Bankers Petroleum Announces 2013 Financial Results

 $45 Million Free Cash Flow and 23% Increase in Oil Sales  CALGARY, March 13, 2014 /CNW/ - Bankers Petroleum Ltd. ("Bankers" or the  "Company") (TSX: BNK) (AIM: BNK) is pleased to provide its 2013 financial  results.  In 2013, Bankers attained several key accomplishments including its first year  of free cash flow, record oil production and sales.  The Company invested $234  million in capital expenditures during 2013. All amounts listed below are in  US dollars unless otherwise stated.                                                                             Results at a Glance                                                                                                                       ($000s, except as noted)                      Year ended December 31     Results at a Glance                           2013      2012      2011     Financial                                                                    Oil revenue                              566,386   432,138   339,918       Net operating income                     316,558   218,246   169,653       Net income                                61,743    34,413    35,996         Per share - basic (US$)                   0.24      0.14      0.15                   - diluted (US$)                 0.24      0.14      0.14       Funds generated from operations          279,601   192,589   147,940         Per share - basic (US$)                   1.10      0.76      0.60       Capital expenditures                     234,243   222,663   242,754     Operating                                                                    Average sales (bopd)                      18,173    14,808    12,784       Average Brent oil price ($/barrel)        108.66    111.67    111.26       Average realized price ($/barrel)          85.39     79.73     72.84       Netback ($/barrel)                         47.73     40.27     36.36                                                                                                                                      December 31                                                   2013      2012      2011     Cash and deposits                           31,706    38,740    54,013     Working capital                            134,094    88,799    80,282     Total assets                             1,007,148   825,816   661,216     Long-term debt                              98,150    97,158    46,692     Shareholders' equity                       564,675   483,032   412,679  Highlights  Bankers made several key financial and operational achievements during 2013:  Financial Highlights         --  In 2013, revenue increased by 31% to $566 million ($85.39/bbl)             from $432 million ($79.73/bbl) in 2012.  Field price             realization represented 79% of the Brent oil benchmark price             ($108.66/bbl) as compared to 71% of the Brent price             ($111.67/bbl) in 2012.         --  Royalties to the Albanian Government and related entities were             $94 million (17% of revenue) compared to $78 million (18% of             revenue) for 2012.         --  Funds generated from operations were $280 million, a 45%             increase compared to $193 million for 2012.  2013 represents             the first year that funds generated from operations exceeded             annual capital expenditures of $234 million.         --  The Company continues to maintain a strong financial position             at December 31, 2013 with cash of $32 million and working             capital of $134 million.  Cash and working capital at December             31, 2012 was $39 million and $89 million, respectively.         --  In May 2013, both the International Finance Corporation (IFC)             and European Bank for Reconstruction and Development (EBRD)             approved an extension of the Company's existing credit facility             to September 2020.  No repayments are required until September             2017, from which time the facility amount will decrease by 25%             annually.  Collectively, the revolving loan facilities have             increased to $200 million from $100 million at year-end 2012.         --  In July 2013, the Company entered into financial commodity             contracts representing 6,000 bopd at a floor price of $80/bbl             Brent for 2014.  Primary Drilling Program Highlights         --  Average oil production from the Patos-Marinza oilfield was             18,169 barrels of oil per day (bopd) in 2013, 21% higher than             the 2012 average production of 15,020 bopd.  Average oil             production for the first quarter of 2014 to-date is             approximately 19,800 bopd.         --  Oil sales averaged 18,173 bopd compared to 14,808 bopd in 2012,             an increase of 23%, primarily as a result of the Company's             ongoing horizontal drilling and recompletion programs, focused             on bringing high productivity wells on stream.         --  Capital expenditures were $234 million compared to $223 million             in 2012.  A total of 146 wells were drilled, including 135             horizontal production wells and 10 lateral re-drills in the             Patos-Marinza field, plus one exploration well in Block "F".  A             total of 128 wells were drilled in 2012.  Expansion of Product Margin Highlights         --  Operating and sales and transportation costs, originating from             Albanian-based companies and their employees, were $156 million             ($23.44/bbl) compared to $136 million for 2012 ($25.00/bbl).         --  For the year ended December 31, 2013, the Company recorded net             operating income (netback) of $317 million ($47.73/bbl), an             increase of 45% compared to $218 million ($40.27/bbl) in 2012.         --  The average realized price in 2013 for Patos-Marinza crude oil             was 79% of the Brent oil benchmark, an increase of 11% over the             2012 oil price of 71% of Brent.         --  The Company continued to focus on key infrastructure projects             aimed at reducing cost and optimizing operations in the field,             including maintenance turnaround of major treating facilities.              Several cascade tank systems on individual well pads have been             completed and both a new sludge handling and satellite treating             facility are in the final stages of construction and will             commence operation in 2014.  Additional work on flow-lines,             sour treatment facilities and cascade systems continue.              Optimization of the treating process has significantly reduced             the diluent blend and has improved the sales specification of             the crude oil.         --  The technical review, including route selection, surface land             access and social and environmental impact assessments for the             second phase of the crude oil pipeline from the Fier Hub to the             export terminal at Vlore is underway.  Expansion of the             Petrolifera Italo Albanese (PIA) Vlore Terminal is under design             for additional storage and shipping channel dredging.  Other Highlights in 2013         --  In 2013, Bankers invested $6 million in environmental and             social initiatives; the Company has invested over $20 million             in environmental and social initiatives since 2009.         --  The Oil Initially in Place (OIIP) resource assessment in             Albania at year-end was 5.4 billion barrels, consistent with             the OIIP at the end of 2012.  Reserves on a proved basis were             147 million barrels, 5% higher than 139 million barrels at             year-end 2012.  On a proved plus probable basis, reserves were             232 million barrels, an increase of 3% compared to 226 million             barrels at year-end 2012.  The corresponding net present value             (NPV) after tax (discounted at 10%) of the proved plus probable             reserves increased by 20% to $2.2 billion at year-end compared             to $1.9 billion in 2012.         --  The Company continues Enhanced Oil Recovery (EOR) techniques,             monitoring and expanding on its water flood and polymer flood             patterns.  Initial production response in the Lower Driza (D5             reservoir sand) is expected in the first half of 2014, as the             first two polymer injectors commenced in this zone early 2013.              Injection performance has been maintained at target rates with             no premature breakthrough of fluids to offset producers, which             is indicative of good reservoir conformance.  Reservoir             pressure is rising and is following current projection models.              During 2013, Bankers implemented three water flood injectors in             the Upper Marinza and five polymer flood injectors in three             separate Lower Driza reservoir sands in the core area of the             Patos-Marinza field.  Further plans to convert up to 14             additional wells for polymer and water injection are underway             in 2014.         --  Block "F" contains several seismically defined structural and             amplitude anomalies prospective for oil and natural gas.  The             second exploration well was drilled in 2013, completing the             Company's two well obligation on the block.  The well reached a             total depth of 2,776 meters, however petrophysical and             geological information indicated that the well did not             encounter any hydrocarbon bearing zones that would merit             testing and was suspended.  Technical evaluation of the block             will continue and Bankers is reviewing several other prospects             including a 3D seismic program in 2014.  Appointment of David French to the Board of Directors  Bankers is pleased to announce the appointment of David French, President and  Chief Executive Officer (CEO) of Bankers Petroleum, to its Board of Directors,  effective immediately.  Mr. French joined Bankers as President and CEO a year ago and has led the  Company to reach several milestones in that time, including record production,  free cash flow and operational efficiency improvements. Mr. French continues  to lead the Company with a disciplined approach to delivering consistent,  reliable growth to its shareholders.  Robert Cross, Chairman of the Board commented "Mr. French's wide range of  international oil and gas experience and direct insight into the Company will  be a valuable asset to the Board.  His strong leadership skills and  relationships in the investment community will continue to have a positive and  driving influence on the performance of the Company for many years to come".  First Quarter Operational Update  First quarter 2014 year-to-date average production is 19,800 bopd.  Bankers  intends to issue the first quarter 2014 operational update and host a  conference call on Tuesday, April 8, 2014.  Outlook  The Company's capital program in 2014 will be $313 million, funded from  projected cash flow and existing cash based on an average $100 per barrel  Brent oil price. The work program and budget will include the following:         --  Drilling of 150 - 170 horizontal and vertical wells with 80 -             90% of the wells focused on increasing production and 10 - 20%             focused on delineation and data collection for improved             development and recovery performance in the Patos-Marinza             oilfield.         --  Expansion of the water flood and polymer flood programs with             the addition of up to 14 conversions as well as testing and             evaluation of the existing patterns implemented in 2013.         --  Continued focus on operational efficiencies in the field to             expand product margins including gas gathering, emulsion             flow-lines, satellite treating facilities, storage tanks, and             field electrification.         --  Continued management of offset existing wellbores for             observation, water control, and suspension as well as expanding             the water disposal system to manage the increased development.         --  Planning and design of sales infrastructure expansion on the             second phase crude oil pipeline from the Fier Hub facilities to             the Vlore Port and increased storage and shipping channel             dredging at the port.         --  Drilling of two horizontal wells at the Kuçova oilfield and             reactivation of existing vertical wells.         --  Acquisition of 100 km2 of 3D seismic with 20 km2 on Block "F"             to further evaluate prospects as part of the second exploration             phase on the block and 80 km2 in the central and northern             region of the Patos-Marinza field to further determine the             deeper and extension potential of the field.         --  Investment of $7 million on environmental remediation and             social initiatives as part of a sustained long-term effort to             improve the physical environment, along with training programs             and other community initiatives for the residents near the             Company's operations.   Supporting Documents  The full Management Discussion and Analysis (MD&A), Financial Statements and  updated March corporate presentation are available on The MD&A and Financial Statements will also be  available on                                               BANKERS PETROLEUM LTD.                       CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME                                   FOR THE YEARS ENDED DECEMBER 31          (Expressed in thousands of US dollars, except per share amounts)                                                                                                                                        2013        2012                                                                                Revenues                                         $  566,386 $  432,138     Royalties                                          (94,294)   (78,361)                                                         472,092    353,777     Realized loss on financial commodity contracts      (3,898)    (6,588)     Unrealized gain (loss) on financial commodity       (1,555)        556     contracts                                                         466,639    347,745                                                                                Operating expenses                                   88,510     77,953     Sales and transportation expenses                    67,024     57,578     General and administrative expenses                  21,363     16,050     Depletion and depreciation                           99,554     65,937     Share-based compensation                             11,527     11,205                                                         287,978    228,723                                                         178,661   119,022                                                                                Net finance expense                                  18,712     19,594                                                                                Income before income tax                            159,949     99,428     Deferred income tax expense                        (98,206)   (65,015)     Net income for the year                              61,743     34,413                                                                                Other comprehensive income (loss)                                          Currency translation adjustment                     (1,017)        953     Comprehensive income for the year                $   60,726 $   35,366                                                                                Basic earnings per share                         $    0.243 $   0.136                                                                         Diluted earnings per share                       $    0.241 $    0.136                                                                                                                       BANKERS PETROLEUM LTD.                    CONSOLIDATED STATEMENTS OF FINANCIAL POSITION                                         AS AT DECEMBER 31                          (Expressed in thousands of US dollars)                                                        ASSETS                                                  2013            2012     Current assets                                                          Cash and cash equivalents             $    24,597     $  33,740       Restricted cash                             7,109         5,000       Accounts receivable                        53,981        35,603       Inventory                                  38,025        23,517       Deposits and prepaid expenses              44,956        30,265       Financial commodity contracts                 734         1,550                                                 169,402       129,675     Non-current assets                                                      Long-term receivable                        7,019        11,150       Property, plant and equipment             823,908       681,399       Exploration and evaluation assets           6,819         3,592                                             $ 1,007,148     $ 825,816                                                     LIABILITIES     Current liabilities                                                     Accounts payable and accrued          $    33,812     $  38,787       liabilities       Current portion of long-term debt           1,496         2,089                                                  35,308        40,876     Non-current liabilities                                                 Long-term debt                             98,150        97,158       Decommissioning obligation                 22,806        16,747       Deferred tax liabilities                  286,209       188,003                                                 442,473       342,784                                             SHAREHOLDERS' EQUITY     Share capital                               340,305       334,764     Contributed surplus                          84,811        69,435     Currency translation reserve                  6,345         7,362     Retained earnings                           133,214        71,471                                                 564,675       483,032                                             $ 1,007,148     $ 825,816                                                                                                                                                                                     BANKERS PETROLEUM LTD.                              CONSOLIDATED STATEMENTS OF CASH FLOWS                                   FOR THE YEARS ENDED DECEMBER 31                             (Expressed in thousands of US dollars)                                                                                                                                      2013          2012     Cash provided by (used in):                                                 Operating activities                                                          Net income for the year                     $    61,743   $    34,413       Depletion and depreciation                       99,554        65,937       Accretion of long-term debt                       2,805         4,791       Accretion of decommissioning obligation           1,019           829       Unrealized foreign exchange (gain) loss           (756)           636       Deferred income tax expense                      98,206        65,015       Share-based compensation                         11,527        11,205       Discount and revaluation of long-term                             receivable                                        4,687         7,629       Realized loss on financial commodity                              contracts                                         3,898         6,588       Unrealized (gain) loss on financial                               commodity contracts                               1,555         (556)       Cash premiums paid for financial                                  commodity contracts                             (4,637)       (3,898)                                                       279,601       192,589       Change in long-term receivable                    (556)      (18,779)       Change in non-cash working capital             (54,403)      (12,064)                                                       224,642       161,746     Investing activities                                                          Additions to property, plant and                                  equipment                                     (231,016)     (220,525)       Additions to exploration and evaluation                           assets                                          (3,227)       (2,138)       Restricted cash                                 (2,109)             -       Change in non-cash working capital                1,851       (2,762)                                                     (234,501)     (225,425)     Financing activities                                                          Issue of shares for cash                          3,332        13,555       Financing costs                                 (1,994)         (750)       Change in long-term debt                          (813)        35,537                                                           525        48,342     Foreign exchange gain on cash and cash                191         equivalents                                                          64     Decrease in cash and cash equivalents             (9,143)      (15,273)     Cash and cash equivalents, beginning of            33,740         year                                                             49,013     Cash and cash equivalents, end of year        $    24,597   $    33,740                                                                                 Interest paid                                 $     5,811   $     4,788     Interest received                             $       159   $       438                                                                                                                                                                                                           BANKERS PETROLEUM LTD.                                                 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY                             (Expressed in thousands of US dollars, except number of common shares)                     Number of                                           Currency                      common        Share                 Contributed   translation   Retained                      shares       capital    Warrants      surplus       reserve     earnings      Total                                                                                                                                                                                                                  Balance at     247,697,769   $ 318,021   $   1,540   $    49,651   $     6,409   $  37,058 $ 412,679     December 31,     2011                                                                                                              Share-based              -           -           -        21,432             -           -    21,432     compensation     Options          1,457,890       4,147           -       (1,655)             -           -     2,492     exercised     Warrants         4,672,991      12,596     (1,533)             -             -           -    11,063     exercised     Warrants                 -           -         (7)             7             -           -         -     expired     Net income               -           -           -             -             -      34,413    34,413     for the year     Currency                 -           -           -             -           953           -       953     translation     adjustment                                                                                                        Balance at     253,828,650   $ 334,764   $       -   $    69,435   $     7,362   $  71,471 $ 483,032     December 31,     2012                                                                                                              Share-based              -           -           -        17,585             -           -    17,585     compensation     Options          1,853,261       5,541           -       (2,209)             -           -     3,332     exercised     Net income               -           -           -             -             -      61,743    61,743     for the year     Currency                 -           -           -             -       (1,017)           -   (1,017)     translation     adjustment                                                                                                        Balance at     255,681,911     340,305           -   $    84,811   $     6,345   $ 133,214 $ 564,675     December 31,                 $           $     2013                                                                                                                                                                                                        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  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.  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, 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  BNK.    SOURCE  Bankers Petroleum Ltd.  David French President and Chief Executive Officer (403) 513-6930   Doug Urch Executive VP, Finance and Chief Financial Officer (403) 513-2691  Laura Bechtel Investor Relations Analyst (403) 513-3428  AIM NOMAD: Canaccord Genuity Limited Henry Fitzgerald-O'Connor +44 0 207 523  8000  AIM BROKER: FirstEnergy Capital LLP Hugh Sanderson / David van Erp +44 0 207  448 0200  To view this news release in HTML formatting, please use the following URL:  CO: Bankers Petroleum Ltd. ST: Alberta NI: OIL ERN  
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