Fully Funded US$247 Million Capital Program in Albania
CALGARY, Dec. 10, 2012 /CNW/ - Bankers Petroleum Ltd. ("Bankers" or the
"Company") (TSX: BNK, AIM: BNK) is pleased to announce its 2013 capital
program of US$247 million, to be fully funded with funds generated from
operations. This represents a record annual activity level and takes Bankers
cumulative capital investment in Albania to over $1 billion. The budget has
been approved by the Company's Board of Directors and submitted to the
Albanian authorities for their approval.
The 2013 capital program will focus on major development activities at the
Patos-Marinza oilfield including production and reserves growth through new
horizontal and vertical drilling, reactivation and workover of existing wells
and implementation of water and polymer flood programs. The Company will also
direct capital towards associated field infrastructure and progression of our
The 2013 work plan will include expansion of the waterflood program and new
drilling at the Kuçova oilfield as well as exploration drilling in Block F.
Abby Badwi, President & CEO commented, "Our 2013 capital budget is designed to
deliver sustainable production growth and to implement the Company's long term
objectives of increasing reserves through primary, secondary and tertiary
recovery methods. We will constantly review our projects' economic returns and
prevailing oil prices to allow for flexibility to expand or contract our
capital programs to remain funded from our cash flow."
Drilling and Reactivation Capital
With five drilling rigs and a budget of $159 million, the Company intends to
drill a total of 110 to 120 wells, primarily horizontal production wells,
along with horizontal lateral re-drills, vertical delineation, core wells, and
water-injection wells. Approximately 70% to 80% of drilling activities will
focus on production growth and 20% to 30% of the wells will target new
reserves through delineation of zones and areas, both within and outside the
field where no reserves have been booked to date. Reactivation and workover of
old vertical wells will continue and the $7 million costs associated with
these activities are included in the drilling budget.
Water and Polymer Flood Program
The 2013 budget includes $10 million for implementation of three waterflood
and one polymer flood patterns, which will be expanded in 2014 and beyond to
offset field declines and increase recovery of the oil in place.
Facilities and Infrastructure
There will be $68 million in capital allocated to facilities and
infrastructure activities, including:
-- construction of additional satellite treatment facilities;
-- planning for our second leg of the crude oil pipeline, 35
kilometre route that will connect the central Fier hub loading
facility to the Vlore Port export terminal;
-- expanded remediation program targeting over 200 old vertical
-- expansion of water disposal capabilities with two to three new
water disposal wells; and
-- continuation of environmental remediation and social
Thermal Pilot Project
Coring programs and simulation studies will continue throughout the year to
determine the best location and zone for the next thermal pilot, which could
lead to future development of the field's large contingent and prospective
resources. Cost estimates for these activities are included in the 2013
Patos-Marinza Field Study and Production Optimization
The Company recently expanded the scope of its current master service
agreement with Weatherford International, one of the world's largest oilfield
services provider, to provide integrated solutions for its various activities
at Patos-Marinza including but not limited to, artificial lift optimization,
well construction design and in-depth reservoir geo-mechanics review and
Weatherford's technical experts will be assigned to the project and, in
cooperation with Bankers' technical team, are expected to enhance our
operational practices and determine the best technology required to improve
The multi-faceted study will be completed in three phases over several
quarters. The first phase focusing on production optimization recommendations
will be available for implementation during the first quarter of 2013.
Cost estimates for this project are included in the 2013 capital program.
An additional $7 million will be directed towards the Kuçova oilfield with
focus on expanding the waterflood pilot project, drilling three new wells and,
developing localized infrastructure including gathering lines to a centralized
oil treating facility.
BLOCK F EXPLORATION BLOCK
One exploration well is planned for 2013 in Block F and comprises the majority
of the $3 million capital expenditure.
CAPITAL PROGRAM FUNDING
Utilizing a $103 Brent oil price forecast ($105 for Q1/Q2 and $100 for Q3/Q4)
and average price realization of 80% of Brent for Patos-Marinza crude, Bankers
expects to fully fund the 2013 capital program with funds generated from
With this capital program Bankers expects to achieve 10% to 15% annual growth
from its 2012 average production while continuing to focus capital on reserves
CHANGE TO AIM BROKER
FirstEnergy Capital LLP has been appointed to act as the Company's Broker for
the London AIM Exchange effective January 1, 2013. FirstEnergy is a leading
energy-focused bank, providing full-service energy investment banking
Canaccord Genuity will continue to act exclusively as our Nominated Advisor
(NOMAD) to Bankers Petroleum Ltd.
UPDATED CORPORATE PRESENTATION
For additional information on this operational update, please see the December
2012 version of the Company's corporate presentation at
Management of Bankers will host a conference call on December 10, 2012 at 7:00
am MST to discuss the 2013 Capital Budget. Following Management's
presentation, there will be a question and answer session for analysts and
To participate in the conference call, please contact the conference operator
ten minutes prior to the call at 1-888-231-8191 or 1-647-427-7450. A live
audio web cast of the conference call will also be available on Bankers
website at http://www.bankerspetroleum.com or by entering the following URL
into your web browser
http://www.newswire.ca/en/webcast/detail/1084587/1181537. The web cast will be
archived two hours after the presentation on the website, and posted on the
website for 90 days. A replay of the call will be available until December 24,
2012 by dialing 1-855-859- 2056 or 1-416-849-0833 and entering access code
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
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.
Review by Qualified Person
This release was reviewed by Suneel Gupta, Executive Vice President and COO 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 APEGGA) 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, Bankers operates and has the full rights to develop the Patos-Marinza
heavy oilfield and has a 100% interest in the Kuçova oilfield, and a 100%
interest in Exploration Block "F". Bankers' shares are traded on the Toronto
Stock Exchange and the AIM Market in London, England under the stock symbol
Abby Badwi President and Chief Executive Officer (403) 513-2694 Doug Urch
Executive VP, Finance and Chief Financial Officer (403) 513-2691 Mark Hodgson
VP, Business Development (403) 513-2695
Website:www.bankerspetroleum.com AIM NOMAD Canaccord Genuity Limited Henry
Fitzgerald-O'Connor +44 20 7023 8000 AIM Joint Brokers Canaccord Genuity
Limited Henry Fitzgerald-O'Connor +44 20 7023 8000 Macquarie Capital Advisors
Jeffrey Auld +44 20 3037 5639
SOURCE: Bankers Petroleum Ltd.
To view this news release in HTML formatting, please use the following URL:
CO: Bankers Petroleum Ltd.
NI: OIL FIN CONF
-0- Dec/10/2012 13:00 GMT
Press spacebar to pause and continue. Press esc to stop.