Fully Funded US$153Million Capital Program
CALGARY, Jan. 30, 2015 /PRNewswire/ - 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.
SOURCE Bankers Petroleum Ltd.