BNK.L Regulatory News (BNK)

29 Jun 2006 07:00

Bankers Petroleum Increases Albanian 2006 Production Target to 4,200 Bopd Development Advances Due to Recompletion Success CALGARY, June 28 /CNW/ - Bankers Petroleum Ltd. (TSX: BNK, AIM: BNK) ispleased to provide an update on its ongoing development in Albania, which hasresulted in strong production increases and a revision to 2006 targets. TheCompany's Albanian strategy for 2006 is focused on continuing to buildproduction through the effective take-over and redevelopment of wells fromAlbpetrol Sh.A. Bankers has taken over 50 wells since the beginning of the year and workis proceeding on further engineering and land acquisition for facilities in2007. Of the 50 wells taken over, over 35 wells have been placed onproduction, increasing current production 50% to approximately 3,450 bopd from2,302 bopd at December 31, 2005. Based on the success and production to date,Bankers is revising its 2006 projected exit production rate to approximately4,200 bopd from 3,800 bopd. "Albania continues to provide substantial growth for the Company,supplying a solid backbone for the Company," said Richard Wadsworth,President. "Our activities this year have increased current production toapproximately 3,450 bopd. As a result of our success, we're well positioned toexceed our previous production targets and increase cash flow for the year." Higher production combined with export sales prices will increase cashflow for 2006. Bankers' exposure to possible downturns in crude oil prices ismitigated by its two sales contracts. The local Albanian sales contractincorporates ceiling and floor prices determined by a formula which isreferenced to the price of Brent crude oil. The export contract is directlylinked to Brent prices, however, based on current formula and export volumes,the Brent price would need to fall below US$55 per barrel Brent beforeimpacting the Company's budgeted revenue for 2006. Brent crude price iscurrently trading at over US$70 per barrel. The recent revision to Bankers' 2005 reserve report (National Instrument51-101F1) had no changes affecting the previously reported reserve quantitiesand the associated economic values. The proved plus probable reserves wereestimated by independent engineers at 88 million barrels (net of royalties),which are valued at US$290.5. This is based on constant price and costassumptions on an after-tax basis, using a discount rate of 10%. Bankers is committed to its operations and growth in Albania. Throughreinvestment in the country, the Company is working towards the long-termfuture of the project and the community in Albania. --------------------------------------- About Bankers Petroleum Ltd. Bankers Petroleum Ltd. is a Canadian-based oil and gas exploration and production company focused on opportunities in unconventional petroleumassets. Bankers holds interests in four prospects in the Northern and Centralregions of the United States, where it is currently pursuing the explorationof shale gas plays. It also operates in the Patos-Marinza oilfield in Albaniapursuant to a license agreement, producing heavy oil. Bankers shares aretraded on the Toronto Stock Exchange and the AIM Market in London, Englandunder the ticker symbol BNK. Caution Regarding Forward-looking Information Certain information in this news release respecting the Company, andanticipated production and cash flow from Albania operations constitutesforward-looking information. Statements containing forward-looking informationexpress, as at the date of this news release, the Company's plans, estimates,forecasts, projections, expectations, or beliefs as to future events orresults and the Company does not intend, and does not assume any obligationto, update these forward-looking statements. In certain cases, forward-lookingstatements can be identified by the use of words such as "strategy","projects" or "projected", "target", "plans", "expects" or "does not expect","is expected", "budget", "scheduled", "estimates", "intends", "anticipates" or"does not anticipate", "believes", or variations of such words and phrases orstatements that certain actions, events or results "may", "could", "would","might" or "will be taken", "occur" or "be achieved". Examples of forwardlooking statements in this news release include, but are not limited to,statements regarding the Company's expectations as to crude oil production andthe projected exit production rate for 2006, the likelihood of exceeding theCompany's previous production targets, the likelihood of exceeding theCompany's cash flow for the year, and the estimated average price per barrelof crude oil. A number of assumptions were applied in deriving the Company's 2006projected exit production rate, and making the other forward lookingstatements, including that the rate of well takeovers and well recompletionsof the past will continue and success rates will be similar to those ratesexperienced for well recompletions/development during the same period, thatfurther wells taken over and recompleted will produce at rates similar to theaverage rate of production achieved from wells recompleted/redeveloped in thepast, continued availability of the necessary equipment and personnel tosustain the Company's planned work program for the remainder of 2006,continued political and economic stability in Albania; the existence ofreserves as expected; the continued release by Albpetrol of areas and wellspursuant to the Plan of Development; the absence of unplanned disruptions; theability of the Company to bring production to market; and general risksinherent in oil and gas operations. Statements including forward-looking information involve known andunknown risks, uncertainties and other factors which may cause the actualresults of the Company and its operations to be materially different fromestimated costs or results expressed or implied by such forward-lookingstatements. Such factors include, among others, the risk that future wellredevelopment will not have the same success rates or rates of recompletion asthose experienced in the recent months, that Brent oil prices could fall belowUS$55 per barrel, general risks and uncertainties associated with explorationand petroleum operations including delays associated with equipmentprocurement, equipment failure, lack of suitably qualified personnel, theinherent uncertainty in estimation of reserves, exports from Albania beingdisrupted due to unplanned disruptions, changes in the political or economicenvironment, and other factors described under "Risk Factors" in the Company'sAnnual Information Form, NI 51-101F1 and in each of the Company's management'sdiscussion and analysis filed with the Securities Commissions of the provincesof British Columbia, Alberta, and Ontario, which are available on SEDAR atwww.sedar.com. We caution that forward-looking statements involve a number of risks anduncertainties, and there can be no assurance that such statements will proveto be accurate. Although the Company has attempted to take into accountimportant factors that could cause actual costs or results to differmaterially, there may be other factors that cause costs of the Company'sprogram or results not to be as anticipated, estimated or intended. There canbe no assurance that such statements will prove to be accurate as actualresults and future events could differ materially from those anticipated insuch statements. Accordingly, readers should not place undue reliance onforward-looking information. Review by Qualified Person This operations update was reviewed by Richard Wadsworth, President ofBankers Petroleum Ltd., who is a "qualified person" under the rules andpolicies of AIM in his role with the Company and due to his training as aprofessional petroleum engineer with over 14 years experience in domestic andinternational oil and gas operations. For further information: Susan J. Soprovich, VP, Investor Relations andCorporate Governance, (403) 541-5313, Email:investorrelations(at)bankerspetroleum.com; Website: www.bankerspetroleum.com (BNK. BNK.WT.) ENDBANKERS PETROLEUM LIMITED