Bankers Petroleum Announces Revised 2015 Capital Budget and Work Program
Fully Funded US$153Million Capital Program
CALGARY, Jan. 30, 2015 /CNW/ - Bankers Petroleum Ltd. ("Bankers" or the
"Company") (TSX: BNK, AIM: BNK) announces its revised 2015 capital program of
US$153 million (all amounts referenced below are in US dollars), reduced from
the previously announced 2015 capital program of $218 million. These
adjustments have been made to ensure 2015 spending fits within funds generated
from operations and cash resources in the latest oil price environment. The
revised budget has been approved by the Company's Board of Directors and will
be submitted to the Albanian authorities for their approval.
David French, President and CEO, commented, "We believe it is prudent with
today's commodity outlook to show capital discipline and preserve our strong
balance sheet. Our project portfolio is flexible enough to allow us to choose
our pace and scale of development as appropriate. This revised budget reflects
our rigorous focus on capital and operating cost efficiency with a balance of
both short term drilling execution and long term flood expansion of the field."
CAPITAL PROGRAM FUNDING
The revised 2015 capital program utilizes a $50 per barrel average annual Brent
oil price forecast in comparison to the budget announced on December 12, 2014,
which was predicated on an annual Brent oil price forecast of $70 per barrel.
The Company expects to fully fund the $153 million capital program with funds
generated from operations and cash resources.
PATOS-MARINZA FIELD
Primary Development
The revised capital program includes $80 million to be spent on the drilling,
completion and associated costs of approximately 60 new horizontal wells. The
number of active drilling rigs will be reduced from three rigs down to two
within 30 days.
Enhanced Oil Recovery: Polymer Flood Expansion
The revised program includes $28 million for the accelerated EOR program. This
program allows for the conversion of up to 20 existing production wells to
polymer injection throughout the year, as well as the associated facilities and
infrastructure to support the acceleration of the EOR program. This represents
a reduction from the 25 - 30 conversions in the previously announced budget.
Facilities, Infrastructure, and Associated Capital
A total of $45 million of the 2015 capital program will be allocated to
facilities and infrastructure activities. Projects include:
* well servicing and work overs;
* flow lining within the field;
* electrification of well pads;
* expansion of water disposal capabilities with one (1) water disposal well;
and
* continuation of environmental remediation and social initiatives.
PRODUCTION GUIDANCE
Based on the revised 2015 capital expenditures, Bankers anticipates its 2015
average production levels will decrease from its average 2014 production levels
by approximately 5% on account of reduced drilling activity and shut-in volumes
due to marginal economics.
FINANCIAL RESILIENCE
Bankers maintains a strong balance sheet with a cash position of approximately
$73 million at December 31, 2014, as well as a hedge which represents 6,000
bopd at $80 per barrel Brent for 2015. Inclusive of the January realization,
the hedge valuation is currently in excess of $60 million. Management will
continue to protect the financial position of the Company with the strategic
view to maintain capital expenditures within 2015 cash flow, supplemented with
cash resources. At December 31, 2014, Bankers had drawn $104 million from its
$224 million credit facilities; no additional draws are anticipated in 2015.
UPDATED CORPORATE PRESENTATION
For additional information on this operational update, please see the Company's
updated January 2015 corporate presentation at www.bankerspetroleum.com.
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.
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; Email:
investorrelations@bankerspetroleum.com; Website: www.bankerspetroleum.com; 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