Production
During the fiscal 2008 second quarter, net gas sales volume increased 73 percent to 64.5 million cubic feet from 37.4 million cubic feet in last year's comparable quarter. On a sequential basis, net gas sales increased 13 percent versus the current fiscal year's first quarter. For the first six months of fiscal 2008, BPI reported net gas sales of 121.3 million cubic feet - up 37 percent from the first half of fiscal 2007.
Reserves
BPI Energy announced proved reserves of 14.7 Bcf for the fiscal year ended July 31, 2006. This represents a 43 percent increase from the previous year-end. The proved reserves, all located in the Company's Southern Illinois Basin Project, are 100 percent natural gas and 32 percent proved developed producing, 29 percent proved developed non-producing and 39 percent proved undeveloped. The pre-tax present value of the proved reserves, discounted at 10 percent, is $35.4 million using the July 31 Henry Hub spot gas price of $8.05 per million British thermal units (MMBtu) of natural gas, adjusted for geographic and quality differences. The proved reserve evaluation conforms to the Securities and Exchange Commission Regulation S-X, Rule 4-10 (a).
BPI's proved reserves reside on acreage representing less than two percent of its net acreage position. With approximately 500,000 net acres under lease, the Company reports probable reserves of 3.2 Bcf and possible reserves of 749.4 Bcf for total proved, probable and possible (3P) reserves of 767.3 Bcf. The Securities and Exchange Commission does not recognize possible and probable reserves. The probable and possible components of reserves are comprised of 538.7 Bcf of possible reserves located in the Company's Northern Illinois Basin Project, 209.2 Bcf of possible reserves located in the Company's Western Illinois Basin Project, and 1.5 Bcf of probable reserves located in the Company's Southern Basin Project. The reserve report was prepared by the Company's independent reservoir engineering firm.