REEVALUATION OF PETROLEUM RESOURCES

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The company has completed a new assessment of its petroleum resources that takes into account both the new information from the area and further development of production technology. The Board has considered this reassessment and given its approval, but has at present chosen not to conduct a new independent evaluation.

Working Interest Total Petroleum
Initially-In-Place (PIIP)
CHARD (100%):
• McMurray 352
• Devonian 50
CARMANGAY (50%):
• Oil 1,5
• CBM (boe) 0,25
TOTAL 404


(All figures include the sum of proven and non-proven resources (PIIP is based on the COGEH standard in Canada) and are regarded as P50 (Best Estimate) and are given in MMBOE.)

Of the known resource volumes the company possesses in layers of => 5 m, there is a potential of up to 157 million barrels that can be upgraded to contingent resources (potentially recoverable from known accumulations), after completing the coring project in 2012. The value of this can be estimated up to CAD 78.5 million (100% basis), based on market transactions indicating valuations of about 50 cents a barrel. The resource estimate is therefore expected to increase after the core drilling is completed, and is expected to increase the contingent resources in the process as well as upgrading some resources to reserves.
The royalty agreement for Svalbard and Greenland does not have any allocated value.

Based on these figures, the company’s short-term goal remains to establish a farm-out agreement that will ensure the implementation of a broader appraisal program on Chard. This program will reduce the uncertainty in the assessments and make it possible to book the formal reserves. As previously announced, the company also intends to implement new production tests and probable commercial production from Carmangay. The progress here is primarily dependent on clarification from the other partners in the lease.

The Board also considers that the market for heavy oil is undergoing constant improvement and development towards higher prices and valuation of such resources. With the board working diligently towards the development of Chard it is reasonably clear that the value creation so far has been positive and will likely continue that way. The company is debt free and the potential is formidable.

Fredrikstad, Norway 06.12.2011

Nordic Petroleum AS
Contact Arild Tolfsen with enquiries,
Mobile : +47 93 09 98 59, E-mail : arild.tolfsen@nop.as