BNK.L Regulatory News (BNK)

Bankers Petroleum Operational Update for the Third Quarter 2014 Six Percent Production Growth and Record Number of Wells Drilled in the ThirdQuarter CALGARY, Oct. 6, 2014 /CNW/ - Bankers Petroleum Ltd. (Bankers or the Company)(TSX: BNK, AIM: BNK) is pleased to announce the Company's third quarteroperational update. Production, Sales and Oil Prices Average production from the Patos-Marinza oilfield in Albania for the thirdquarter of 2014 was 21,865 barrels of oil per day (bopd), 6.0% higher than20,630 bopd in the second quarter of 2014. Record high oil sales during the quarter averaged 22,003 bopd, 1.7% higher thanthe previous quarter average of 21,627 bopd. On a year to date basis for thefirst three quarters of 2014, the sales averaged 20,701 bopd, 13.9% higher thanthe average sales in 2013. Crude oil inventory at September 30, 2014, decreased3.2% to 342,500 barrels, 11,500 barrels lower than 354,000 barrels at June 30,2014. The Patos-Marinza third quarter average oil price was approximately $78.66 perbarrel (representing 77% of the Brent oil price of $101.85 per barrel), ascompared with the second quarter average oil price of $86.68 per barrel(representing 79% of the Brent oil price of $109.63 per barrel). Crude sales tothe export market during the third quarter made up the majority at 72% of thetotal sales (net of in-kind royalties) at an average export pricing of 80% ofthe Brent oil price. Renewal of delivery of crude oil to the domestic refinery on a temporary basis In August, Bankers commenced delivery of crude oil to the domestic refiner,ARMO, under new ownership and management. The temporary contract enables therestart of the refinery to test the commercial viability of the refinerysystem. Bankers agreed to sell on a monthly basis not to exceed 6 months to anaffiliate of ARMO at 73% of Brent (FOB Vlore equivalent) plus $40/tonne orapproximately $6/bbl recovery against an existing accounts receivable balance.All sales are fully secured by letters of credit. More information on theimpact of these repayments will be available with the third quarter financials. No determination has been made on volumes to be available for domestic use in2015. The Company is in the process of reviewing its sales contracts for the2015 calendar year and volume commitments for next year will be determined overthe next few months. Drilling Update A record forty-five (45) wells were drilled and rig released during the thirdquarter in the main area of the Patos-Marinza oilfield: forty-four (44)horizontal production wells and the Company's first multi-lateral well.Thirty-five (35) of these wells were completed and are on production with theremaining ten (10) to be placed on production in October pending drilling rigmove off the pad, well completions and facilities tie-in. Initial Multi-Lateral Well Results Bankers drilled its first pilot multi-lateral well with dual legs into theGorani formation in August and placed the well on initial clean-up andevaluation on August 24th. The well has been tested for over 30 days reachingan average rate of more than 200 bopd. The Company is very encouraged by the early-stage performance of the duallaterals and will continue to produce the well on extended test and evaluatethe mechanical integrity and lateral accessibility over the next few months.This adds another tool to our drilling program, which will enable us to targetlocations with heavy oil mobility concerns and thinner pay zones to expand ourdevelopment and improve recovery at good capital efficiency. Additionalmulti-lateral equipment is being procured for 2015. Secondary Recovery Program The polymer flood and water flood patterns in the Patos Marinza oilfieldcontinue to perform better than expected and deliver positive response from theeighteen (18) polymer and three (3) water flood patterns installed at the endof the third quarter. Reservoir pressure and production response are rising andabove current projection models with injection performance achieving targetrates indicative of good reservoir conformance. Nine (9) wells were converted to polymer injection in the third quarter. Three(3) injectors expanded the Lower Driza patterns in the southern region of themain field and six (6) injectors were installed in a new area in the centralregion of the main field where the reservoir and fluid properties are amenableto polymer flooding with thick pay zones. This completes the conversion programplanned for this year ahead of schedule. To-date, Bankers has implemented three (3) water flood injectors in the UpperMarinza zone (M0 reservoir sand) in the central region, twelve (12) polymerflood injectors in Lower Driza zones spread evenly between the D5, D4, and D3reservoir sands in the southern region, and six (6) polymer injectors spreadevenly in the three Lower Driza zones in the central region of the main PatosMarinza field. The Company is very encouraged by the potential of polymer flooding additionalpatterns in Patos Marinza and are moving forward with procuring dry polymerchemical, mixing equipment and pumping skids to support further expansion ofthe program in 2015. Infrastructure Development In the third quarter, thirty (30) wells were electrified in the northern andcentral areas of the Patos-Marinza oilfield in accordance with our strategy toreduce energy costs. The electrification program will be accelerated in thefourth quarter with plans to electrify sixty (60) to seventy-five (75)additional wells. Emulsion gathering projects in the northern and western areas of the main fieldare progressing with engineering plans completed and equipment ordered. Bothprojects are on track to be completed in the first half of 2015 and willsignificantly reduce the in-field trucked volumes and reduce operating costsover the next year. Bankers remains focused on key infrastructure projects aimed at reducing costsand optimizing operations including the gas gathering system, new inventorystorage yard, emulsion treating, and sour treatment facilities. Updated Corporate Presentation For additional information on this Operational Update please see the Company'sOctober 2014 corporate presentation at www.bankerspetroleum.com. Conference Call The Management of Bankers will host a conference call on October 6, 2014, at 6:30 am MDT to discuss this Operational Update. Following Management'spresentation there will be a question and answer session for analysts andinvestors. To participate in the conference call, please contact the conference operatorten minutes prior to the call at 1-888-231-8191 or 1-647-427-7450. A live audioweb cast of the conference call will also be available on Bankers website atwww.bankerspetroleum.com or by entering the following URL into your webbrowser, http://www.newswire.ca/en/webcast/detail/1416110/1572802. 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 availableuntil December 10, 2014 by dialing 1-855-859-2056 or 1-416-849-0833 andentering access code 10317494. Caution Regarding Forward-looking Information Information in this news release respecting matters such as the expected futureproduction levels from wells, future prices and netback, work plans,anticipated total oil recovery of the Patos-Marinza and Kuçova oilfieldsconstitute forward-looking information. Statements containing forward-lookinginformation express, as at the date of this news release, the Company's plans,estimates, forecasts, projections, expectations, or beliefs as to future eventsor results and are believed to be reasonable based on information currentlyavailable to the Company. Exploration for oil is a speculative business that involves a high degree ofrisk. The Company's expectations for its Albanian operations and plans aresubject to a number of risks in addition to those inherent in oil productionoperations, including: that Brent oil prices could fall resulting in reducedreturns and a change in the economics of the project; availability offinancing; delays associated with equipment procurement, equipment failure andthe lack of suitably qualified personnel; the inherent uncertainty in theestimation of reserves; exports from Albania being disrupted due to unplanneddisruptions; and changes in the political or economic environment. Production and netback forecasts are based on a number of assumptions includingthat the rate and cost of well takeovers, well reactivations and wellrecompletions of the past will continue and success rates will be similar tothose rates experienced for previous well recompletions/reactivations/development; that further wells taken over and recompleted will produce atrates similar to the average rate of production achieved from wellsrecompletions/reactivations/development in the past; continued availability ofthe necessary equipment, personnel and financial resources to sustain theCompany's planned work program; continued political and economic stability inAlbania; the existence of reserves as expected; the continued release byAlbpetrol of areas and wells pursuant to the Plan of Development and Addendum;the absence of unplanned disruptions; the ability of the Company tosuccessfully drill new wells and bring production to market; and general risksinherent in oil and gas operations. Forward-looking statements and information are based on assumptions thatfinancing, equipment and personnel will be available when required and onreasonable terms, none of which are assured and are subject to a number ofother risks and uncertainties described under "Risk Factors" in the Company'sAnnual Information Form and Management's Discussion and Analysis, which areavailable on SEDAR under the Company's profile at www.sedar.com. There can be no assurance that forward-looking statements will prove to beaccurate. Actual results and future events could differ materially from thoseanticipated in such statements. Readers should not place undue reliance onforward-looking information and forward looking statements. Review by Qualified Person This release was reviewed by Suneel Gupta, Executive Vice President and ChiefOperating Officer of Bankers Petroleum Ltd., who is a "qualified person" underthe rules and policies of AIM in his role with the Company and due to histraining as a professional petroleum engineer (member of APEGA) with over 20years' experience in domestic and international oil and gas operations. About Bankers Petroleum Ltd. Bankers Petroleum Ltd. is a Canadian-based oil and gas exploration andproduction company focused on developing large oil and gas reserves. InAlbania, Bankers operates and has the full rights to develop the Patos-Marinzaheavy oilfield, has a 100% interest in the Kuçova oilfield, and a 100% interestin Exploration Block "F". Bankers' shares are traded on the Toronto StockExchange and the AIM Market in London, England under the stock symbol BNK. SOURCE: Bankers Petroleum Ltd. For further information: David FrenchPresident and Chief Executive Officer(403) 513-6930 Doug UrchExecutive VP, Finance and Chief Financial Officer(403) 513-2691 Laura BechtelInvestor Relations Analyst(403) 513-3428 Email: investorrelations@bankerspetroleum.comWebsite: www.bankerspetroleum.com AIM NOMAD:Canaccord Genuity LimitedHenry Fitzgerald-O'Connor+44 0 207 523 8000 AIM BROKER:FirstEnergy Capital LLPHugh Sanderson / David van Erp+44 0 207 448 0200

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