SHAMARAN PETROLEUM CORP. 2000 ‐ 885 West Georgia Street
Vancouver, B.C., V6C 3E8 Canada
Tel: (604) 689‐7842
Fax: (604) 689‐4250
ANNUAL INFORMATION FORM
For the year ended December 31, 2022
Dated: May 1, 2023
TABLE OF CONTENTS | |
Page No. | |
Glossary of Terms | 2 |
Currency | 4 |
Accounting Policies and Financial Information | 5 |
Conversion Table | 5 |
Abbreviations | 5 |
Reader Advisory Regarding Forward Looking Information | 5 |
Presentation of Oil and Gas Information | 7 |
ITEM 1 ‐ INTRODUCTION | 8 |
ITEM 2 ‐ CORPORATE STRUCTURE | 8 |
ITEM 3 ‐ GENERAL DEVELOPMENT OF THE BUSINESS | 9 |
ITEM 4 ‐ DESCRIPTION OF THE BUSINESS | 13 |
Overview of Industry Conditions in Kurdistan | 17 |
Risk Factors | 26 |
Statement of Reserves Data and Other Oil and Gas Information | 35 |
ITEM 5 ‐ DESCRIPTION OF CAPITAL STRUCTURE AND DIVIDENDS | 38 |
ITEM 6 ‐ MARKET FOR SECURITIES | 39 |
ITEM 7. ESCROWED SECURITIES AND SECURITIES SUBJECT TO CONTRACTUAL RESTRICTION ON | |
TRANSFER | 39 |
ITEM 8 ‐ DIRECTORS AND OFFICERS | 39 |
ITEM 9 ‐ LEGAL PROCEEDINGS AND REGULATORY ACTIONS | 44 |
ITEM 10 ‐ AUDIT COMMITTEE | 40 |
ITEM 11 ‐ INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS | 46 |
ITEM 12 ‐ REGISTRAR AND TRANSFER AGENT | 46 |
ITEM 13 ‐ MATERIAL CONTRACTS | 46 |
ITEM 14 ‐ NAMES AND INTERESTS OF EXPERTS | 47 |
ITEM 15 ‐ ADDITIONAL INFORMATION | 47 |
SCHEDULE A - Form 51‐101 F1 Statement of Reserves Data and Other Oil and Gas Information
SCHEDULE B - Form 51‐101 F2 Report on Reserves Data by Independent Qualified Reserves Evaluator or Auditor SCHEDULE C - Form 51‐101 F3 Report of Management and Directors on Reserves Data and Other Information SCHEDULE D - Form 51‐101 F4 Notice of Filing of 51‐101 F1 Information
SCHEDULE E ‐ Audit Committee Charter
Glossary of Terms
"2D" means two dimensional.
"3D" means three dimensional.
"2023 Bond Terms" means the agreement between ShaMaran and Nordic Trustee AS entered into on July 3, 2018, and as amended February 25, 2019 and further amended July 5, 2020 and January 29, 2021, in its capacity as trustee for the bondholders, describing the rights and obligations associated with the senior bonds issued by ShaMaran on July 5, 2018 and which were originally scheduled to mature on July 5, 2023 (the "2023 Bond") but have been merged into the 2025 Bond.
"2025 Bond Terms" means the agreement between ShaMaran and Nordic Trustee AS entered into on July 30, 2021 and describing the rights and obligations associated with the senior bonds issued by ShaMaran on July 30, 2021 and which mature on July 30, 2025 and the conversion of the 2023 Bond into such bond as certain conditions have been satisfied (the "2025 Bond").
"AIF" or "Annual Information Form" means this Annual Information Form prepared for the year ended December 31, 2022 and dated May 1, 2023.
"°API" means API gravity, a measure of the gravity of oil as defined by the American Petroleum Institute.
"Atrush Block" means the area covered by the Atrush Block PSC.
"Atrush Block PSC" means the Production Sharing Contract in respect of the Atrush Block, the KRG entered into with GEP dated November 10, 2007 and as further amended by the (i) first amendment dated August 1, 2010, (ii) second amendment dated October 20, 2010, (iii) third amendment dated December 31, 2012, (iv) fourth amendment dated November 7, 2016, and (v) fifth amendment dated May 31, 2019.
"Atrush Commercial Discovery" has the meaning assigned to it in the Atrush Block PSC, generally a discovery that is potentially commercial when considering all technical, operational, commercial and financial factors, all in accordance with prudent international petroleum industry practices.
"Atrush Contractor Group" means the parties from time to time that hold a participating interest in the Atrush Block PSC.
"Atrush Lifting Agreement" means the Lifting Agreement dated September 18, 2017 between the KRG and TAQA on behalf of itself and GEP for the sale of Atrush oil production to the KRG as such agreement has been amended and extended and expired at August 31, 2022 but at the date of this AIF negotiations on an amendment are continuing with the KRG.
"Bond Trustee" means Nordic Trust AS as bond trustee for the ShaMaran Bonds.
"Business Code" means the Code of Business Conduct and Ethics adopted by the Company on August 24, 2007 as subsequently amended and is in effect as at the date of this AIF.
"COGE Handbook" means the Canadian Oil and Gas Evaluation Handbook prepared jointly by The Society of Petroleum Evaluation Engineers (Calgary Chapter) and the Canadian Institute of Mining, Metallurgy & Petroleum (Petroleum Society), as amended from time to time.
"Common Shares" means the common shares in the capital of ShaMaran.
ShaMaran Petroleum Corp.
Annual Information Form
Dated May 1, 2023
Page 2
"Company" or "ShaMaran" means ShaMaran Petroleum Corp. and, as the context may indicate, its subsidiaries.
"Constitution of Iraq" means the permanent constitution of Iraq approved by the people of Iraq in the general referendum of October 15, 2005.
"crude oil" means a mixture that consists mainly of pentanes and heavier hydrocarbons, which may contain sulphur and other non‐hydrocarbon compounds, that is recoverable at a well from an underground reservoir and that is liquid at the conditions under which its volume is measured or estimated. It does not include solution gas or natural gas liquids.
"development well" means a well drilled inside the established limits of an oil or gas reservoir, or near the edge of the reservoir, to the depth of a stratigraphic horizon known to be productive.
"GEP" means General Exploration Partners, Inc., a wholly‐owned subsidiary of the Company, existing under the laws of the Cayman Islands.
"HKN" means HKN Energy Ltd., Operator of the Sarsang Block.
"km" means kilometers.
"KRG" means The Kurdistan Regional Government of Iraq.
"Kurdistan" or "Kurdistan Region" means the Federal Region of Kurdistan recognized by the Constitution of Iraq and having the same meaning as "Region" in the Oil and Gas Law of The Kurdistan Region ‐ Iraq (Law No. 22 of 2007).
"MOKDV" means Marathon Oil KDV B.V.
"MD&A" means Management's Discussion and Analysis of results of operations and financial condition of the Company for the year ended December 31, 2022.
"MENA" means Middle East and North Africa.
"MNR" means the Ministry of Natural Resources of the KRG.
"natural gas" means a mixture of lighter hydrocarbons that exist either in the gaseous phase or in solution in crude oil in reservoirs but are gaseous at atmospheric conditions. Natural gas may contain sulphur or other non‐ hydrocarbon compounds.
"NI 51‐101" means National Instrument 51‐101 - Standards of Disclosure for Oil and Gas Activities of the Canadian Securities Administrators.
"Oil and Gas Law" means the Oil and Gas Law of the Kurdistan Region ‐ Iraq (Law No. 22 of 2007).
"petroleum" means (i) any naturally occurring hydrocarbons in gaseous or liquid state; (ii) any mixture of naturally occurring hydrocarbons in a gaseous or liquid state; or (iii) any petroleum (as defined in (i) or (ii) herein) that has been returned to a reservoir.
"prospect" means a geographic or stratigraphic area in which the Company owns or intends to own one or more oil and gas interests, which is geographically defined based on geological data and which is reasonably anticipated to contain at least one reservoir or part of a reservoir of oil and gas.
ShaMaran Petroleum Corp.
Annual Information Form
Dated May 1, 2023
Page 3
"PSC", or "Production Sharing Contract" means contracts or agreements entered with a host government providing for petroleum operations in a defined area and the division of petroleum production from the petroleum operations.
"PVT" means pressure volume temperature.
"reservoir" means a subsurface rock formation containing an individual and separate natural accumulation of producible petroleum characterized by a single natural pressure system.
"Sarsang Block" means the area covered by the Sarsang Block PSC.
"Sarsang Block PSC" means the Production Sharing Contract in respect of the Sarsang Block, the KRG entered into between the KRG and HKN dated November 7, 2007 and as further amended by the (i) first amendment dated August 1, 2010, (ii) the second amendment dated October 20, 2010, (iii) the third amendment dated April 22, 2014, (iv) the fourth amendment dated April 24, 2014, and (v) the fifth amendment dated May 31, 2018.
"Sarsang Commercial Discovery" has the meaning assigned to it in the Sarsang Block PSC, generally a discovery that is potentially commercial when considering all technical, operational, commercial and financial factors, all in accordance with prudent international petroleum industry practices.
"Sarsang Contractor Group" means the parties from time to time that hold a participating interest in the Sarsang Block PSC.
"Sarsang Lifting Agreement" means the Lifting Agreement as amended effective as of September 1, 2022 between the KRG and HKN on behalf of itself and SNM Sarsang for the sale of Sarsang oil production to the and is currently in effect as at the date of this AIF.
"SEDAR" means the Canadian Securities Administrator's System for Electronic Document Analysis and Retrieval.
"ShaMaran Bond Guarantors" as at the date of this AIF are certain subsidiaries of the Company being ShaMaran Services SA, GEP, SNM Sarsang and 0781756 B.C. Ltd.
"SNM Sarsang" means ShaMaran Sarsang AS, a wholly‐owned subsidiary of the Company and existing under the laws of Denmark.
"TAQA" mean TAQA Atrush B.V., Operator of the Atrush Block, and a wholly‐owned subsidiary of the Abu Dhabi National Energy Company PJSC.
"TSX.V" means the TSX Venture Exchange.
"TVD" means true vertical depth.
Currency
The Company reports its financial results and prepares its financial statements in United States dollars ("USD"). All currency amounts indicated as "$" in this AIF are expressed in USD unless otherwise indicated. "CAD" means Canadian dollars.
Year Ended December 31 | ||||
Bank of Canada Exchange Rate | 2020 | 2021 | 2022 | |
for CAD/USD | 0.7854 | 0.7888 | 0.7383 |
ShaMaran Petroleum Corp.
Annual Information Form
Dated May 1, 2023
Page 4
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Disclaimer
ShaMaran Petroleum Corp. published this content on 02 May 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 May 2023 12:52:04 UTC.
