2 0 AR 11
Review of Reserves ARC’s inventory of valuecreating opportunities continues to expand at a rapid pace. In 2011, ARC increased proved plus probable reserves by 18% to 572 mmboe and replaced 385 % of its annual production. Reserves Proved Plus Probable
Much of the growth was driven by the northeast British Columbia Montney region where proved plus probable reserves increased by 48 per cent to 1.9 tcf of natural gas and 21 mmbbls of natural gas liquids. An independent resources evaluation in the northeast British Columbia Montney assigned a best estimate of economic contingent resource of 4.1 tcf of natural gas and 101 mmbbls of liquids in excess of booked reserves, confirming ARC’s belief that there is considerable growth potential in the region.
600 500 400 300 200 100 0 Storm
NPCU / Redwater
Orion AnteCreek Startech
96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11
This growth was achieved at an all-in annual Finding, Development and Acquisition (“FD&A”) cost of $5.24 per boe excluding future development capital (“FDC”) for proved plus probable reserves. This brings ARC’s three year average FD&A cost excluding FDC down to $7.15 per boe. ARC’s low FD&A costs are a reflection of our focus on high quality assets, cost management and allocation of resources and capital to the highest rate of return projects. Recycle ratio is an important measure of profitability in the oil and gas industry as it identifies overall capital efficiency. ARC achieved a recycle ratio of 5.3 times excluding FDC for proved plus probable reserves based on a 2011 netback of $29.16 per boe.
The reserves data set forth below are stated on a company gross basis (working interest before deduction of royalties and without including any royalty interests) unless noted otherwise. All reserves information has been prepared in accordance with NI 51-101. In addition to the detailed information disclosed in this document more detailed reserves information is included in ARC’s Annual Information Form for the yearended December 31, 2011, which is available on our SEDAR profile at www.sedar.com. Numbers presented may not add due to rounding.