Changes for the year ended December 31, 2012, include a reclassification of 15 MMBbl of proved
undeveloped reserves to proved developed reserves related to the successful remediation efforts in
treating the near wellbore productivity issues on certain of the producing wells in the Jubilee Field and
continued field developmental drilling through the Phase 1A development of the Jubilee Field. These
successful remediation efforts reduced the number of future drilling locations for the Jubilee Field
(which included drilling locations related to our proved undeveloped reserves) and, as a result,
approximately 5 MMBbl of proved undeveloped reserves from December 31, 2011 converted to proved
developed reserves as of December 31, 2012. Additional changes include a decrease of 14 Bcf in proved
gas reserves due to a decrease in our estimate of fuel gas which will be utilized for operating the
FPSO. As a result of progress on the Phase 1A development, approximately 10 MMBbl of proved
undeveloped reserves from December 31, 2011 converted to proved developed reserves as of
December 31, 2012. During the year ended December 31, 2012, we incurred $16 3.7 million of capital
expenditures related to Phase 1A.
Changes for the year ended December 31, 2011, include an increase of 8 MMBbl of proved
undeveloped oil reserves due to the reclassification of some of the proved developed producing
volumes to proved undeveloped for volumes related to the remediation efforts to mitigate the near
wellbore productivity issues on certain of the producing wells in the Jubilee Field and an increase in
our Jubilee Field unit interest. Additional changes include an increase of 4 Bcf in proved undeveloped
gas reserves due to an increase in our Jubilee Field unit interest (see ‘‘Item 8. Financial Statements and
Supplementary Data—Note 3—Jubilee Field Unitization’’) and an increase in the estimated gas
reserves to be used as fuel gas for operating the FPSO.
The following table sets forth the estimated future net revenues, excluding derivatives contracts,
from net proved reserves and the expected benchmark prices used in projecting net revenues at
December 31, 2013. All estimated future net revenues are attributable to projected production from the
Jubilee Field in Ghana. If we are unable to resolve issues related to continuous removal of associated
natural gas in large quantities from the Jubilee Field, and the production restraints caused thereby,
then the field’s future net revenues discussed herein will be adversely affected. See ‘‘Item 1A. Risk
Factors—Our inability to access appropriate equipment and infrastructure in a timely manner may
hinder our access to oil and natural gas markets or delay our oil and natural gas production.’’
Projected Net
Revenues
(in millions
except $/Bbl)
Future net revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Present value of future net revenues:
PV-10(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Future income tax expense (levied at a corporate parent and
intermediate subsidiary level) . . . . . . . . . . . . . . . . . . . . . . . . . . .
Discount of future income tax expense (levied at a corporate parent
and intermediate subsidiary level) at 10% per annum . . . . . . . . .
Standardized Measure(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 2,836
.
$ 2,237
.
—
.
.
—
$ 2,237
Benchmark and differential oil price($/Bbl)(3) . . . . . . . . . . . . . . . . . . .
$108.76
(1) PV-10 represents the present value of estimated future revenues to be generated from the
production of proved oil and natural gas reserves, net of future development and
production costs, royalties, additional oil entitlements and future tax expense levied at an
asset level (in our case, future Ghanaian tax expense levied under the WCTP and DT
PAs), using prices based on an average of the first-day-of-the-months throughout 2013
and costs as of the date of estimation without future escalation, without giving effect to
hedging activities, non-property related expenses such as general and administrative
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