Questerre Energy Corporation ("Questerre" or the "Company") (TSX,OSE:QEC) reported today on an essential test of mechanical rock properties for its oil shale in Jordan.
Michael Binnion, President and Chief Executive Officer of Questerre, commented, "Finding a way to commercialize this significant oil shale project in a US$50 to US$70 per barrel environment is our main focus here. These tests establish that the mechanical rock properties of our shale are conducive to meeting this goal."
The Company's significant discovery on its oil shale acreage in Jordan was recently assessed by an independent qualified resource evaluator, Millcreek Mining Group, 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 ("COGE Handbook") (the "Resource Assessment"). The Resource Assessment estimates a best estimate of Discovered Petroleum Initially In Place ("DPIIP") of 12.24 billion barrels. Using a 2:1 volumetric ratio of overburden to ore, the best estimate of DPIIP for the lower rich horizon with an average grade of 22.66 gallons per ton is 7.78 billion barrels.
The Resource Assessment was prepared in accordance with NI 51-101 and the COGE Handbook with an effective date of October 1, 2016. For more information, please see the Company's press release dated October 27, 2016 and its Annual Information Form for the year ended December 31, 2016 dated March 24, 2017, available on the Company's website at www.questerre.com and SEDAR at www.sedar.com.
He added, "Minability and crushability, while maintaining compressive strength, are critical factors in the processing of oil shale. The mechanical rock properties testing has shown that our oil shale meets these criteria for all the technologies we are evaluating, including Red Leaf's EcoShale process."
The testing was conducted in conjunction with Red Leaf Resources Inc. ("Red Leaf"). Questerre continues to work collaboratively with Red Leaf. In a recent update to its shareholders, Red Leaf noted that it has reached an agreement with a subsidiary of the French supermajor, Total S.A., to exit their joint venture agreement. Red Leaf currently has over US$100 million in available cash and no debt. It intends to continue to pursue its business plan of commercializing the EcoShale process. Questerre currently holds approximately 6% of the equity capital of Red Leaf and has certain rights to use the EcoShale process to recover oil from shale.
The main objectives of the retort compression testing ("RCT") were to identify whether the shale could be directly heated without any deterioration in the quality and the specific mechanical properties of the spent shale under stress. The testing was successful on both counts.
Based on the results of the RCT, the next round of testing will identify the oil yield, including products and quality, from the Jordan oil shale using direct heating under various heating cycles. Testing is underway with results expected early this summer.
Questerre Energy Corporation is leveraging its expertise gained through early exposure to shale and other non-conventional reservoirs. The Company has base production and reserves in the tight oil Bakken/Torquay of southeast Saskatchewan. It is bringing on production from its lands in the heart of the high-liquids Montney shale fairway. It is a leader on social license to operate issues for its Utica shale gas discovery in the St. Lawrence Lowlands, Quebec. It is pursuing oil shale projects with the aim of commercially developing these significant resources.
SOURCE: Questerre Energy Corporation
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