Bankers Petroleum Reaches Milestone

Bankers Petroleum provided its first quarter 2010 Financial and Operational Results, together with its Management's Discussion and Analysis.

Abby Badwi, President and Chief Executive Officer, "We are very pleased with the results. 10,000 bopd is a significant milestone in the growth of the Company. With the addition of a second drilling rig in January, the Company doubled its capacity to drill horizontal wells and increase production significantly over the quarter as a result."


  • Oil revenue increased 17% from $30.0 million during the previous quarter to $35.1 million in the first quarter of 2010 as a result of increased production and more favorable oil prices. Sales were $13.1 million for the first quarter of 2009.
  • Production at the end of March 31, 2010 was approximately 9,500 bopd, averaging 8,282 bopd over the first quarter, an increase of 41% compared to the first quarter 2009 average. Current production is in excess of 10,000 bopd. The Company's netback (revenue less royalties, operating, sales and transportation expenses) increased 10% to $20.98/bbl (44% of the average price) compared to $19.01/bbl (42% of the average price) in the fourth quarter of 2009. The netback for the first quarter of 2009 was $4.98/bbl (20% of the average price). The changes in netback were primarily due to more favorable average prices received from export sales and the fluctuation in commodity prices.
  • Funds generated from operations increased to $13.8 million in the first quarter of 2010 from $10.8 million in the fourth quarter of 2009.
  • Capital expenditures were $26.7 million during the quarter, an increase of 55% from the previous quarter spending of $17.2 million, compared to $2.8 million of expenditures in the first quarter of 2009.
  • Operating expenditures decreased to $10.63 per barrel during the quarter from $11.18 per barrel in the previous quarter, primarily due to increased production and efficiencies.
  • Liquidity as of March 31, 2010 saw the company in a position of financial strength, with working capital of $66.0 million and cash of $62.7 million. An additional $15 million was received in April and May 2010. The Company had also drawn $26.4 million from its $139.6 million in available credit facilities.


Throughout the remainder of 2010, the Company will remain focused on achieving its priorities and implementing its capital programs in Albania:

  • In January 2010, a second drilling rig commenced drilling in the Patos-Marinza oilfield and a third rig has now been contracted to start drilling in July 2010. The Company plans to drill a total of 52 horizontal and 5 vertical wells in 2010. Additionally, the Company plans to drill up to 3 vertical wells in Block F in 2010.
  • With the current 10,000 bopd production level and expected production from the remaining horizontal drilling program, Bankers projected 2010 year-end production target is 15,000 bopd.
  • Construction of an additional 80,000 barrels of storage capacity at the Vlore export terminal has commenced and is expected to be ready by year-end. To improve its "off-take" capacity, Bankers has initiated a pipeline project that will be implemented in two phases. Phase one, a 14 kilometer oil pipeline connecting the oilfield by rail to the export terminal, is underway and is expected to supplement current truck transport capacity of 15,000 bopd with an additional 9,500 bopd through rail transport by early 2011. Phase two, a 30 kilometer, 70,000 bopd pipeline connecting the oilfield to the export terminal, is planned for construction starting in 2011.
  • The full collection in April of the $11.8 million outstanding payments owing from the Albanian refineries operated by Albanian Refining & Marketing of Oil Sh.A ("ARMO") has resulted in Bankers resuming oil sales into the domestic market at an equivalent-to-export price.
  • The 2009 year-end independent assessment of the 1.2 billion barrels of Contingent and Prospective resources at Patos-Marinza validates the Company's plans for a thermal pilot proposed for the 2010 capital program. Success of such initiatives may lead to the conversion of significant volumes of these resources to recoverable reserves and the subsequent implementation of a commercial field expansion in 2012 and beyond. A waterflood program is also planned for the Kuçova oilfield in 2010.
  • Bankers expects to fund its $152 million 2010 capital program using funds generated from operations, existing cash resources and a portion of its unutilized $110 million credit facilities.
  • The second quarter 2010 operations update is expected to be released on July 8. The Financial and Operating results for Q2/10 and Q3/10 will be released on August 13, 2010 and November 12, 2010, respectively.