Bankers Petroleum Operational Update for the First Quarter 2012
Block "F" Exploration Well on Ardenica Structure is Currently Drilling
CALGARY, April 10, 2012 /CNW/ - Bankers Petroleum Ltd. ("Bankers" or the
"Company") (TSX: BNK) (AIM: BNK) is pleased to announce the following first
quarter operational update.
Production and Oil Prices
The average first quarter 2012 production was 14,120 barrels of oil per day
("bopd"), 2% higher than the fourth quarter 2011 rate. Oil sales from the
Patos-Marinza oilfield in Albania during the quarter averaged 13,280 bopd.
The crude oil inventory at March 31st was 312,000 barrels, an increase of
71,000 barrels from December 31st, 2011, accounting for the minimum inventory
increase with expansion of the central treatment facility in the oilfield and
addition of the sales crude pipeline from the oilfield to Fier; both projects
were commissioned during the quarter.
The Patos-Marinza first quarter average oil price was approximately US$84.89
per barrel (representing 72% of the Brent oil price of US$118.49 per barrel),
as compared with the fourth quarter average oil price of US$71.67 per barrel
(66% of Brent oil).
Recent negotiations for spot export crude sales, including one with a large
European refiner, have been priced at 75 to 78% of Brent for 2012 volumes.
Drilling and Well Reactivations Update
Twenty-seven (27) wells have been drilled during the first quarter: twenty-four
(24) horizontal production wells and three (3) water disposal wells. An
additional water disposal well has recently finished drilling and will commence
disposal operations in April. One vertical exploration well is currently
drilling on Block "F". Twenty-two (22) of the horizontal wells have been
completed and are on production.
With the newly expanded water disposal capacity, the Company expects to see
gradual growth in production over the next several quarters by placing on
production several oil wells with high water cuts that were shut-in due to the
limited water capacity and enabling higher drawn-down production to improve oil
rates from several wells.
Reactivation and recompletion work continued in the first quarter with seven
(7) new reactivations and recompletions.
Operations commenced at the Southern Patos cyclic steam pilot in December 2011
with injection into the first horizontal well 5201. The Company placed this
well on production in January and have recovered approximately 150% of cold
water equivalent injected. Optimization of the well is continuing to evaluate
reservoir fluid mobility and oil quality. In addition, the Company recently
started the un-steamed horizontal offset well 5202 on cold production to
establish a base line production level to evaluate incremental gain from
The thermal model has been updated with the most recent core and petrophysical
data, and with the empirical data from the pilot, will be calibrated over the
Exploration Block "F"
The first Block "F" exploration well on the Ardenica structural prospect was
spud on March 29th; it is currently drilling at a depth of 2,000 meters and is
anticipated to reach total depth of 2,030 meters. Following well log evaluation
for indications of hydrocarbon presence, completion and testing operations will
begin in the second quarter.
The first phase of the crude oil sales pipeline, which connects the
Patos-Marinza oilfield to Bankers' storage and loading hub facility at Fier was
completed and commenced operations in January.
The expanded central treatment facility is also complete with the addition of
two new treating trains and commenced operations in January, increasing the
field treating capacity to 25,000 bopd.
The Company drilled three water disposal wells during the quarter and finished
drilling a fourth new disposal well in early April. With these additional wells
and surface facilities infrastructure, the water disposal capacity has been
increased from 30,000 barrels of water per day to in excess of 40,000 barrels
of water per day. This capacity increase was required for ongoing drilling
operations as well as the water control initiatives within the field.
Water injection into well F-38 commenced last year and two offset wells, F34
and F41, were placed on production in December. An additional injector was
added in January of this year to complete the first water-flood pattern.
Water-flood balancing is ongoing.
The Sector III environmental remediation and reclamation project summary report
was completed this quarter. Installation of 130 groundwater monitoring wells in
the field area to assess shallow surface water and soil for impacts from
historical operations has also been completed; final reports are expected by
the third quarter.
The Company has initiated the sludge treatment facility engineering and design
and anticipates having equipment on the ground in the third quarter to commence
larger scale waste sludge treatment in the field area. In addition, planning is
underway for the high temperature thermal desorption unit pilot project to
treat hydrocarbon contaminated soils.
Updated Corporate Presentation
For additional information on this operational update, please see the April
2012 version of the Company's corporate presentation at
The Management of Bankers will host a conference call on April 10, 2012 at 6:
45am MST to discuss this Operations Update. 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
www.bankerspetroleum.com or by entering the following URL into your web browser
http://www.newswire.ca/en/webcast/detail/952037/1019321. 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 April 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 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 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
For further information:
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
Email: [email protected]
Canaccord Genuity Limited
+44 20 7050 6500
AIM JOINT BROKERS:
Canaccord Genuity Limited
Ryan Gaffney/ Henry Fitzgerald-O'Connor
+44 20 7050 6500
Macquarie Capital Advisors
Ben Colegrave/Paul Connolly
+44 20 3037 5639