Bankers Petroleum Limited Operational update for the first quarter 2016

 
TIDMBNK 
 
Bankers Petroleum operational update for the first quarter 2016 
 
CALGARY, April 5, 2016 /CNW/ - Bankers Petroleum Ltd. ("Bankers" or the 
"Company") (TSX: BNK, AIM: BNK) is pleased to announce the Company's first 
quarter operational update. 
 
Production 
 
Bankers achieved a first quarter 2016 production average of 17,363 barrels of 
oil per day (bopd), 4% below the fourth quarter 2015 average of 18,137 bopd. 
During the first quarter of 2016, the Company continued to optimize current 
production levels and monitor the economic return of all wells in accordance 
with the current oil price environment. 
 
Sales and Oil Prices 
 
In the first quarter of 2016, oil sales averaged 17,280 bopd, compared to the 
fourth quarter sales in 2015 of 18,558 bopd. Crude oil inventory at March 31, 
2016 increased to 266,000 barrels compared to 258,000 barrels at December 31, 
2015. 
 
Bankers' first quarter average oil price was approximately $21.07 per barrel 
(representing 62% of the Brent oil price of $33.89 per barrel), as compared 
with the fourth quarter 2015 average oil price of $33.62 per barrel 
(representing 77% of the Brent oil price of $43.69 per barrel). Sales to the 
export market during the first quarter 2016 represented 96% of total sales. 
Sales prices were lower than expected in the first quarter due to temporarily 
reduced pricing in February at the request of our export crude buyer as Brent 
prices reached levels of $30 per barrel. March crude sales recovered towards 
better pricing as the Brent oil price improved and we are expecting continued 
improvement as we enter into the second quarter and seasonally higher demand 
for heavy crude oil on both the export and domestic markets. 
 
Bankers has hedged 5,000 bopd under costless collar contracts with an average 
floor of $52.09 per barrel and an average ceiling of $54.64 per barrel (all 
prices are referenced to Dated Brent) for the balance of 2016. In the first 
quarter of 2016, the hedge program generated proceeds of $7.4 million. The 
remaining 2016 hedge program at March 31, 2016, is valued at $16.2 million. 
These contracts are designed to protect Bankers against further volatility in 
oil prices in 2016. 
 
Drilling Update 
 
Due to the low oil price environment, Bankers elected to defer drilling 
activity at the start of the year in order to protect the strength of the 
Company's balance sheet. Drilling activity will resume as pricing improves. 
 
Enhanced Oil Recovery (EOR) Program 
 
Bankers continues to monitor the existing polymer flood and water flood 
patterns which continue to perform to reservoir model expectations. The average 
incremental production over primary decline in the month of March coming from 
EOR patterns is approximately 3,219 bopd (representing about 19% of total 
production). The total production coming from these EOR patterns is close to 
4,952 bopd (or 29% of total production). The Company converted one (1) 
producing well to injection in the first quarter and has forty-nine (49) 
polymer and five (5) water flood patterns implemented at the end of the first 
quarter 2016. 
 
Infrastructure Development 
 
In the first quarter of 2016, Bankers focused on completing existing projects 
that will help to optimize operations and capture additional cost savings. The 
commissioning of the north emulsion gathering flowlines was completed early in 
the quarter and is now fully operational. Construction of the west emulsion 
gathering system was also completed in the quarter and is expected to be 
commissioned along with the necessary expansion at satellite facility Pad D in 
the second quarter. 
 
Credit Facility Update 
 
The expiry date for the Company's existing $18 million credit facility from 
Raiffeisen Bank has been extended until May 31, 2016 (from March 31, 2016). 
This will allow sufficient time for Raiffeisen Bank to continue with their due 
diligence requirements pursuant to Bankers' recently announced corporate 
transaction. 
 
Corporate Transaction Update 
 
Pursuant to the March 20, 2016 announcement of the acquisition of the Company 
by affiliates of Geo-Jade Petroleum Corporation, Bankers advises that the 
Special Meeting of Shareholders is currently scheduled on May 31, 2016. The 
meeting materials will be distributed on or before April 26, 2016. 
Additionally, the parties have commenced preparation of the various 
applications for the necessary regulatory approvals. 
 
Updated Corporate Presentation 
 
For additional information on this Operational Update please see the Company's 
April 2016 corporate presentation on the Company's website, 
www.bankerspetroleum.com. 
 
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Caution Regarding Forward-looking Information 
 
Information in this news release respecting matters such as the expected future 
production levels from wells, future prices and netback, work plans, 
anticipated total oil recovery of the Patos-Marinza and Kuçova oilfields, 
timing of the Special Meeting of Shareholders and the regulatory approvals 
required to complete the corporate transaction constitute forward-looking 
information. Statements containing forward-looking information express, as at 
the date of this news release, the Company's plans, estimates, forecasts, 
projections, expectations, or beliefs as to future events or results and are 
believed to be reasonable based on information currently available to the 
Company. 
 
Exploration for oil is a speculative business that involves a high degree of 
risk. The Company's expectations for its Albanian operations and plans are 
subject to a number of risks in addition to those inherent in oil production 
operations, including: that Brent oil prices could fall resulting in reduced 
returns and a change in the economics of the project; availability of 
financing; delays associated with equipment procurement, equipment failure and 
the lack of suitably qualified personnel; the inherent uncertainty in the 
estimation of reserves; exports from Albania being disrupted due to unplanned 
disruptions; and changes in the political or economic environment. 
 
Production and netback forecasts are based on a number of assumptions including 
that the rate and cost of well takeovers, well reactivations and well 
recompletions of the past will continue and success rates will be similar to 
those rates experienced for previous well recompletions/reactivations/ 
development; that further wells taken over and recompleted will produce at 
rates similar to the average rate of production achieved from wells 
recompletions/reactivations/development in the past; continued availability of 
the necessary equipment, personnel and financial resources to sustain the 
Company's planned work program; continued political and economic stability in 
Albania; the existence of reserves as expected; the continued release by 
Albpetrol of areas and wells pursuant to the Plan of Development and Addendum; 
the absence of unplanned disruptions; the ability of the Company to 
successfully drill new wells and bring production to market; and general risks 
inherent in oil and gas operations. 
 
Forward-looking statements and information are based on assumptions that 
financing, equipment and personnel will be available when required and on 
reasonable terms, none of which are assured and are subject to a number of 
other risks and uncertainties described under "Risk Factors" in the Company's 
Annual Information Form and Management's Discussion and Analysis, which are 
available on SEDAR under the Company's profile at www.sedar.com. 
 
There can be no assurance that forward-looking statements will prove to be 
accurate. Actual results and future events could differ materially from those 
anticipated in such statements. Readers should not place undue reliance on 
forward-looking information and forward looking statements. Forward-looking 
statements in this new release are made as of the date hereof, and the Company 
undertakes no obligation to update or revise any forward looking statements, 
whether as a result of new information, future events or otherwise, unless 
required by applicable securities laws. 
 
Review by Qualified Person 
 
This release was reviewed by Suneel Gupta, Executive Vice President and Chief 
Operating Officer of Bankers Petroleum Ltd., who is a "qualified person" under 
the rules and policies of AIM in his role with the Company and due to his 
training as a professional petroleum engineer (member of APEGA) with over 20 
years' experience in domestic and international oil and gas operations. 
 
About Bankers Petroleum Ltd. 
 
Bankers Petroleum Ltd. is a Canadian-based oil and gas exploration and 
production company focused on developing large oil and gas reserves in Albania 
and Eastern Europe. In Albania, Bankers operates and has the full rights to 
develop the Patos-Marinza heavy oilfield, has a 100% interest in the Kuçova 
oilfield, and a 100% interest in Exploration Block "F". In 2015 Bankers 
acquired an 85% interest in the rights to explore the Püspökladány Block 
concession within the Pannonian Basin located in north eastern Hungary. 
Bankers' shares are traded on the Toronto Stock Exchange and the AIM Market in 
London, England under the stock symbol BNK. 
 
 
 
 
David French, President and Chief Executive Officer, [phone]; Doug Urch, 
Executive VP, Finance and Chief Financial Officer, [phone]; Laura 
Bechtel, Investor Relations & Corporate Communications Specialist, (403) 
513-3428; Email: [e-mail], Website: 
www.bankerspetroleum.com; AIM NOMAD: Canaccord Genuity Limited, Henry 
Fitzgerald-O'Connor, [phone]; AIM BROKER: FirstEnergy Capital LLP, 
Hugh Sanderson / David van Erp, [phone] 
 
 
 
 
 
 
END 
 

(END) Dow Jones Newswires

April 05, 2016 07:00 ET (11:00 GMT)