Free Cash Flow of $9 Million and Q3 Average Production to Date 18,300
bopd
CALGARY, Aug. 14, 2013 /CNW/ - Bankers Petroleum Ltd. ("Bankers" or the
"Company") (TSX: BNK, AIM: BNK) is pleased to provide its 2013 second
quarter financial and operational results. During the quarter, Bankers
achieved its second consecutive quarter of free cash flow and record
production levels.
|
Results at a Glance
|
Three months ended June 30
|
Six months ended June 30
|
|
($000s, except as noted)
|
2013
|
2012
|
% change
|
2013
|
2012
|
% change
|
|
Financial
|
|
|
|
Oil revenue
|
131,838
|
98,587
|
34%
|
264,400
|
201,255
|
31%
|
|
|
Net operating income
|
69,142
|
47,252
|
46%
|
142,307
|
100,723
|
41%
|
|
|
Net income
|
13,024
|
11,253
|
16%
|
27,201
|
19,018
|
43%
|
|
|
|
Per share - basic ($)
|
0.05
|
0.04
|
16%
|
0.11
|
0.08
|
41%
|
|
|
|
- diluted ($)
|
0.05
|
0.04
|
16%
|
0.11
|
0.08
|
43%
|
|
|
Funds generated from operations
|
61,717
|
43,159
|
43%
|
127,136
|
91,231
|
39%
|
| |
|
Per share - basic ($)
|
0.24
|
0.17
|
41%
|
0.50
|
0.36
|
39%
|
|
|
Capital expenditures
|
52,389
|
52,632
|
-
|
99,716
|
115,333
|
(14%)
|
|
Operating
|
|
|
|
Average sales (bopd)
|
18,008
|
14,169
|
27%
|
17,310
|
13,724
|
26%
|
|
|
Average price ($/barrel)
|
80.45
|
76.46
|
5%
|
84.39
|
80.57
|
5%
|
|
|
Netback ($/barrel)
|
42.19
|
36.65
|
15%
|
45.42
|
40.33
|
13%
|
|
|
Average Brent oil price ($/barrel)
|
102.43
|
108.29
|
(5%)
|
107.50
|
113.61
|
(5%)
|
|
|
|
|
June 30, 2013
|
December 31, 2012
|
June 30, 2012
|
|
Cash and deposits
|
33,381
|
38,740
|
60,297
|
|
Working capital
|
116,656
|
88,799
|
112,022
|
|
Total assets
|
918,034
|
825,816
|
770,829
|
|
Long-term debt
|
97,864
|
97,158
|
95,793
|
|
Shareholders' equity
|
519,507
|
483,032
|
454,752
|
Highlights for the quarter and six months ended June 30, 2013 are:
-
Average oil production was 17,886 barrels of oil per day (bopd) for the
three months ended June 30, 2013, 6% higher than 16,919 bopd in the
first quarter of 2013 and 26% higher than 14,161 bopd in the second
quarter of 2012. Average oil production for the third quarter to-date
is approximately 18,300 bopd.
-
Oil sales averaged 18,008 bopd for the second quarter of 2013, an
increase of 8% compared to 16,605 bopd for the previous quarter and an
increase of 27% compared to 14,169 bopd for the second quarter of
2012. For the six months ended June 30, 2013, oil sales were 17,310
bopd, an increase of 26% compared to 13,724 bopd for the comparable
2012 period.
-
For the second quarter of 2013, revenue was $132 million ($80.45/bbl)
compared to $133 million ($88.70/bbl) in the previous quarter and $99
million ($76.46/bbl) in the second quarter of 2012. Revenue for the
second quarter of 2013 represented 79% of the Brent oil price of
$102/bbl, compared to 79% of the Brent oil price of $113/bbl in the
previous quarter and 71% of the Brent oil price of $108/bbl in the
second quarter of 2012.
-
Royalties to the Albanian Government and related entities were $22
million (16% of revenue) for the second quarter of 2013 compared to $17
million (17% of revenue) for the same quarter of 2012. Total royalties
were $45 million (17% of revenue) and $36 million (18% of revenue) for
the six months ended June 30, 2013 and 2012, respectively.
-
For the three and six months periods ended June 30, 2013, operating,
sales and transportation costs, originating from Albanian-based
companies and their employees, were $41 million and $77 million,
respectively, compared to $34 million and $64 million for the
comparable periods of 2012.
-
The Company recorded net operating income (netback) of $69 million
($42.19/bbl) in the second quarter of 2013, compared to $73 million
($48.96/bbl) in the previous quarter and $47 million ($36.65/bbl) in
the second quarter of 2012. Net operating income was $142 million
($45.42/bbl) for the six months ended June 30, 2013, a 41% increase
compared to $101 million ($40.33/bbl) in the comparable 2012 period.
-
For the second quarter of 2013, funds generated from operations were $62
million, compared to $65 million for the previous quarter and $43
million for the same period of 2012.
-
Capital expenditures were $52 million in the second quarter of 2013.
The Company drilled 39 wells during the quarter, comprised of 35
horizontal production wells and four horizontal lateral re-drill wells
in the main area of the Patos-Marinza field. In the second quarter of
2012, capital expenditures were $53 million.
-
The Company continues to maintain a strong financial position at June
30, 2013 with cash of $33 million and working capital of $117 million.
At June 30, 2013, the Company had drawn $115 million of its $230
million approved credit facilities. Working capital for December 31,
2012 and June 30, 2012 was $89 million and $112 million, respectively.
-
Both the International Finance Corporation (IFC) and European Bank for
Reconstruction and Development (EBRD) have approved an extension of the
Company's existing credit facility to September 2020. No repayments
are required until September 2017, from which time the facility amount
will decrease by 25% annually. Collectively, the revolving loan
facilities will increase to $200 million from the existing $100
million. Currently, $120 million is available and the additional $80
million will be available as the Company continues to maintain its
proved and probable reserves base and is conditional upon Brent oil
prices remaining above $70/bbl.
-
The Company was successful in setting aside a separate assessment of
excise tax on its importation and use of diluents. The Courts have
also ruled in favor of the Company for other cases heard, including the
carbon and circulation taxes on diluent imports, which resulted in
assessments to the Company totalling approximately $25 million. The
Company is now preparing to continue its defence at various levels of
appeals.
Outlook
The average third quarter 2013 production to date from the Patos-Marinza
oilfield in Albania is approximately 18,300 bopd, 2% higher than the
second quarter average.
The Company is pleased with performance of the horizontal drilling
program which continues to yield strong results. For the second half
of 2013, the Company will continue to focus on development drilling in
the North-Central areas of the Patos-Marinza field with an estimated 30
horizontal wells per quarter adding to production levels. Two water
disposal wells are planned for late in the third quarter and into the
fourth quarter to provide capacity expansion for growth. In addition,
two (2) to four (4) wells are projected for delineation in the outlying
areas of the field in the fourth quarter.
The expansion of water flood and polymer flood patterns continues with
additional wells to be converted to injection in the second half of
2013. By year-end the Company will have three (3) water-flood patterns
in the upper Marinza reservoir with up to seven (7) injectors and three
(3) polymer-flood patterns in the lower Driza reservoir sands with up
to six (6) injectors in place with response expected in 2014.
In the second half of 2013, the Company will ramp up spending on surface
facilities including the addition of a satellite treatment facility and
tank storage expansion to increase treatment capacity and construction
of flow-lines to reduce trucking within the field where justified.
Drilling of two (2) wells in Kucova is projected in the fourth quarter
of 2013 to test production and collect fluid and reservoir
information. In addition, existing adjacent wells are scheduled for
take-over from Albpetrol for further evaluation.
"I continue to be pleased with the operational success of the company
and our ability to meet or exceed our production guidance for five
consecutive quarters. The Board has now approved the potential
acquisition of a sixth drilling rig which, pending availability, should
enable Bankers to affirm the high-end of our annual guidance. We look
forward to continued reliable, disciplined growth," said David French,
President and CEO of Bankers Petroleum.
|
BANKERS PETROLEUM LTD.
|
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
|
(Unaudited, expressed in thousands of US dollars, except per share
amounts)
|
|
|
|
|
Three months ended
June 30
|
|
Six months ended
June 30
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
131,838
|
$
|
98,587
|
$
|
264,400
|
$
|
201,255
|
|
Royalties
|
|
|
(21,673)
|
|
(17,214)
|
|
(44,991)
|
|
(36,368)
|
|
|
|
|
110,165
|
|
81,373
|
|
219,409
|
|
164,887
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain (loss) on financial commodity contract
|
|
|
(6)
|
|
244
|
|
(1,380)
|
|
(2,965)
|
|
|
|
|
110,159
|
|
81,617
|
|
218,029
|
|
161,922
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
22,291
|
|
19,038
|
|
43,445
|
|
36,470
|
|
Sales and transportation expenses
|
|
|
18,732
|
|
15,083
|
|
33,657
|
|
27,694
|
|
General and administrative expenses
|
|
|
4,513
|
|
3,508
|
|
10,468
|
|
7,618
|
|
Depletion and depreciation
|
|
|
24,438
|
|
14,067
|
|
47,635
|
|
27,744
|
|
Share-based payments
|
|
|
3,103
|
|
1,447
|
|
6,361
|
|
5,683
|
|
|
|
|
73,077
|
|
53,143
|
|
141,566
|
|
105,209
|
|
|
|
|
37,082
|
|
28,474
|
|
76,463
|
|
56,713
|
|
|
|
|
|
|
|
|
|
|
|
|
Net finance expense
|
|
|
3,616
|
|
1,860
|
|
5,556
|
|
4,717
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax
|
|
|
33,466
|
|
26,614
|
|
70,907
|
|
51,996
|
|
Deferred income tax expense
|
|
|
(20,442)
|
|
(15,361)
|
|
(43,706)
|
|
(32,978)
|
|
Net income for the period
|
|
|
13,024
|
|
11,253
|
|
27,201
|
|
19,018
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
Currency translation adjustment
|
|
|
(510)
|
|
(505)
|
|
(862)
|
|
1
|
|
Comprehensive income for the period
|
|
$
|
12,514
|
$
|
10,748
|
$
|
26,339
|
$
|
19,019
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share
|
|
$
|
0.051
|
$
|
0.044
|
$
|
0.107
|
$
|
0.076
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share
|
|
$
|
0.051
|
$
|
0.044
|
$
|
0.107
|
$
|
0.075
|
|
BANKERS PETROLEUM LTD.
|
|
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
|
|
(Unaudited, expressed in thousands of US dollars)
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
June 30
2013
|
|
December 31
2012
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
$
|
26,272
|
$
|
33,740
|
|
|
Restricted cash
|
|
|
|
|
|
7,109
|
|
5,000
|
|
|
Accounts receivable
|
|
|
|
|
|
59,399
|
|
35,603
|
|
|
Inventory
|
|
|
|
|
|
34,423
|
|
23,517
|
|
|
Deposits and prepaid expenses
|
|
|
|
|
|
40,215
|
|
30,265
|
|
|
Financial commodity contract
|
|
|
|
|
|
170
|
|
1,550
|
|
|
|
|
|
|
|
167,588
|
|
129,675
|
|
Non-current assets
|
|
|
|
|
|
|
|
|
|
|
Long-term receivable
|
|
|
|
|
|
10,261
|
|
11,150
|
|
|
Property, plant and equipment
|
|
|
|
|
|
735,912
|
|
681,399
|
|
|
Exploration and evaluation assets
|
|
|
|
|
|
4,273
|
|
3,592
|
|
|
|
|
|
|
$
|
918,034
|
$
|
825,816
|
|
|
|
LIABILITIES
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
|
|
|
$
|
40,022
|
$
|
38,787
|
|
|
Current portion of long-term debt
|
|
|
|
|
|
10,910
|
|
2,089
|
|
|
|
|
|
|
|
50,932
|
|
40,876
|
|
Non-current liabilities
|
|
|
|
|
|
|
|
|
|
|
Long-term debt
|
|
|
|
|
|
97,864
|
|
97,158
|
|
|
Decommissioning obligation
|
|
|
|
|
|
18,022
|
|
16,747
|
|
|
Deferred tax liabilities
|
|
|
|
|
|
231,709
|
|
188,003
|
|
|
|
|
|
|
|
398,527
|
|
342,784
|
|
|
|
SHAREHOLDERS' EQUITY
|
|
Share capital
|
|
|
|
|
|
337,148
|
|
334,764
|
|
Contributed surplus
|
|
|
|
|
|
77,187
|
|
69,435
|
|
Currency translation reserve
|
|
|
|
|
|
6,500
|
|
7,362
|
|
Retained earnings
|
|
|
|
|
|
98,672
|
|
71,471
|
|
|
|
|
|
|
|
519,507
|
|
483,032
|
|
|
|
|
|
|
$
|
918,034
|
$
|
825,816
|
|
BANKERS PETROLEUM LTD.
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(Unaudited, expressed in thousands of US dollars)
|
|
|
|
Three months ended
June 30
|
|
Six months ended
June 30
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
Cash provided by (used in):
|
|
|
|
|
|
|
|
|
|
|
Operating activities
|
|
|
|
|
|
|
|
|
|
|
Net income for the period
|
|
$
|
13,024
|
$
|
11,253
|
$
|
27,201
|
$
|
19,018
|
|
Depletion and depreciation
|
|
|
24,438
|
|
14,067
|
|
47,635
|
|
27,744
|
|
Accretion of long-term debt
|
|
|
829
|
|
1,199
|
|
1,978
|
|
2,326
|
|
Accretion of decommissioning obligation
|
|
|
250
|
|
202
|
|
491
|
|
397
|
|
Unrealized foreign exchange (gain) loss
|
|
|
(268)
|
|
(126)
|
|
(448)
|
|
120
|
|
Deferred income tax expense
|
|
|
20,442
|
|
15,361
|
|
43,706
|
|
32,978
|
|
Share-based payments
|
|
|
3,103
|
|
1,447
|
|
6,361
|
|
5,683
|
|
Unwinding of discount of long-term receivable
|
|
|
(700)
|
|
-
|
|
(1,441)
|
|
-
|
|
Revaluation loss of long-term receivable
|
|
|
593
|
|
-
|
|
273
|
|
-
|
|
Unrealized (gain) loss on financial commodity contract
|
|
|
6
|
|
(244)
|
|
1,380
|
|
2,965
|
|
|
|
|
61,717
|
|
43,159
|
|
127,136
|
|
91,231
|
|
Change in long-term receivable
|
|
|
202
|
|
-
|
|
2,057
|
|
-
|
|
Change in non-cash working capital
|
|
|
(7,137)
|
|
(6,775)
|
|
(44,949)
|
|
(12,614)
|
|
|
|
|
54,782
|
|
36,384
|
|
84,244
|
|
78,617
|
|
Investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additions to property, plant and equipment
|
|
|
(51,842)
|
|
(51,306)
|
|
(99,035)
|
|
(113,451)
|
|
Additions to exploration and evaluation assets
|
|
|
(547)
|
|
(1,326)
|
|
(681)
|
|
(1,882)
|
|
Restricted cash
|
|
|
(2,109)
|
|
-
|
|
(2,109)
|
|
-
|
|
Change in non-cash working capital
|
|
|
968
|
|
(3,467)
|
|
1,532
|
|
(4,109)
|
|
|
|
|
(53,530)
|
|
(56,099)
|
|
(100,293)
|
|
(119,442)
|
|
Financing activities
|
|
|
|
|
|
|
|
|
|
|
Issue of shares for cash
|
|
|
1,309
|
|
31
|
|
1,410
|
|
12,177
|
|
Financing costs
|
|
|
(1,994)
|
|
-
|
|
(1,994)
|
|
(750)
|
|
Change in long-term debt
|
|
|
(9,136)
|
|
2,993
|
|
9,201
|
|
35,817
|
|
|
|
|
(9,821)
|
|
3,024
|
|
8,617
|
|
47,244
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign exchange loss on cash and cash
|
|
|
|
|
|
|
|
|
|
|
equivalents
|
|
|
(6)
|
|
(162)
|
|
(36)
|
|
(135)
|
|
Increase (decrease) in cash and cash equivalents
|
|
|
(8,575)
|
|
(16,853)
|
|
(7,468)
|
|
6,284
|
|
Cash and cash equivalents, beginning of period
|
|
|
34,847
|
|
72,150
|
|
33,740
|
|
49,013
|
|
Cash and cash equivalents, end of period
|
|
$
|
26,272
|
$
|
55,297
|
$
|
26,272
|
$
|
55,297
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest paid
|
|
$
|
2,566
|
$
|
1,521
|
$
|
2,788
|
$
|
1,722
|
|
Interest received
|
|
$
|
73
|
$
|
218
|
$
|
118
|
$
|
278
|
Supporting Documents
The full Management Discussion and Analysis (MD&A), Financial Statements
and updated March corporate presentation are available on www.bankerspetroleum.com. The MD&A and Financial Statements will also be available on www.sedar.com.
Updated Corporate Presentation
For additional information on this operational update, please see the
August 2013 version of the Company's corporate presentation at www.bankerspetroleum.com.
---------
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 reactivations and well
recompletions of the past will continue and success rates and
production rates will be similar to those rates experienced for
previous well recompletions and reactivations; 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.
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 BNK.
SOURCE Bankers Petroleum Ltd.
