, our conclusions necessarily represent only informed
professional judgments.
The titles to the properties have not been examined by Netherland, Sewell &
Associates, Inc., nor has the actual degree or type of interest owned been
independently confirmed. The data used in our estimates were obtained from
Vintage Petroleum, Inc. and the nonconfidential files of Netherland, Sewell &
Associates, Inc. and were accepted as accurate. We are independent petroleum
engineers, geologists, and geophysicists; we do not own an interest in these
properties and are not employed on a contingent basis. Basic geologic and field
performance data together with our engineering work sheets are maintained on
file in our office.
Very truly yours,
/s/ Frederic D. Sewell
TJT:LJH
Dates Referenced Herein and Documents Incorporated by Reference
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| This ‘10-K405’ Filing | | Date | | First | | Last | | | Other Filings |
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| |  |
| Filed on: | | 3/27/97 | | | | | | | DEF 14A |
| | 3/24/97 | | 1 |
| | 1/1/97 | | 1 |
| For Period End: | | 12/31/96 | | 2 |
| List all Filings |
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