TransGlobe Energy Corporation Announces 2013 Year-End Reserves, Operations Update and Conference Call

TransGlobe Energy Corporation Announces 2013 Year-End Reserves, Operations 
Update and Conference Call 
CALGARY, ALBERTA -- (Marketwired) -- 01/28/14 -- TransGlobe Energy
Corporation (TSX:TGL)(NASDAQ:TGA) ("TransGlobe" or the "Company")
today announces its 2013 year-end reserves and operations update
before the opening of stock markets. All dollar values are expressed
in United States dollars unless otherwise stated. A conference call
and webcast to discuss reserves will be held the same day: 

Time:          7:30 a.m. Mountain Time (9:30 a.m. Eastern Time)             
Dial-in:       (416) 340-2216 or toll-free at 1-866-226-1792                

The Company's 2013 and 2012 year-end reserves were prepared by the
independent reserves evaluation firm of DeGolyer and MacNaughton
Canada Limited ("DeGolyer"), in accordance with National Instrument
The following is a summary of DeGolyer's evaluation for the year
ended December 31, 2013 with comparatives to the year ended December
31, 2012. The recovery and reserve estimates of crude oil, natural
gas liquids ("NGLs") and natural gas reserves provided in this news
release are estimates only, and there is no guarantee that the
estimated reserves will be recovered. Actual crude oil, NGL and
natural gas reserves may be greater than, or less than, the estimates
provided herein. All reserves presented are based on DeGolyer's
forecast pricing, effective December 31, 2013 and December 31, 2012,

Year-End Reserves Summary(i)
(Working Interest, before Royalties)
                      Dec. 31 Dec. 31 Dec. 31 Dec. 31   Increase   Increase
                         2013    2013    2012    2012  (Decrease) (Decrease)
                       (MMBbl) (MMBbl) (MMBbl) (MMBbl)        (%)        (%)
Oil Reserves            Gross  Net(ii)  Gross  Net(ii)     Gross     Net(ii)
Proved ("1P")                                                              
Egypt                    28.8    14.6    29.8    14.0        (3%)        5%
Yemen                     2.8     1.5     3.0     1.6        (6%)       (7%)
Total 1P                 31.6    16.2    32.8    15.6        (3%)        3%
Proved Plus                                                                
Probable ("2P")                                                            
Egypt                    40.8    20.1    43.9    19.9        (7%)        1%
Yemen                     4.5     2.4     4.9     2.6        (8%)       (7%)
Total 2P                 45.3    22.5    48.7    22.5        (7%)        0%
Plus Probable                                                              
Plus Possible ("3P")                                                       
Egypt                    49.7    24.0    56.5    24.7       (12%)       (3%)
Yemen                     5.6     3.1     5.9     3.2        (5%)       (4%)
Total 3P                 55.3    27.1    62.4    27.9       (11%)       (3%)
(i) Numbers may not add exactly due to rounding.                           
(ii) Net reserves are after royalties before tax.                          

Definitions of Reserves Categories: 

--  Proved reserves are those reserves that can be estimated with a high
    degree of certainty to be recoverable. It is likely that the actual
    remaining quantities recovered will exceed the estimated proved
--  Probable reserves are those additional reserves that are less certain to
    be recovered than proved reserves. It is equally likely that the actual
    remaining quantities recovered will be greater or less than the sum of
    the estimated proved plus probable reserves. 
--  Possible reserves have a less likely chance of being recovered than
    probable reserves. This term is often used for reserves which are
    claimed to have at least a 10 percent certainty of being produced. 

2013 Reserve Changes 
In 2013, the Company's activities focused primarily on the continued
development of its operated West Gharib and West Bakr (acquired at
the end of 2011) concessions in the Arab Republic of Egypt ("Egypt"). 
In Egypt, the Company's 1P reserves fell 3 percent from 2012,
representing a production replacement of 85 percent. On a 2P basis,
the year-over-year decrease was 7 percent, equal to a production
replacement of 53 percent, while on a 3P basis, the year-over-year
decrease was 12 percent, equal to a production replacement of minus 4
At West Gharib, year-end 2012 undeveloped reserve bookings were
brought on production throughout 2013 which generally extended
producing pools to the boundaries of the West Gharib lands. As a
result, there were minimal new reserve additions to replace the 4.6
million barrels produced from West Gharib during 2013. 
At West Bakr, significant reserve additions were achieved in the K
and H fields due to detailed reservoir simulation, development
drilling and production optimization. Overall, 2P reserves at West
Bakr increased 22% on a year over year basis which represented a 268%
replacement of the 1.8 million barrels produced from West Bakr during
East Ghazalat reserves were down year over year due to the 2013
appraisal drilling results and the corresponding decrease in the
number of undeveloped drilling locations. 
In the Republic of Yemen ("Yemen"), reserves were reduced primarily
due to production and reduced field activity associated with labor
unrest in the country. 
Estimated Future Net Revenues 
All evaluations and reviews of future net cash flows are stated prior
to any provision for interest costs or general and administrative
costs, and after the deduction of estimated future capital
expenditures for wells, to which reserves have been assigned. It
should not be assumed that the estimated future net cash flow shown
below is representative of the fair market value of the Company's
properties. There is no assurance that such price and cost
assumptions will be attained, and variances could be material. The
recovery and reserve estimates of crude oil, NGL and natural gas
reserves provided herein are estimates only, and there is no
guarantee that the estimated reserves will be recovered. Actual crude
oil, NGL and natural gas reserves may be greater than or less than
the estimates provided herein. 
The estimated future net revenues for years ended 2013 and 2012
presented below in millions of U.S. dollars ("$MM"), are calculated
using DeGolyer's price forecast at December 31, 2013 and December 31,
2012, respectively, and constant pricing using the Securities and
Exchange Commissions' ("SEC") average price (the 12-month average
price using the first day of the month prices during 2013 and 2012,
respectively). In the constant price cases, the prices were held
constant for the life of the reserves. 
Forecast Pricing 

          Present Value of Future Net Revenues, After Tax ($MM)(i)         
                   Independent Evaluator's Price Forecast                  
                           December 31, 2013          December 31, 2012    
Present Value                Discounted at              Discounted at      
By Area                 0%   5%  10%  15%  20%     0%     5%  10%  15%  20%
  Egypt               $606 $515 $449 $400 $361   $718   $596 $513 $453 $408
  Yemen                $56  $51  $46  $42  $39    $64    $56  $50  $45  $41
Total 1P              $663 $566 $495 $442 $400   $782   $653 $563 $498 $449
Proved plus                                                                
  Egypt               $789 $648 $549 $478 $424   $960   $768 $642 $553 $489
  Yemen                $87  $75  $65  $58  $52   $100    $83  $71  $61  $54
Total 2P              $876 $722 $615 $536 $476 $1,060   $851 $712 $615 $543
Proved plus                                                                
 Probable plus                                                             
  Egypt               $939 $752 $626 $537 $471 $1,171   $933 $775 $664 $581
  Yemen               $113  $92  $78  $67  $59   $126   $102  $84  $72  $63
Total 3P            $1,052 $844 $704 $605 $531 $1,297 $1,035 $860 $736 $644
(i) Numbers may not add exactly due to rounding.                           

The following table summarizes DeGolyer's reference price forecast
used to estimate future net revenues: 

DeGolyer Forecast Pricing ($/Bbl)                                          
Brent Forecast Pricing ($/Bbl)         2014    2015    2016    2017    2018
Year-end 2013                       $106.00 $101.80 $101.64 $101.51 $101.42
Year-end 2012                       $108.35 $105.72 $107.88 $106.62 $107.10

Constant Pricing 

          Present Value of Future Net Revenues, After Tax ($MM)(i)         
                              Constant Pricing                             
                           December 31, 2013          December 31, 2012    
Present Value                Discounted at              Discounted at      
By Area                 0%   5%  10%  15%  20%     0%     5%  10%  15%  20%
  Egypt               $640 $543 $474 $421 $380   $731   $610 $526 $465 $419
  Yemen                $61  $54  $49  $44  $41    $66    $58  $52  $47  $43
Total 1P              $701 $597 $522 $465 $421   $797   $668 $578 $511 $461
Proved plus                                                                
  Egypt               $825 $680 $578 $503 $446   $970   $782 $656 $568 $502
  Yemen                $95  $80  $69  $61  $55   $104    $86  $73  $63  $56
Total 2P              $920 $760 $647 $564 $501 $1,074   $867 $729 $631 $557
Proved plus                                                                
 Probable plus                                                             
  Egypt               $978 $787 $658 $566 $497 $1,186   $951 $793 $681 $597
  Yemen               $122  $99  $84  $72  $64   $133   $107  $88  $75  $66
Total 3P            $1,100 $887 $742 $638 $560 $1,319 $1,058 $881 $756 $663
(i) Numbers may not add exactly due to rounding.                           

The Constant Pricing used to estimate future net revenues is as
follows, with Egypt prices based on prices received for West Gharib,
West Bakr and East Ghazalat production and Yemen prices based on
prices received for production from Blocks 32 and S-1. 
Pursuant to the SEC pronouncement in 2009, the Constant Price cases
are based on the average of the reference price received on the first
of each month during the year adjusted for respective differentials
at year-end. 

Constant Pricing ($/Bbl)                      2013                     2012
Egypt                                       $93.17                  $102.60
Yemen                                      $106.07                  $108.41

The following table summarizes Company production for October,
November, December of 2013 and January month to date ("MTD") in 2014,
in addition to the estimated production average for the year 2013.
Production numbers will differ from sales numbers primarily due to
the timing of lifting's in Yemen. 

                                                       Full Year       2014
                        2013 Monthly Production (Bopd)      2013   Month-to-
Concession              October   November   December    Average       Date
West Gharib              11,998     11,892     12,023     12,511     11,700
West Bakr                 5,992      5,509      5,207      5,065      5,900
East Ghazalat               216        367        419        316        380
Egypt Totals             18,206     17,768     17,649     17,893     17,980
Block S-1                     0        959        276        102        770
Block 32                    303        294        230        308        250
Yemen Totals                303      1,253        506        410      1,020
TransGlobe Totals        18,509     19,021     18,155     18,303     19,000

West Gharib production has been in the 12,000 Bopd range for the past
4 months. Well stimulations and completions have been ongoing however
production increases have been offset by natural declines and well
servicing. An additional 6 wells are scheduled for completions and/or
stimulations during the first quarter. 
West Bakr production declined from 6,000 Bopd in October, to 5,500
Bopd in November and 5,200 Bopd in December due to a number of pump
changes and workovers along with service rig mechanical issues that
hampered well servicing efficiency. An additional service rig was
contracted on a short-term basis in order to alleviate the servicing
back-log in November/December and boost overall production. January
production has increased to average 5,900 Bopd MTD primarily due to
new wells and an active workover program in December. 
Yemen Block S1 production was restarted in November following
extensive labor negotiations throughout 2013. Subsequently Block S1
was shut in for a portion of December and January due to disruptions
on the export pipeline which has been repaired. Block 32 production
has also been impacted by local tribal issues and sporadic
disruptions on the Masila export pipeline to the Indian Ocean during
December and January. 
Subsequent to the Mid Q4 update (December 9, 2013) the Company has
drilled five wells resulting in three oil wells, one water injector
and one dry hole. 
At West Gharib (100% working interest) the Company drilled a Lower
Nukhul oil well at Arta (waiting completion) and a water injector at
Hana to optimize the Hana water flood. The rig is currently drilling
a Lower Nukhul development well at Arta and is scheduled to drill up
to nine wells in West Gharib during Q1 and Q2 of 2014 prior to moving
to the new North West Gharib ("NWG") concession for the remainder of
At West Bakr (100% working interest), the Company drilled oil wells
in H and K fields. The H field well encountered two oil zones and was
completed and is currently producing approximately 300 Bopd from the
lower-most zone. The K field well encountered oil in three zones (Asl
A, B & E) and is scheduled for completion in the Asl E formation. The
drilling rig is currently drilling in K field and is scheduled to
continue working in West Bakr with 17 wells planned for 2014. 
At South Alamein (100% working interest), the Company drilled and
abandoned the West Manar exploration well. West Manar was drilled to
a total depth of 7,300 feet and cost approximately $1.9 million to
drill and abandon, and the rig was subsequently released. This
concession remains a high-potential exploration area for the Company
however future exploration drilling is dependent on receiving the
necessary military approvals to access the broader Boraq area of the
At East Ghazalat (50% working interest, non-operated) drilling
commenced on a shallow (planned 4,400 feet) exploration well at East
Ghazalat #3. East Ghazalat #3 is located approximately 3 kilometers
east of the Safwa development lease and is targeting a new play, a
Cretaceous reef feature. Should this well be successful, it will
significantly de-risk this play and which could result in additional
drilling. A total of 14 drilling targets have been identified on the
existing 3D seismic data, which DeGolyer independently evaluated as
of December 31, 2012 and estimated the prospective resources in this
play type to contain 6 million barrels (gross unrisked) on a P-mean
basis. Following East Ghazalat #3, the drilling rig is scheduled to
drill two development wells in the Safwa field. 
New Exploration Blocks, Eastern & Western Desert (100% working
The Company has prepared and submitted an initial 18 wells for the
necessary approvals on the North West Gharib ("NWG") block in the
Eastern Desert. The Company has identified 79 drilling locations
based on existing 3D seismic and geological modeling of the area. The
Company is targeting the second quarter of 2014 to commence
exploration drilling at NWG. Based on current mapping the Company has
internally estimated a prospective resource of 71 million barrels on
an un-risked deterministic basis for the entire NWG block. The 2014
drilling program will target up to 58 million barrels of the total 71
million barrels of prospective resource identified to date. 
Based on surface and remote-sensing mapping, the same structural
configuration that created the pools found in the West Gharib
concession is likely present in the NWG, SW Gharib ("SWG") and SE
Gharib ("SEG") blocks. The historical field size distribution data
indicates that the average field size in the broader onshore Gulf of
Suez (Eastern Desert) area is roughly 20 million barrels per field of
recoverable resource. The Company has identified an additional 15
areas of interest ("leads") in the NWG block, 4 leads on the SWG
block and 2 leads on the SEG block that will be followed up and
further refined by field mapping and the high-resolution seismic
acquisition program. 
In the Western Desert, the South Ghazalat concession will be covered
by an 800 km2 seismic acquisition program during the initial
evaluation. This large block is situated on the western margin of the
prolific Abu Gharadig Basin, immediately west of the non-operated
East Ghazalat block, where a Jurassic gas-condensate discovery was
made and announced late in 2013. 
The total seismic program will consist of approximately 1,800 square
kilometers of 3D seismic and 300 kilometers of 2D seismic. Subject to
approvals and crew availability, the Company's target is to commence
acquisition in the Eastern Desert during Q2 of 2014. It is expected
the full program, providing broad coverage of the new concessions,
will be completed in early 2015. 
New EGPC Bid Round: EGPC has recently announced a new bid round which
offers 15 blocks across Egypt. The company plans to evaluate the
offered blocks. As a result, the Company may bid on several new
exploration blocks that would augment the recently acquired approx.
800,000 acres of exploration acreage. 
The Company collected $275.2 million from EGPC in 2013, which
includes collections of $127.4 million during the fourth quarter
which consisted of a full and partial cargo lifting, offsets
(including the signature bonuses on new concessions) and cash
payments. At year-end 2013, the total receivable had been reduced to
approximately $148 million (net of excess cost oil of approx. 17
million) which represents a 25% reduction in total receivables year
over year. In addition the average aging of the receivables has
reduced to the 6-7 month range from the 8-10 month range year over
TransGlobe Energy Corporation is a Calgary-based, growth-oriented oil
and gas exploration and development company focused on the Middle
East/North Africa region with production operations in the Arab
Republic of Egypt and the Republic of Yemen. TransGlobe's common
shares trade on the Toronto Stock Exchange under the symbol TGL and
on the NASDAQ Exchange under the symbol TGA. TransGlobe's Convertible
Debentures trade on the Toronto Stock Exchange under the symbol
This news release may include certain statements that may be deemed
to be "forward-looking statements" within the meaning of the U.S.
Private Securities Litigation Reform Act of 1995. Such statements
relate to possible future events. All statements other than
statements of historical fact may be forward-looking statements.
Forward-looking statements are often, but not always, identified by
the use of words such as "seek", "anticipate", "plan", "continue",
"estimate", "expect", "may", "will", "project", "predict",
"potential", "targeting", "intend", "could", "might", "should",
"believe" and similar expressions. Statements relating to "resources"
are forward-looking statements as they involve the implied
assessment, based on estimates and assumptions that the resources
described exist in the quantities predicted or estimated. These
statements involve known and unknown risks, uncertainties and other
factors that may cause actual results or events to differ materially
from those anticipated in such forward-looking statements. Although
TransGlobe's forward-looking statements are based on the beliefs,
expectations, opinions and assumptions of the Company's management on
the date the statements are made, such statements are inherently
uncertain and provide no guarantee of future performance. Actual
results may differ materially from TransGlobe's expectations as
reflected in such forward-looking statements as a result of various
factors, many of which are beyond the control of the Company. These
factors include, but are not limited to, unforeseen changes in the
rate of production from TransGlobe's oil and gas properties, changes
in price of crude oil and natural gas, adverse technical factors
associated with exploration, development, production or
transportation of TransGlobe's crude oil and natural gas reserves,
changes or disruptions in the political or fiscal regimes in
TransGlobe's areas of activity, changes in tax, energy or other laws
or regulations, changes in significant capital expenditures, delays
or disruptions in production due to shortages of skilled manpower,
equipment or materials, economic fluctuations, upon completion of the
primary term of any current exploration and/or production license,
TransGlobe would secure an extension or additional license for any
accumulation or discovered prospect; that TransGlobe intends to
proceed with development and operation of any commercially viable
discovered prospect, and other factors beyond the Company's control.
TransGlobe does not assume any obligation to update forward-looking
statements if circumstances or management's beliefs, expectations or
opinions should change, other than as required by law, and investors
should not attribute undue certainty to, or place undue reliance on,
any forward-looking statements. Please consult TransGlobe's public
filings at and for further,
more detailed information concerning these matters.
TransGlobe Energy Corporation
Steve Langmaid
Investor Relations
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