Microsoft Word - Target ASX 250915 Reserves Update Final.docx Proven Reserves of 0.27 million barrels of oil equivalent (MMBOe) Proven and Probable reserves of 0.51 MMBOe Total Reserves and Resources of 1.56 MMBOe Target Energy Limited's ('Target') 30 June 2015 proven oil reserves have been assessed at 0.27 million barrels of oil equivalent (MMBOe), with total Proved, Possible and Probable Reserves assessed at 0.51 MMBOe, according to recent independent Reserves Estimates. The Reserves Estimates, effective 30 June 2015, encompass the Company's interests in its Texas and Louisiana oil and gas producing properties. Commenting on the results, Target Energy's Managing Director Laurence Roe said: 'The Company notes the reduction in reserves in comparison to 2014. While this is primarily a consequence of the drop in oil prices, we also note that in a number of Fairway wells, there are additional pay zones that are yet to be completed for production and thus have not been able to be included in the reserves as there are no local analogs. 'In addition, as noted by the auditor, Target also has significant additional acreage in the Fairway area for additional development, however many of these potential locations are too far removed from existing wells to be assigned reserves. Despite the very challenging times, the Company continues to consider a range of options to add value to its assets.' The Reserves Reports were commissioned by Target and conducted by Texas‐based independent consultants T.J. Smith & Company, Inc. ('TJSCO': Fairway and East Chalkley Projects) and Harper & Associates, Inc. ('Harper': Section 28 and Merta Projects) in accordance with the definitions and guidelines set out in the 2007 Petroleum Resources Management System approved by the Society of Petroleum Engineers. A summary of the results is shown as Table 1 (below) with further details included in the Appendices. ASX Code: TEX OTCQX Code: TEXQY Board of Directors Chris Rowe, Chairman Laurence Roe, Managing Director Stephen Mann, Director Rowan Caren, Company Secretary ABN Number 73 119 160 360 Contact details 6 Richardson St, Suite 5 West Perth WA 6005 Tel: +61 8 9476 9000 1900 St James Place, Suite 425 Houston Tx 77056 USA Tel: +1 713 275 9800 E: admin@targetenergy.com.au W: www.targetenergy.com.au Media Inquiries: Australia Laurence Roe Managing Director +61 8 9476 9000 TARGET ENERGY LIMITED Address 6 Richardson St (Suite 5), West Perth WA 6005 1 Mailing Address PO Box 140 West Perth WA 6872 ABN 73 119 160 360 | Ph +618 9476 9000 Fax +618 9476 9099 | email admin@targetenergy.com.au | www.targetenergy.com.au 30 September 2015 Category Net Reserves & Resources BOE Oil (Mbbls) Gas (MMscf) (Mboe) Proved Developed Producing (PDP) 42.1 143.0 65.9 Proved Developed Not Producing (PDNP) 34.1 264.7 78.2 Proved Undeveloped (PUD) 95.4 190.9 127.2 Total Proved Reserves (1P) 171.6 598.6 271.4 Probable 166.7 407.7 234.6 Total Proved & Probable Reserves (2P) 338.3 1006.2 506.0 Possible 128.7 353.7 187.6 Total Proved, Probable & Possible Reserves (3P) 467.0 1359.9 693.6 Low Estimate Contingent Resources ‐ ‐ ‐ Best Estimate Contingent Resources 342.4 0.0 342.4 High Estimate Contingent Resources 525.3 0.0 525.3 Total Contingent Resources (3C) 867.7 0.0 867.7 Total Reserves & Resources 1,334.7 1,359.9 1,561.3 Notes: Table 1: Target Energy Net Reserves & Resources - 30 June 2015 Reserves are stated net to Target's working interest and after deductions for royalty payments. All reserves and resource estimates were prepared using deterministic methods. All aggregation was performed by arithmetic summation. Cautionary note: the aggregate 1P estimate may be a very conservative estimate and the aggregate 3P estimate may be very optimistic due to the portfolio effects of arithmetic summation. Similarly, the aggregate 2C + 3C resource estimate may be very optimistic due to the portfolio effects of arithmetic summation. TJSCO did not review the Contingent Resources for the East Chalkley Field. The Contingent Resources are derived from the Independent Technical Specialist's Report on Target Energy Limited's interests in the East Chalkley Field, (August 2012) by Risc Operations Pty Ltd. Contingent resources are defined as quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations by application of development projects but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingent Resources are a class of discovered recoverable resources as defined in the SPE‐PRMS. 'bbl(s)' means barrel(s); 'bopd' or 'boepd' means barrels of oil per day and barrels of oil equivalent per day, respectively 'boe' means barrels of oil equivalent. Target reports boe using a gas to oil conversion based on equivalent thermal energy , i.e. 6000 cubic feet of gas = 1 barrel of oil 'M' prefix means thousand; 'MM' prefix means million; 'scf' means standard cubic feet Production quantities are measured at the leases via a sales meter (gas) or in oil storage tanks. For and on behalf of TARGET ENERGY LIMITED Managing Director NOTE: In accordance with ASX Listing Rules, any hydrocarbon reserves and/or drilling update information in this report has been reviewed and signed off by Mr. Laurence Roe, B Sc, Managing Director of Target Energy, who is a member of the Society of Exploration Geophysicists and has over 30 years' experience in the sector. He consents to that information in the form and context in which it appears. TARGET ENERGY LIMITED Address 6 Richardson St (Suite 5), West Perth WA 6005 2 Mailing Address PO Box 140 West Perth WA 6872 ABN 73 119 160 360 | Ph +618 9476 9000 Fax +618 9476 9099 | email admin@targetenergy.com.au | www.targetenergy.com.au 30 September 2015 APPENDIX 1 The following table provides TJSCO's reserve estimates for Target's net interest in the Fairway Project. Methodology is described below. TJSCO was not asked to assess the contingent or prospective resource potential of the Fairway Project. The Operator of the project is Trilogy Operating, Inc. Leases are described in Table 3. Additional drilling is required to develop the leases. Fairway Project Net Reserves1 Net Reserves BOE Oil (Mbbls) Gas (MMscf) (Mboe) Proved Developed Producing 41.9 103.3 59.1 Proved Developed Not Producing 33.1 83.7 47.1 Proved Undeveloped 95.4 190.9 127.2 Total Proved (1P) 170.4 377.9 233.4 Probable 91.6 168.5 119.7 Proved & Probable (2P) 262.0 546.4 353.1 Possible2 82.7 165.3 110.3 Proved, Probable & Possible (3P) 344.7 711.7 463.3 Reserves are stated net to Target's working interest and after deductions for royalty payments. 2. Possible reserves are those reserves that are less certain to be recovered than probable reserves. There is a 10% probability that the quantities actually recovered will be equal to or exceed the sum of the Proved plus Probable plus Possible (3P) reserves. TARGET ENERGY LIMITED Address 6 Richardson St (Suite 5), West Perth WA 6005 3 Mailing Address PO Box 140 West Perth WA 6872 ABN 73 119 160 360 | Ph +618 9476 9000 Fax +618 9476 9099 | email admin@targetenergy.com.au | www.targetenergy.com.au 30 September 2015 Target Energy Leaseholdings Lease Name County / Ph Description Depth Limits TEX WI Gross acres Net acres Fairway BOA Howard S12 S/2 , Block 33 T‐2S, A‐1353, T&P RR Survey None 50.0% 320.0 160.0 BOA North Howard S12 N/2 , Block 33 T‐2S, A‐1353, T&P RR Survey None 50.0% 320.0 160.0 Darwin N/2 Howard S44 N/2, Block 33, T‐1S, A‐1292, T&P RR Survey None 50.0% 320.0 160.0 Darwin SW/4 Howard S44 SE/4, Block 33, T‐1S, A‐1292, T&P RR Survey None 60.0% 160.0 96.0 Bunbury Howard S102 A‐1405; S103 A‐1405; S104 A‐1495; Block 29 Waco None 60.0% 918.0* 550.8 & NW Survey Ballarat Glasscock S 184 and 185, Bl 28, A‐815 and A‐A483, Waco and None 50.0% 160.0 80.0 Northwestern Survey ... More