7th Jan 2016 17:16
LONDON (Alliance News) - Bankers Petroleum Ltd Thursday said production fell in 2015 due to significant rainfall in the fourth quarter of the year, but said this is expected to increase in 2016 as it begins to benefit from its flood programme.
However, the company has also deferred drilling activity due to the uncertainty of the oil price, and said it will not re-initiate further drilling until prices improve.
The company said production averaged 18,137 barrels of oil per day in the fourth quarter of 2015, with around 1,000 barrels a day being lost over a two week period due to the large amounts of rainfall in Albania. Sales fell quarter-on-quarter to an average of 18,561 barrels a day from 19,730 barrels.
The average sale price n the last quarter of the year was USD33.62 per barrel compared to the average Brent price of USD43.69, which was also down from the third quarter when Bankers achieved a sale price averaging USD39.50 compared to an average Brent price of USD50.26 a barrel.
"Sales to the export market during the fourth quarter 2015 represented 91% of total sales, at an average export price of 77% of the Brent oil price. The majority of the volumes were sold to the export market in the fourth quarter to capture higher realized prices and consistent off-take during the winter months," said Bankers.
Average daily production over the whole of 2015 came in at 19,384 barrels, which was down from 20,690 barrels a day back in 2014. Sales followed, averaging 19,546 barrels a day in 2015 compared to 20,678 barrels a day a year earlier.
"Following up the performance of the polymer flood program, a large number of injector conversions to expand the polymer flood project were completed in the fourth quarter bringing some production off-line temporarily until response is seen in the offset producers over the coming months in 2016," said Bankers.
Via its flood programme, Bankers expects to to convert 16 of its wells into producing ones throughout 2016, which should benefit production during the year.
"As previously announced, Albania experienced significant rainfall and flash flooding early in the fourth quarter which impacted production," it added.
Bankers hedged a total of 6,000 barrels per day in 2015 and has 4,000 barrels a day hedged for 2016 at an average price of USD54 a barrel, which is favourable compared to Brent, which was trading a smidgen below USD34 a barrel on Thursday.
Bankers drilled 61 wells in 2015 using two rigs, but has halted drilling moving forward.
"Due to continued uncertainty of oil prices headed into 2016, Bankers has elected to defer drilling activity until pricing improves in order to protect the strength of the company's balance sheet," it said.
Bankers shares closed up 4% to 52.0 pence on Thursday.
By Joshua Warner; [email protected]; @JoshAlliance
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