Following this announcement, shares in Elk soared 127% to close last week at 42c each. This morning, ELK was trading higher still at 61c.

Elk said the reserve calculation figure was derived from preliminary results into tertiary oil recovery from the historic field, undertaken by the University of Wyoming’s Enhanced Oil Recovery Institute (EORI).

Elk said it had contracted Ryder Scott to review the EORI’s work and use its recovery forecast to certify and classify the reserves.

The company calculated that should 23MMboe be extracted from the field, this would represent a 71.1% recovery rate from the Grieve Muddy reservoir, with 30.8% being achieved from the carbon dioxide flood.

Elk engaged the EORI earlier this year to develop a reservoir model to simulate a gravity stable carbon dioxide flood of the Grieve Muddy reservoir.

“Because of the long producing history in the Grieve field, a very good history match of actual production to reservoir pressures throughout the life of the field was able to be achieved,” Elk said.

“This has given both the EORI and Elk considerable confidence in the model.”

Looking ahead, Elk said it planned to further refine and optimise the carbon dioxide flood to determine the most inexpensive and effective production configuration.

The EORI is expected to supply a final report on this study this quarter.

Elk said it was in negotiations with several parties about getting carbon dioxide supplies for this project.