These royalty interest lands are significant to Freehold. The majority of these lands are leased to third party operators. As a royalty owner, we have no operational control over the operator's future development activities. As such, the extent of drilling and development activity in future years can be difficult to predict. However, these operators have historically invested significant amounts to generate future reserve additions, and production from which Freehold receives certain royalties. Reserve values do not include potential reserve additions that may occur as a result of future drilling on most of our royalty lands. In addition, based on an internal estimate, we have estimated the net present value of the future royalty revenue from our potash reserves at $20.7 million before tax (discounted at 10%).
Our oil and gas reserves were independently evaluated by Trimble Engineering Associates Ltd. (Trimble) as at December 31, 2012. The evaluation was conducted in accordance with the standards contained in the COGE Handbook and the reserve definitions contained in National Instrument 51-101. Our Reserves Committee met with Trimble to review the findings and procedures, and the reserves report has been accepted by our Board.
Summary oil and gas reserves information is provided below. Complete reserves disclosure as required under National Instrument 51-101 will be included in our Annual Information Form.
Summary of Oil and Gas ReservesAs of December 31, 2012Forecast Prices and Light and Medium Costs (1) Oil Heavy Oil Total Crude Oil -------------------------------------------------------- Gross (2) Net (3) Gross (2) Net (3) Gross (2) Net (3)Reserves Category (Mbbls) (Mbbls) (Mbbls) (Mbbls) (Mbbls) (Mbbls)----------------------------------------------------------------------------Proved Developed producing 1,754 3,490 827 4,150 2,581 7,640 Developed non- producing 73 64 - 6 73 70 Undeveloped - - 28 23 28 23----------------------------------------------------------------------------Total proved 1,826 3,554 856 4,178 2,682 7,733Probable 1,346 2,301 916 3,197 2,262 5,498----------------------------------------------------------------------------Total proved plus probable 3,173 5,855 1,771 7,376 4,944 13,231---------------------------------------------------------------------------- Natural Gas Natural Gas Liquids Oil Equivalent -------------------------------------------------------- Gross (2) Net (3) Gross (2) Net (3) Gross (2) Net (3)Reserves Category (MMcf) (MMcf) (Mbbls) (Mbbls) (Mboe) (Mboe)----------------------------------------------------------------------------Proved Developed producing 4,024 33,628 146 841 3,398 14,085 Developed non- producing 59 794 7 7 90 209 Undeveloped - 4,314 - 46 28 788----------------------------------------------------------------------------Total proved 4,083 38,736 154 893 3,516 15,082Probable 3,042 20,212 124 476 2,893 9,343----------------------------------------------------------------------------Total proved plus probable 7,125 58,949 277 1,369 6,409 24,425--------------------------------------------------------------------------------------------------------------------------------------------------------(1) Numbers may not add due to rounding.(2) Gross reserves are our share of working interest properties before deduction of royalties payable to others. Gross reserves exclude royalty interests.(3) Net reserves are defined as our share of working interest properties minus royalties payable to others, plus royalties receivable on our royalty lands.
