ROK Resources (ROK) Update - April 20

[dan_s]

ROK Resources Announces Proforma Reserves and Drilling Inventory Growth

REGINA, SK / ACCESSWIRE / April 20, 2023 / ROK Resources Inc. ("ROK" or the "Company") (TSXV:ROK) is pleased to announce the results of its April 1, 2023 independent reserves evaluation (the “Evaluation”), which was conducted by McDaniel & Associates (“McDaniel”) of Calgary and was conducted in accordance with the definitions, standards and procedures contained in the Canadian Oil and Gas Evaluators Handbook (“COGEH”) and National Instrument 51-101 - Standards for Disclosure of Oil and Gas Activities ("NI 51-101"). The reserve volumes are inclusive of the Company’s recent divestitures and acquisitions and represent corporate reserve volumes as of April 1, 2023.

Reserves Highlights

> ROK’s Evaluation is highlighted by the addition of 3.2 million Boe of Proved oil and gas reserves (“1P”), to a total of 13 million Boe, a 34% increase when compared to December 31, 2022.
> The Company also added 5.4 million Boe of Proved plus probable oil and gas reserves (“2P”), to a total of 21.5 million Boe, a 35% increase compared to December 31, 2022.
> ROK has achieved this reserve growth while simultaneously reducing net debt from $35.4 million at year-end 2022, to an estimated $10 million at April 1, 2023. < At our April 18th luncheon they told us that they plan to pay off all remaining senior debt by the end of June with operating cash flow.

1P oil and gas reserves of 13,016 MBoe and Net Present Value of 1P reserves discounted at 10% of $135.2 million < $0.64Cdn/share
2P oil and gas reserves of 21,552 MBoe and Net Present Value of 2P reserves discounted at 10% of $257.8 million < $1.22Cdn/share
Total 1P NAV of $0.59/basic share and 2P NAV of $1.17/basic share, up 25% and 35% respectively from year-end 2022, despite a ~30% drop in 2023 AECO pricing and ~5% drop in 2023 WTI pricing
1P RLI of 9 years and 2P RLI of 15 years, representing a 16% increase to both 1P & 2P RLI
An increase in booked locations from 58 gross to 124 gross, up 114% from year-end 2022
Estimated future undiscounted development costs of $142 million (1P) and $194 million (2P), or $10.91 per 1P Boe and $9.00 per 2P Boe
--------------------------
ROK has a lot of "running room" in two of North America's top oil & gas plays. My current valuation is $1.00/share. You can find my forecast/valuation model on the EPG website under the Small-Cap tab.