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Lundin Petroleum ups 2011 reserve estimate

Last updated: 08:41 05 Jan 2012 EST, First published: 09:41 05 Jan 2012 EST

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Lundin Petroleum (TSE:LUP)(OMX:LUPE) Thursday said its net proven and probable working interest reserves at the end of 2011 amounted to 210.7 million barrels, a 21 percent increase on 2010.

Oil accounted for 85 percent of the total, according to an independent assessment by Gaffney Cline & Associates.

The increase gave the company a 264 percent reserves replacement ratio, which is defined as the ratio of reserve additions in 2011 over reserves as at the end of 2010.

Chief executive Ashley Heppenstall said: "In Norway new reserve additions at Tellus and Boyla as well as reserve upgrades at Alvheim and Volund have contributed to another year of reserve increases and a strong reserve replacement ratio.

"The Avaldsnes/ Aldous Major South appraisal and discovery has resulted in a significant increase to our contingent resource base and will lead to further reserve increases as this project is moved forward."

The reserves were calculated using an oil price of $100 per barrel in 2012, with prices and costs escalating at 2 percent per annum.

The biggest reserves boost came in Norway, volume increases at the Alvheim and Volund fields as well as Luno, where the Tellus discovery and reservoir model updates increased resources. The inclusion of Boyla in the reserves numbers as well as Lundin's acquisition of a further 20 percent in the Brynhild field also contributed to the increase.

Late last year the company also reported progress in its drilling activities in Malaysia and the Congo.

The company recorded contingent resources last year of 731 million barrels of oil equivalent, including contributions from Avaldsnes and its Malaysian finds, Cempulut, Titik Taran and Tarap, to give it a total resource base of more than 1 billion barrels.

Lundin Petroleum is an independent Swedish oil and gas exploration and production company. Production is generated from assets in Norway, France, Tunisia, Netherlands, Russia and Indonesia.

In addition, Lundin said it has significant upside potential within these areas of operation including undeveloped oil and gas discoveries and ongoing exploration programmes.

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