Legend Oil & Gas, Ltd. - FORM 8-K/A - EX-99.3 - ALBERTA, CANADA PROPERTIES EVALUATION OF RESERVES REPORT

Attached files

file	filename
8-K/A - FORM 8-K AMENDMENT NO. 1 - Legend Oil & Gas, Ltd.	d257113d8ka.htm
EX-21.1 - SUBSIDIARIES - Legend Oil & Gas, Ltd.	d257113dex211.htm
EX-99.4 - AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF INTERNATIONAL SOVEREIGN ENERGY CORP - Legend Oil & Gas, Ltd.	d257113dex994.htm
EX-23.3 - CONSENT OF PETERSON SULLIVAN LLP - Legend Oil & Gas, Ltd.	d257113dex233.htm
EX-23.4 - CONSENT OF ROBISON HILL & CO. - Legend Oil & Gas, Ltd.	d257113dex234.htm
EX-23.2 - CONSENT OF INSITE PETROLEUM CONSULTANTS LTD. - Legend Oil & Gas, Ltd.	d257113dex232.htm
EX-23.5 - CONSENT OF DELOITTE & TOUCHE LLP - Legend Oil & Gas, Ltd.	d257113dex235.htm
EX-23.1 - CONSENT OF KLH CONSULTING - Legend Oil & Gas, Ltd.	d257113dex231.htm
EX-10.19 - OFFICE SPACE LEASE BY AND BETWEEN DUNDEAL CANADA (GP) INC. - Legend Oil & Gas, Ltd.	d257113dex1019.htm
EX-10.10A - AMENDING AGREEMENT TO ASSET PURCHASE AGREEMENT - Legend Oil & Gas, Ltd.	d257113dex1010a.htm
EX-99.6 - UNAUDITED PRO FORMA FINANCIAL INFORMATION - Legend Oil & Gas, Ltd.	d257113dex996.htm
EX-99.5 - UNAUDITED CONDENSED INTERIM CONSOLIDATED STATEMENTS - Legend Oil & Gas, Ltd.	d257113dex995.htm

EXHIBIT 99.3

STATEMENT OF RESERVES DATA AND OTHER OIL AND GAS INFORMATION

INTERNATIONAL SOVEREIGN ENERGY CORP.

The following tables set forth certain information relating to the Company’s crude oil, natural gas and natural gas liquid reserves and the net present value of future net revenues associated with such reserves as at December 31, 2010, as evaluated by InSite Petroleum Consultants Ltd. (“InSite”) in the InSite Progress Report based upon forecast price and cost assumptions. The InSite Progress Report has been prepared in accordance with the standards contained in the COGE Handbook and the reserve definitions contained in CSA 51-324. InSite was engaged to provide an evaluation of all of the Company’s proved and proved plus probable reserves. Numbers in each column may not add due to rounding.

All future net revenues are stated prior to provision for interest, general and administrative expenses and after deduction of royalties and estimated future capital expenditures. Future net revenues have been presented on both a before and after tax basis.

It should not be assumed that the present worth of estimated future cash flow presented in the tables below represent the fair market value of the reserves. There is no assurance that the forecast prices and costs assumptions will be attained and variances could be material. The recovery and reserve estimates of ISR’s crude oil, natural gas liquids and natural gas reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual crude oil, natural gas and natural gas liquid reserves may be greater than or less than the estimates provided herein. Readers should review the definitions and information contained in “Natural Gas and Petroleum Reserves and Production Information” in conjunction with the following tables and notes.

Item 2.1 Reserves Data (Forecast Prices and Costs)

1.	Breakdown of Reserves (Forecast Case)

Summary of Oil and Gas Reserves

INTERNATIONAL SOVEREIGN ENERGY CORP.

Forecast Prices & Costs - InSite December 31, 2010 Prices


	Oil												Natural Gas				Natural Gas
	Light and Medium				Heavy				Solution				Assoc. & Non-Assoc.				Liquids				Total BOE
	Gross		Net		Gross		Net		Gross		Gross		Net		Net		Gross		Net		Gross		Net
Reserves Category	(MStb)		(MStb)		(MStb)		(MStb)		(MMcf)		(MMcf)		(MMcf)		(MMcf)		(MStb)		(MStb)		(MBoe)		(MBoe)
PDP		109.1		114.8		147.8		132.8		42.8		39.7		1870.4		1575.8		10.3		7.5		586.1		524.4
PDNP		0.0		0.0		0.0		0.0		0.0		0.0		37.4		30.8		0.0		0.0		6.2		5.1
PU		0.0		0.0		0.0		0.0		0.0		0.0		273.4		241.7		0.0		0.0		45.6		40.3
PD+PU		109.1		114.8		147.8		132.8		42.8		39.7		2181.2		1848.3		10.3		7.5		637.9		569.8
PA		58.5		54.4		115.5		97.1		30.2		28.1		2449.6		1998.5		16.8		12.8		604.1		502.2
P+PA		167.6		169.2		263.3		229.9		73.0		67.9		4630.9		3846.8		27.2		20.4		1242.1		1071.9

Page | 1

2.	Net Present Value of Future Net Revenue (Forecast Case)

Summary of Net Present Values of Future Net Revenue

INTERNATIONAL SOVEREIGN ENERGY CORP.

Forecast Prices & Costs - InSite December 31, 2010 Prices


	Before Income Taxes										Unit Value
Reserves Category	0% (M$)		5% (M$)		10% (M$)		15% (M$)		20% (M$)		10% ($/Boe)
Proved Developed Producing		18115.9		13440.5		10773.0		9059.8		7867.1		20.55
Proved Developed Non-Producing		9.7		10.0		10.1		10.2		10.2		1.97
Proved Undeveloped		980.4		656.2		449.5		314.4		224.0		11.16
Total Proved		19106.0		14106.7		11232.7		9384.4		8101.3		19.71
Probable Additional		14805.4		7869.7		4953.3		3425.4		2507.9		9.86
Total Proved + Probable		33911.3		21976.4		16186.0		12809.8		10609.2		15.1

	After Income Taxes (Tax Pools)
Reserves Category	0% (M$)		5% (M$)		10% (M$)		15% (M$)		20% (M$)
Proved Developed Producing		18115.9		13440.5		10773.0		9059.8		7867.1
Proved Developed Non-Producing		9.7		10.0		10.1		10.2		10.2
Proved Undeveloped		980.4		656.2		449.5		314.4		224.0
Total Proved		19106.0		14106.7		11232.7		9384.4		8101.3
Probable Additional		11173.0		6276.2		4151.7		2987.0		2254.2
Total Proved + Probable		30278.9		20382.9		15384.4		12371.4		10355.6

Notes:

1.	Values may not add due to rounding

2.	M$ = Thousands of Dollars($CDN)

Page | 2

3.	Additional Information Concerning Future Net Revenue (Forecast Case)

Total Future Net Revenue (Undiscounted)

INTERNATIONAL SOVEREIGN ENERGY CORP.

Forecast Prices & Costs - InSite December 31, 2010 Prices


	Revenue		Royalties		Operating Costs		Development Costs		Well Abandonment Costs		Future Net Revenue BIT		Income Taxes		Future Net Revenue AIT
Reserves Category	(M$)		(M$)		(M$)		(M$)		(M$)		(M$)		(M$)		(M$)
Proved Developed Producing		35375.6		4122.2		12549.0		90.0		498.5		18115.9		0.0		18115.9
Proved Developed Non-Producing		155.2		23.1		108.1		0.0		14.3		9.7		0.0		9.7
Proved Undeveloped		1889.1		183.3		662.7		56.3		6.3		980.4		0.0		980.4
Total Proved		37419.9		4328.7		13319.8		146.3		519.1		19106.0		0.0		19106.0
Probable Additional		36630.2		5673.4		13908.1		2047.0		196.3		14805.4		3632.4		11173.0
Total Proved + Probable		74050.0		10002.1		27228.0		2193.3		715.4		33911.3		3632.4		30278.9

Page | 3

Oil and Gas Reserves and Net Present Values By Production Group

INTERNATIONAL SOVEREIGN ENERGY CORP.

Forecast Prices & Costs - InSite December 31, 2010 Prices


	Reserves
	Oil				Gas				Natural Gas Liquids				Net Present Value Before Tax
	Gross (Mbbl)		Net (Mbbl)		Gross (MMcf)		Net (MMcf)		Gross (Mbbl)		Net (Mbbl)		5% (M$)		10% (M$)		15% (M$)		20% (M$)
Light and Medium Oil
PDP		109.1		114.8		3.8		3.2		0.4		0.3		6099.3		4592.6		3704.3		3123.5
PDNP		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
PU		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
PD+PU		109.1		114.8		3.8		3.2		0.4		0.3		6099.3		4592.6		3704.3		3123.5
PA		58.5		54.4		2.2		1.9		0.2		0.2		2166.5		1290.0		917.5		715.9
P+PA		167.6		169.2		6.0		5.1		0.6		0.5		8265.8		5882.6		4621.8		3839.5

Heavy Oil
PDP		147.8		132.8		39.0		36.6		0.0		0.0		4018.5		3278.9		2774.6		2413.5
PDNP		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
PU		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
PD+PU		147.8		132.8		39.0		36.6		0.0		0.0		4018.5		3278.9		2774.6		2413.5
PA		115.5		97.1		28.0		26.2		0.0		0.0		1884.4		1158.4		813.5		625.3
P+PA		263.3		229.9		67.0		62.8		0.0		0.0		5902.8		4437.3		3588.0		3038.9

Associated and Non-Associated Gas
PDP		0.0		0.0		1870.4		1575.8		10.0		7.2		3322.7		2901.6		2580.9		2330.0
PDNP		0.0		0.0		37.4		30.8		0.0		0.0		10.0		10.1		10.2		10.2
PU		0.0		0.0		273.4		241.7		0.0		0.0		656.2		449.5		314.4		224.0
PD+PU		0.0		0.0		2181.2		1848.3		10.0		7.2		3988.9		3361.2		2905.5		2564.3
PA		0.0		0.0		2449.6		1998.5		16.6		12.6		3818.8		2504.9		1694.4		1166.6
P+PA		0.0		0.0		4630.9		3846.8		26.6		19.9		7807.7		5866.1		4599.9		3730.9

Totals
PDP		256.9		247.6		1913.2		1615.6		10.3		7.5		13440.5		10773.0		9059.8		7867.1
PDNP		0.0		0.0		37.4		30.8		0.0		0.0		10.0		10.1		10.2		10.2
PU		0.0		0.0		273.4		241.7		0.0		0.0		656.2		449.5		314.4		224.0
PD+PU		256.9		247.6		2224.0		1888.0		10.3		7.5		14106.7		11232.7		9384.4		8101.3
PA		174.0		151.6		2479.8		2026.6		16.8		12.8		7869.7		4953.3		3425.4		2507.9
P+PA		430.9		399.1		4703.8		3914.6		27.2		20.4		21976.4		16186.0		12809.8		10609.2

Notes:

1.	See NI 51-101 Table 5’s for price and cost assumptions

2.	Values may not add due to rounding

3.	M$ = Thousands of Dollars

Page | 4

International Sovereign Energy Corp.

Unit Value of Net Reserves By Production Group

INTERNATIONAL SOVEREIGN ENERGY CORP.

Forecast Prices & Costs - InSite December 31, 2010 Prices

Effective December 31, 2010


	Reserves								Net Present		Unit
	Net Oil (Mbbl)		Net Gas (MMcf)		Net NGL (MMcf)		Net Total BOE (MMcf)		Value (10%) (M$)		Value ($/bbl or $/Mcf)
Light and Medium Oil
Proved Developed Producing		114.8		3.2		0.3		115607.3		4592.6		39.7
Proved Developed Non-Producing		0.0		0.0		0.0		0.0		0.0		0.0
Proved Undeveloped		0.0		0.0		0.0		0.0		0.0		0.0
Total Proved		114.8		3.2		0.3		115607.3		4592.6		39.7
Probable Additional		54.4		1.9		0.2		54926.2		1290.0		23.5
Total Proved + Probable		169.2		5.1		0.5		170533.5		5882.6		34.5

Heavy Oil
Proved Developed Producing		132.8		36.6		0.0		138881.3		3278.9		23.6
Proved Developed Non-Producing		0.0		0.0		0.0		0.0		0.0		0.0
Proved Undeveloped		0.0		0.0		0.0		0.0		0.0		0.0
Total Proved		132.8		36.6		0.0		138881.3		3278.9		23.6
Probable Additional		97.1		26.2		0.0		101502.7		1158.4		11.4
Total Proved + Probable		229.9		62.8		0.0		240384.1		4437.3		18.5

Associated and Non-Associated Gas
Proved Developed Producing		0.0		1575.8		7.2		269864.5		2901.6		10.8
Proved Developed Non-Producing		0.0		30.8		0.0		5129.6		10.1		2.0
Proved Undeveloped		0.0		241.7		0.0		40289.8		449.5		11.2
Total Proved		0.0		1848.3		7.2		315283.9		3361.2		10.7
Probable Additional		0.0		1998.5		12.6		345725.9		2504.9		7.3
Total Proved + Probable		0.0		3846.8		19.9		661009.8		5866.1		8.9

Totals
Proved Developed Producing		247.6		1615.6		7.5		524353.1		10773.0		20.6
Proved Developed Non-Producing		0.0		30.8		0.0		5129.6		10.1		2.0
Proved Undeveloped		0.0		241.7		0.0		40289.8		449.5		11.2
Total Proved		247.6		1888.0		7.5		569772.6		11232.7		19.7
Probable Additional		151.6		2026.6		12.8		502154.9		4953.3		9.9
Total Proved + Probable		399.1		3914.6		20.4		1071927.5		16186.0		15.1

Notes:

1.	Values may not add due to rounding

2.	M$ = Thousands of Dollars

3.	Cash Flows do not include Alberta Royalty Tax Credit

Page | 5

Item 2.2 Reserves Data (Constant Prices and Costs)

N/A

Item 2.3 Reserves Disclosure Varies With Accounting

N/A

Item 2.4 Future Net Revenue Disclosure Varies With Accounting

N/A

Page | 6

PART 3

PRICING ASSUMPTIONS

Item 3.1 Constant Prices used in Estimates

N/A

Item 3.2 Forecast Prices used in Estimates

(a)

Pricing Assumptions

INSITE PETROLEUM CONSULTANTS LTD.

INTERNATIONAL SOVEREIGN ENERGY CORP.

FORECAST PRICES AND COSTS ASSUMPTIONS

December 31, 2010


YEAR	WTI @ CUSHING		CDN/US EXCHANGE RATE		WTI @ CUSHING		EDM REF PRICE		HARDISTY 25 API		HEAVY 12 API		CROMER 29 API		CONDEN- SATE		BUTANE		PROPANE		ETHANE		SULPHUR
	$US/BBL				$C/BBL		$C/BBL		$C/BBL		$C/BBL		$C/BBL		$C/BBL		$C/BBL		$C/BBL		$C/BBL		$/LT
2011		88.00		0.980		89.80		87.30		77.30		70.30		81.19		91.66		69.84		52.38		12.51		30.00
2012		90.00		0.970		92.78		90.28		78.28		71.28		83.96		92.99		72.23		54.17		14.34		35.00
2013		92.00		0.960		95.83		93.83		79.83		72.83		87.27		96.65		75.07		56.30		16.21		40.00
2014		94.00		0.960		97.92		95.88		79.88		72.88		89.17		98.75		76.70		57.53		17.73		45.00
2015		96.00		0.960		100.00		97.92		81.60		74.60		91.06		100.86		78.34		58.75		19.36		50.00

2016		97.92		0.960		102.00		99.88		83.23		76.23		92.89		102.87		79.90		59.93		20.98		51.00
2017		99.88		0.960		104.04		101.88		84.90		77.90		94.74		104.93		81.50		61.13		21.76		52.02
2018		101.88		0.960		106.12		103.91		86.59		79.59		96.64		107.03		83.13		62.35		22.21		53.06
2019		103.91		0.960		108.24		105.99		88.33		81.33		98.57		109.17		84.79		63.59		22.66		54.12
2020		105.99		0.960		110.41		108.11		90.09		83.09		100.54		111.35		86.49		64.87		23.11		55.20

2021		108.11		0.960		112.62		110.27		91.89		84.89		102.55		113.58		88.22		66.16		23.58		56.31
2022		110.27		0.960		114.87		112.48		93.73		86.73		104.60		115.85		89.98		67.49		24.06		57.43
2023		112.48		0.960		117.17		114.73		95.61		88.61		106.70		118.17		91.78		68.84		24.55		58.58
2024		114.73		0.960		119.51		117.02		97.52		90.52		108.83		120.53		93.62		70.21		25.04		59.75
2025		117.02		0.960		121.90		119.36		99.47		92.47		111.01		122.94		95.49		71.62		25.55		60.95

2026		119.36		0.960		124.34		121.75		101.46		94.46		113.23		125.40		97.40		73.05		26.07		62.17
2027		121.75		0.960		126.82		124.19		103.49		96.49		115.49		127.91		99.35		74.51		26.60		63.41
2028		124.19		0.960		129.36		126.67		105.56		98.56		117.80		130.47		101.34		76.00		27.13		64.68

YEAR	HENRY HUB		AECO C		ALBERTA 1 YR FIRM		ALBERTA SPOT		AGGRE- GATOR		ALLIANCE		ALBERTA AGRP		SASK SPOT		SASK PROVGAS		SUMAS SPOT		BC STN 2		BC CANWEST WELLHEAD
	$US/ MMBTU		C$/ MMBTU		C$/ MMBTU		C$/ MMBTU		C$/ MMBTU		C$/ MMBTU		C$/ MMBTU		C$/ MMBTU		C$/ MMBTU		C$/ MMBTU		C$/ MMBTU		C$/ MMBTU
2011		4.50		4.14		3.94		3.94		3.79		3.69		3.85		4.09		3.89		4.44		3.94		3.44
2012		5.20		4.71		4.50		4.50		4.35		4.25		4.41		4.65		4.45		5.01		4.51		4.01
2013		5.75		5.29		5.08		5.08		4.93		4.82		4.99		5.23		5.03		5.59		5.09		4.59
2014		6.25		5.76		5.54		5.54		5.39		5.28		5.45		5.69		5.49		6.06		5.56		5.06
2015		6.75		6.27		6.05		6.05		5.90		5.77		5.96		6.20		6.00		6.57		6.07		5.57

2016		7.25		6.77		6.55		6.55		6.40		6.27		6.46		6.70		6.50		7.07		6.57		6.07
2017		7.50		7.02		6.79		6.79		6.64		6.51		6.70		6.94		6.74		7.32		6.82		6.32
2018		7.65		7.16		6.92		6.92		6.77		6.64		6.83		7.07		6.87		7.46		6.96		6.46
2019		7.80		7.30		7.06		7.06		6.91		6.77		6.97		7.21		7.01		7.60		7.10		6.60
2020		7.96		7.45		7.20		7.20		7.05		6.90		7.11		7.35		7.15		7.75		7.25		6.75

2021		8.12		7.59		7.35		7.35		7.20		7.04		7.26		7.50		7.30		7.89		7.39		6.89
2022		8.28		7.75		7.49		7.49		7.34		7.18		7.40		7.64		7.44		8.05		7.55		7.05
2023		8.45		7.90		7.64		7.64		7.49		7.33		7.55		7.79		7.59		8.20		7.70		7.20
2024		8.62		8.06		7.80		7.80		7.65		7.47		7.71		7.95		7.75		8.36		7.86		7.36
2025		8.79		8.22		7.95		7.95		7.80		7.62		7.86		8.10		7.90		8.52		8.02		7.52

2026		8.96		8.39		8.11		8.11		7.96		7.77		8.02		8.26		8.06		8.69		8.19		7.69
2027		9.14		8.55		8.27		8.27		8.12		7.93		8.18		8.42		8.22		8.85		8.35		7.85
2028		9.33		8.72		8.44		8.44		8.29		8.09		8.35		8.59		8.39		9.02		8.52		8.02

Note: All prices escalated at 2% per year after 2028; All costs escalated at 2% per year from 2011; First year forecast is for 12 months

Page | 7

(b)

Average Selling Prices


2010	Q1		Q2		Q3		Q4
Crude Oil ($/Bbl)	$	71.84	$	64.47	$	67.82	$	66.72

Natural Gas Liquids ($/Bbl)	$	57.90	$	54.43	$	48.17	$	43.80

Natural Gas ($/Mcf)	$	4.81	$	3.54	$	3.47	$	2.88

3.	Qualified Reserves Evaluator

The pricing assumptions provided in item 3.2 (Section 1) were provided by a qualified reserves evaluator (who is independent of International Sovereign Energy Corp.), namely InSite Petroleum Consultants Ltd.

Page | 8

PART 4

RECONCILIATIONS OF CHANGES IN RESERVES AND FUTURE NET REVENUE

Item 4.1 Reserves Reconciliation

Reconciliation of Company WI Reserves by Principal Product Type

INTERNATIONAL SOVEREIGN ENERGY CORP.

Working Interest Share

Opening: 2009-12-31 Forecast Prices & Costs - PLA December 31, 2009 Prices

Closing: 2010-12-31 Forecast Prices & Costs – InSite December 31, 2010 Prices


	Light & Medium Oil						Heavy Oil						Associated & Non-Associated Gas
	WI Proved		WI Probable		WI Proved + Probable		WI Proved		WI Probable		WI Proved + Probable		WI Proved		WI Probable		WI Proved + Probable
	Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		MMcf		MMcf		MMcf
Opening Balance		129.8		50.9		180.7		151.9		131.9		283.8		3,465.3		3,892.8		7,358.1
Extensions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Improved Recovery		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Technical Revisions		2.4		-0.3		2.1		18.7		-16.3		2.4		-259.0		-1,463.1		-1,722.1
Discoveries		0.0		14.4		14.4		0.0		0.0		0.0		0.0		19.9		19.9
Acquisitions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Dispositions		-12.5		-6.5		-19.0		0.0		0.0		0.0		0.0		0.0		0.0
Economic Factors		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Production		-10.6		0.0		-10.6		-22.9		0.0		-22.9		-1,025.1		0.0		-1,025.1
Closing Balance		109.1		58.5		167.6		147.8		115.5		263.3		2,181.2		2,449.6		4,630.9

Page | 9

Reconciliation of Company Working Interest Reserves by Principal Product Type

INTERNATIONAL SOVEREIGN ENERGY CORP.

Opening: 2009-12-31 Forecast Prices & Costs - PLA December 31, 2009 Prices; Closing: 2010-12-31 Forecast Prices & Costs - InSite December 31, 2010 Prices


	Light & Medium Oil						Heavy Oil						Associated & Non-Associated Gas						Total
	WI Proved		WI Probable		WI Proved + Probable		WI Proved		WI Probable		WI Proved + Probable		WI Proved		WI Probable		WI Proved + Probable		WI Proved		WI Probable		WI Proved + Probable
OIL		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb


Opening Balance		129.8		50.9		180.7		151.9		131.9		283.8		0.0		0.0		0.0		281.8		182.7		464.5

Extensions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Improved Recovery		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Technical Revisions		2.4		-0.3		2.1		18.7		-55.2		-36.5		0.0		0.0		0.0		21.1		-55.6		-34.4

Discoveries		0.0		14.4		14.4		0.0		38.9		38.9		0.0		0.0		0.0		0.0		53.3		53.3

Acquisitions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Dispositions		-12.5		-6.5		-19.0		0.0		0.0		0.0		0.0		0.0		0.0		-12.5		-6.5		-19.0

Economic Factors		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Production		-10.6		0.0		-10.6		-22.9		0.0		-22.9		0.0		0.0		0.0		-33.5		0.0		-33.5

Closing Balance		109.1		58.5		167.6		147.8		115.5		263.3		0.0		0.0		0.0		256.9		174.0		430.9


GAS		MMcf		MMcf		MMcf		MMcf		MMcf		MMcf		MMcf		MMcf		MMcf		MMcf		MMcf		MMcf


Opening Balance		7.9		5.8		13.6		71.5		46.7		118.1		3,465.3		3,892.8		7,358.1		3,544.7		3,945.2		7,489.9

Extensions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Improved Recovery		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Technical Revisions		-3.6		-3.5		-7.1		-27.1		-18.7		-45.8		-259.0		-1,463.1		-1,722.1		-289.7		-1,485.3		-1,775.0

Discoveries		0.0		0.0		0.0		0.0		0.0		0.0		0.0		19.9		19.9		0.0		19.9		19.9

Acquisitions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Dispositions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Economic Factors		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Production		-0.5		0.0		-0.5		-5.4		0.0		-5.4		-1,025.1		0.0		-1,025.1		-1,031.0		0.0		-1,031.0

Closing Balance		3.8		2.2		6.0		39.0		28.0		67.0		2,181.2		2,449.6		4,630.9		2,224.0		2,479.8		4,703.8


NGL		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb		Mstb


Opening Balance		1.1		0.8		1.9		0.0		0.0		0.0		17.2		19.3		36.5		18.3		20.1		38.3
Extensions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Improved Recovery		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Technical Revisions		-0.6		-0.6		-1.2		0.0		0.0		0.0		-2.1		-5.0		-7.1		-2.7		-5.6		-8.3

Discoveries		0.0		0.0		0.0		0.0		0.0		0.0		0.0		2.3		2.3		0.0		2.3		2.3

Acquisitions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Dispositions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Economic Factors		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Production		-0.1		0.0		-0.1		0.0		0.0		0.0		-5.1		0.0		-5.1		-5.2		0.0		-5.2

Closing Balance		0.4		0.2		0.6		0.0		0.0		0.0		10.0		16.6		26.6		10.3		16.8		27.2


BOEs		MBOE		MBOE		MBOE		MBOE		MBOE		MBOE		MBOE		MBOE		MBOE		MBOE		MBOE		MBOE


Opening Balance		132.2		58.0		188.7		151.6		115.8		267.3		594.7		861.8		1,262.8		1,249.6		1,035.5		2,285.2
Extensions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Improved Recovery		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Technical Revisions		1.2		-1.5		-0.3		14.2		-58.3		-44.1		-45.3		-248.9		-294.1		-29.9		-308.7		-338.6

Discoveries		0.0		14.4		14.4		0.0		38.9		38.9		0.0		5.6		5.6		0.0		59.0		59.0

Acquisitions		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Dispositions		-12.5		-6.5		-19.0		0.0		0.0		0.0		0.0		0.0		0.0		-12.5		-6.5		-19.0

Economic Factors		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0

Production		-10.7		0.0		-10.7		-23.8		0.0		-23.8		-176.0		0.0		-176.0		-210.5		0.0		-210.5

Closing Balance		110.1		59.1		169.2		154.3		120.2		274.5		373.5		424.9		798.4		637.9		604.1		1,242.1

Page | 10

PART 5

ADDITIONAL INFORMATION RELATING TO RESERVES DATA

Item 5.1 Undeveloped Reserves

1.	Proved Undeveloped Reserves

(a)


YEAR	Light & Medium Oil				Heavy Oil				Associated & Non- Associated Gas				NGL
	1^st Attributed		Cumulative at Year End		1^st Attributed		Cumulative at Year End		1^st Attributed		Cumulative at Year End		1^st Attributed		Cumulative at Year End
	Mstb		Mstb		Mstb		Mstb		MMcf		MMcf		Mstb		Mstb
Pre-2008		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
2008		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
2009		4.9		4.9		0.0		0.0		330.7		330.7		0.0		0.0
2010		0.0		0.0		0.0		0.0		0.0		241.7		0.0		0.0

(b)

International Sovereign relies upon its independent reserve evaluator to assign proved undeveloped reserves to company properties in accordance with criteria as set out in the various governing regulations. Therefore International Sovereign, as such, does not attribute reserves or reserve categories to our own properties. We understand that evaluator looks to 2 criteria: firstly, whether wells have to be drilled to access the assigned reserves, and secondly, whether the size of the remaining capital to be spent to bring the property on to production is significant relative to the underlying property value.

International Sovereign plans to develop the proved undeveloped reserves over the next 2 years once the current production from the wellbores that have the assigned reserves are no longer economic along with additional new drills.

2.	Probable Undeveloped Reserves


YEAR	Light & Medium Oil				Heavy Oil				Associated & Non- Associated Gas					NGL
	1^st Attributed		Cumulative at Year End		1^st Attributed		Cumulative at Year End		1^st Attributed		Cumulative at Year End			1^st Attributed		Cumulative at Year End
	Mstb		Mstb		Mstb		Mstb		MMcf		MMcf			Mstb		Mstb
Pre-2008		0.0		0.0		0.0		0.0		941.3		1392.3	¹		5.5		5.5
2008		0.0		0.0		0.0		0.0		0.0		1392.3			0.0		5.5
2009		0.0		0.0		30.1		30.1		310.5		1,702.8			3.3		8.8
2010		11.4		11.4		14.9		14.9		15.8		1,163.6			1.7		9.3

¹	Undeveloped reserves were technically revised from portions assigned in 2006 & 2007.

Page | 11

(b)

International Sovereign relies upon its independent reserve evaluator to assign probable undeveloped reserves to company properties in accordance with criteria as set out in the various governing regulations. Therefore International Sovereign, as such, does not attribute reserves or reserve categories to our own properties. We understand that evaluator looks to 2 criteria: firstly, whether wells have to be drilled to access the assigned reserves, and secondly, whether the size of the remaining capital to be spent to bring the property on to production is significant relative to the underlying property value.

The properties carrying the probable undeveloped reserves are anticipated to be partially developed in calendar 2011 & 2012 (pending commodity prices) with the drilling of two wells. One of the wells, located in the Medicine River area of Alberta, will be targeting Belly River and Edmonton sand gas potential. The second, located in the Marwayne area of Alberta, will target the Rex formation. These wells will be placed on production given successful results.

Item 5.2 Significant Factors or Uncertainties

Estimates of economically recoverable oil and natural gas reserves (including natural gas liquids) and the future net cash flows there from are based upon a number of variable factors and assumptions, such as commodity prices, projected production from the properties, the assumed effects of regulation by government agencies and future operating costs. All of these estimates may vary from actual results. Estimates of the recoverable oil and natural gas reserves attributable to any particular group of properties, classifications of such reserves based on risk of recover and estimates of future net revenues expected there from, may vary. The Company’s actual production, revenues, taxes, development and operating expenditures with respect to its reserves may vary from such estimates, and such variances could be material.

The Company’s independent engineering firm, InSite, uses a deterministic approach in the estimation of reserves. Reserves are assessed using a discrete value for each parameter in the calculation of reserves, such that the resultant reserve value is consistent with the certainty level associated with the reserve classification. In accordance with NI 51-101, the following definitions are followed by InSite in their analysis:

•

Proved reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves.

•

Probable reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves.

Page | 12

Item 5.3 Future Development Costs

CAPITAL SCHEDULE

INTERNATIONAL SOVEREIGN ENERGY CORP.

FORECAST PRICES & COSTS—InSite DECEMBER 31, 2010 PRICES


	TOTAL PROVED RESERVES UNDISCOUNTED M$		TOTAL PROVED RESERVES DISCOUNTED @ 10% M$		TOTAL PROVED + PROBABLE RESERVES DISCOUNTED @10% M$		TOTAL PROVED + PROBABLE RESERVES DISCOUNTED @ 10% M$
2011		90		82.17		2073.81		1943.91
2012		0		0		0		0
2013		0		0		0		0
2014		0		0		0		0
2015		0		0		0		0
2016		0		0		0		0
2017		56.31		30.31		0		0
2018		0		0		0		0
2019		0		0		0		0
2020		0		0		119.51		48.32
SUB.		146.31		112.47		2193.32		1992.24
REM.		0		0		0		0
TOTAL		146.31		112.47		2193.32		1992.24

Notes:

1.	See NI 51-101 Table 5’s for price and cost assumptions

2.	Canadian properties prepared with InSite December 31, 2010 Prices and Costs Assumptions

3.	Values may not add due to rounding

2.	The Company intends to finance the future development costs through internally generated cash flow which should have no effect on the disclosed reserves or future net revenue.

Page | 13

PART 6

OTHER OIL AND GAS INFORMATION

Item 6.1 Oil and Gas Properties and Wells

1.	Notable Properties

The following eleven properties comprise in excess of 90% of International Sovereign Energy Corp.’s budgeted 2011 lease operating income.


PROPERTY	LOCATION	COUNTRY	ONSHORE/ OFFSHORE
Medicine River	Twp 38-2&3 W5M, Alberta	Canada	Onshore

Wildmere Unit	Twp 47-4 W4M, Alberta	Canada	Onshore

Marwayne	Twp 52-1 W4M, Alberta	Canada	Onshore

Little Bow	Twp 14-20&21 W4M, Alberta	Canada	Onshore

Red Earth	Twp 87-9 W5M, Alberta	Canada	Onshore

Clarke Lake	Block 94-J-10, British Columbia	Canada	Onshore

Swan Hills	Twp 64-10W5M, Alberta	Canada	Onshore

Inga	Twp 85-23W6M, British Columbia	Canada	Onshore

Ft. St. John	Twp 83-18W6M, British Columbia	Canada	Onshore

Berwyn	Twp 82-24W5M, Alberta	Canada	Onshore

Boundary Lake	Twp 83-12W6M, Alberta	Canada	Onshore

2.	Well Type Breakdown

Oil and Natural Gas Wells


	Producing Wells								Non-Producing Wells
	Oil				Natural Gas				Oil				Natural Gas
Province	Gross		Net		Gross		Net		Gross		Net		Gross		Net
Alberta		109.00		6.71		16.00		6.74		25.00		16.47		22.00		13.37
B.C.		6.00		1.30		5.00		0.79		0.00		0.00		1.00		0.26

Total		115.00		8.01		21.00		7.53		25.00		16.47		23.00		13.37

Page | 14

Item 6.2 Properties with no Attributed Reserves

1.	International Sovereign has an interest in 14,641 gross hectares (11,120 net hectares) of undeveloped lands in Alberta, British Columbia, and Manitoba Canada.

2.	4,035 gross hectares (2,984 net hectares) of undeveloped lands in Alberta and British Columbia Canada are expected to expire in calendar 2011.

Item 6.3 Forward Contracts

N/A

Item 6.4 Additional Information Concerning Abandonment and Reclamation Costs

(a)

The best engineering estimates of these costs are used from the experience of the reporting issuer’s staff. Should staff in certain circumstances not feel competent to make such estimates, outside consulting advice is sought and used.

(b)

We expect that we will incur such costs for 45.38 net wells.

(c)

The total amount of such costs, net of salvage value is $715,351 undiscounted, $204,313 when a 10% discount factor is used.

(d)

Provision has not been made in the engineering reports for an estimated $857,363 for abandonment and reclamation costs (undiscounted) for properties not evaluated. Such provisions were made in the report for any property evaluated as having reserves.

(e)

It is expected that $275,000 of abandonment and reclamation costs (undiscounted) will be incurred in the next three financial years, in total.

Item 6.5 Tax Horizon

The income taxes deducted in the calculation of future net revenue above assume a blow down scenario whereby the Company produces out its existing reserves.

The Company forecasts its tax horizon, assuming current commodity prices, and a continuing business model whereby it reinvests capital at historic capital efficiencies and incurs general and administrative costs and interest costs. Under this scenario, with the current reserves and tax pools, it is expected that taxes will not be payable in the foreseeable future as determined by 3^rd party evaluators.

Page | 15

Item 6.6 Costs Incurred

Capitalized or Expense

During 2010, the Company incurred the following costs:


	2010 $			2009 $
Property Acquisition Costs – Unproved Properties²		(260,295	)		333,574
Property Acquisition Costs – Proved Properties³		—			—
Exploration Costs		1,445,953			3,493,378
Development Costs		249,255			777,089

Total		1,434,913			4,604,041

Item 6.7 Exploration and Development Activities


	Development Wells				Exploration Wells				Total Wells
	Gross		Net		Gross		Net		Gross		Net
Oil Wells		1.00		0.40		0.00		0.00		1.00		0.40
Natural Gas Wells		0.00		0.00		0.00		0.00		0.00		0.00
Dry Holes		0.00		0.00		1.00		1.00		1.00		1.00

Total		0.00		0.00		0.00		0.00		2.00		1.40

2.	International Sovereign expects to be involved in the following capital projects in 2011:


Marwayne, Canada		Attempt optimizations on current wellbores in order to increase the current production and recovery factors of the field.

Medicine River, Canada		Drill 4 Edmonton Sands wells pending commodity prices.

²,³	Property acquisition costs are net of dispositions and transfers. Sinclair was the only Disposition of note during 2010.

Page | 16

Item 6.8 Production Estimates

1.	Production Estimates for 2011

(i)

Total Proved


Estimated 2011 Production – Total Proved	MBbl		MMcf
Light & Medium Oil		12.7
Heavy Oil		20.8
NGL		2.7
Natural Gas				501.7

(ii)

Total Proved + Probable


Estimated 2011 Production – Total Proved + Probable	MBbl		MMcf
Light & Medium Oil		16.0
Heavy Oil		27.6
NGL		3.4
Natural Gas				602.7

2.	In 2011, the Berwyn gas property is estimated to account for 144.6 MMcf in the Total Proved estimates & 184.1 MMcf in the Total Proved + Probable estimates.

Page | 17

Item 6.9 Production History

2010 Production Details


	2010
	Annual		Q4		Q3		Q2		Q1
Natural Gas (Mcf/d)		2,850		2,273		2,132		3,235		3,783
Crude Oil (Bbls/d)		110		110		05		107		121
NGLs (Bbls/d)		11		110		8		14		12

Total Production (Boe/d)		596		496		468		659		764

Important Field Production Volumes for 2010


Important Field	Category	Oil (Bbls)		Gas (Mcf)		NGLs (Bbls)
Marwayne	Heavy Oil		10,661		2,108		—
Wildmere	Heavy Oil		13,092		3,674		—
Berwyn	NA Gas		—		294,939		—
Clarke Lake	NA Gas		—		123,430		—
Boundary Lake	NA Gas		—		374,139		—
Red Earth	Light Oil		6,944		—		—
Medicine River	NA Gas		—		162,085		3,984
Inga	Light Oil		4,153		—		—
Other Areas	Various		5,462		79,776		—

Company Total			40,312		1,040,151		3,984

Average Selling Prices and Netbacks


2010	Q1		Q2		Q3			Q4		Annual
Natural Gas ($/Mcf)	$	4.81	$	3.54	$	3.47		$	2.88	$	3.81
Crude Oil ($/Bbl)	$	71.84	$	64.47	$	62.01		$	67.82	$	66.72
NGLs ($/Bbl)	$	57.90	$	54.43	$	48.17		$	43.80	$	51.79

Totals ($/Boe)	$	36.17	$	28.89	$	30.42		$	29.04	$	31.54

Royalties ($/Boe)	$	7.94	$	7.32	($	1.92	)	$	2.01	$	4.57
Operating Costs ($/Boe)	$	8.66	$	14.49	$	10.48		$	13.17	$	11.58

Netback Received ($/Boe)	$	19.57	$	7.08	$	21.86		$	13.86	$	15.39

Page | 18

FORM 51-101F2

REPORT ON RESERVES DATA

INDEPENDENT QUALIFIED RESERVES

EVALUATOR OR AUDITOR

This is the form referred to in item 2 of section 2.1 of

National Instrument 51-101 Standards of

Disclosure for Oil and Gas Activities (“NI 51-101”).

Page | 19

FORM 51-101F2

Report on Reserves Data

By Independent Qualified Reserves Evaluator or Auditor

To the board of directors of International Sovereign Energy Corp. (the “Company”):

1.	We have evaluated the Company’s reserves data as at December 31, 2010. The reserves data are estimates of proved reserves and probable reserves and related future net revenue as at December 31, 2010, estimated using forecast prices and costs.

2.	The reserves data are the responsibility of the Company’s management. Our responsibility is to express an opinion on the reserves data based on our evaluation.

We carried out our evaluation in accordance with standards set out in the Canadian Oil and Gas Evaluation Handbook (the “COGE Handbook”) prepared jointly by the Society of Petroleum Evaluation Engineers (Calgary Chapter) and the Canadian Institute of Mining, Metallurgy & Petroleum (Petroleum Society).

Those standards require that we plan and perform an evaluation to obtain reasonable assurance as to whether the reserves data are free of material misstatement. An evaluation also includes assessing whether the reserves data are in accordance with principles and definitions presented in the COGE Handbook.

The following table sets forth the estimated future net revenue (before deduction of income taxes) attributed to proved plus probable reserves, estimated using forecast prices and costs and calculated using a discount rate of 10 percent, included in the reserves data of the Company evaluated by us for the year ended December 31, 2010, and identifies the respective portions thereof that we have audited, evaluated and reviewed and reported on to the Company’s Board of Directors:

Independent

Qualified Reserves

Evaluator or Auditor

Description and

Preparation Date of

Evaluation Report

Location of
Reserves
(Country or
Foreign
Geographic
Area)

Net Present Value of Future Net Revenue ($ thousands
CDN - before income taxes, 10% discount rate)¹

Audited

Evaluated

Reviewed

Total

InSite Petroleum Consultants Ltd.

International Sovereign Energy Corp. Evaluation of Oil & Gas Properties as at December 31, 2010 and prepared March 25, 2011

Canada

Nil

16,186.0

Nil

16,186.0

5.	In our opinion, the reserves data respectively evaluated by us have, in all material respects, been determined and are in accordance with the COGE Handbook, consistently applied. We express no opinion on the reserves data that we reviewed but did not audit or evaluate.

This amount should be the amount disclosed by the reporting issuer in its statement of reserves data filed under item 1 of section 2.1 of NI 51-101, as its future net revenue (before deducting future income tax expenses) attributable to proved plus probable reserves, estimated using forecast prices and costs and calculated using a discount rate of 10 percent (required by section 2 of Item 2.1 of Form 51-101F1). The values represented are shown in Canadian dollars.

6.	We have no responsibility to update our reports referred to in paragraph 4 for events and circumstances occurring after their respective preparation dates.

7.	Because the reserves data are based on judgments regarding future events, actual results will vary and the variations may be material.

Executed as to our report referred to above:

InSite Petroleum Consultants Ltd.

Calgary, Alberta

Execution Date: March 25, 2011

/s/ Larry K. Lindstrom, P.Eng.

Larry K. Lindstrom, P.Eng.

Managing Director

Legend Oil & Gas, Ltd. - FORM 8-K/A - EX-99.3 - ALBERTA, CANADA PROPERTIES EVALUATION OF RESERVES REPORT - November 23, 2011

Attached files

Legend Oil & Gas, Ltd. Reports