What retail investors can expect from BNK? Good day friends,
I think BNK has a serious problem in ramping up their production. They have to increse their well numbers to 910 in order to have 30% growth rate. The number of wells are extreamly high. Given that 10% wells are under maintenance, that means about 810 - 815 wells must be operating on any given day. That tells us that avg. well is producing only 17 to 20 boe per day which is very low number in terms of production rate. They have to drill more and more new wells which cost money.
Although in USA some wells produce less than 10 boe per day but TLM and SU has wells which can produce up to 10,000 boe per day. It seems like BNK reservior/geological region has very low reservoir pressure thus oil is not flowing at a good rate. There may be lots of water in that reservoir. But still some of their wells should be able to produce more than 1000 boe per day.
I don't know if thermal or steam injectin will do the trick and they will be able to pump more oil to enhance their production rate.
I am not counting on this company and I don't expect then to do wonders. It seems that someone will come and buy this company at 40 to 50% premium. In march 2012 after the quaterly report, BNK might be trading in low $6 range. If oil prices and economy do good this summer, we can expect an offer this summer somewhere from $10 to $11