On a volumetric basis the Company's proved plus probable reserves (2P) and proved plus probable plus possible reserves (3P) increased due primarily to the Goksu and Bahar discoveries on our Molla licenses.
TransAtlantic expects to conduct a midyear reserve evaluation to update performance from the Company's activity during the first six months of 2013, including expected horizontal completions in southeastern Turkey in the Bedinan formation and additional horizontal Mardin formation completions.
The following is a summary of the Company's estimated net proved, probable, and possible reserves at December 31, 2012 and December 31, 2011:
|Reserves at December 31, 2012||Proved Developed||Total Proved||Proved+ Probable||Proved+ Probable+ Possible|
|Oil and Condensate, Mbbls||5,132||9,501||17,449||32,682|
|Natural Gas, MMcf||8,115||12,463||24,608||128,855|
|Total Oil and Natural Gas, Mboe (1)||6,484||11,578||21,551||54,158|
|PV-10 (2), $MMs||$309.0||$511.1||$962.2||$2,042.4|
|Reserves at December 31, 2011||Proved Developed||Total Proved||Proved+ Probable||Proved+ Probable+ Possible|
|Oil and Condensate, Mbbls||5,373||11,215||16,016||27,672|
|Natural Gas, MMcf||10,520||13,223||25,892||131,118|
|Total Oil and Natural Gas, Mboe (1)||7,126||13,419||20,331||49,525|
|PV-10 (2), $MMs||$344.0||$645.8||$925.6||$1,751.6|
(1) Mboe is not included in the DeGolyer and MacNaughton reserve report and was derived by the Company by converting natural gas to oil in the ratio of six Mcf of natural gas to one bbl of oil. A boe conversion ratio of six Mcf to one bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. PV-10 was calculated using an overall weighted average price of $108.30 per bbl and $8.94 per Mcf.(2) The total proved PV-10 value of the estimated future net revenue are not intended to represent the current market value of the estimated oil and natural gas reserves we own. Management believes that the presentation of PV-10, while not a financial measure in accordance with generally accepted accounting principles in the United States ("GAAP"), provides useful information to investors because it is widely used by professional analysts and sophisticated investors in evaluating oil and natural gas companies. Because many factors that are unique to each individual company impact the amount of future income taxes estimated to be paid, the use of a pre-tax measure is valuable when comparing companies based on reserves. PV-10 is not a measure of financial or operating performance under GAAP. PV-10 should not be considered as an alternative to the standardized measure as defined under GAAP. PV-10 of probable or possible reserves represent the present value of estimated future revenues to be generated from the production of probable or possible reserves, calculated net of estimated lease operating expenses, production taxes and future development costs, using costs as of the date of estimation without future escalation and using 12-month average prices, without giving effect to non-property related expenses such as general and administrative expenses, debt service, and depreciation, depletion, and amortization, or future income taxes and discounted using an annual discount rate of 10%. With respect to pre-tax PV-10 amounts for probable or possible reserves, there do not exist any directly comparable US GAAP measures, and such amounts do not purport to present the fair value of our probable and possible reserves. The following table provides a reconciliation of our Total Proved Reserves (1P) PV10 to our standardized measure: