15th Dec 2015 12:18
LONDON (Alliance News) - Bankers Petroleum Ltd on Tuesday said its USD65.0 million capital program will be fully supported by funds generated from operations and cash resources.
The budget has been approved by the company's board, and will be submitted to the Albanian authorities for their approval.
The 2016 capital program prioritises the company's strategy to maintain a strong
balance sheet amid a backdrop of low oil prices, the company said, with the aim of maximising activity to fit within cash flow.
"We have put together a strategic and fully funded capital program that leverages our
operational flexibility while prioritising the strength of the company's balance sheet," Chief Executive David French said in a statement.
"This plan will maintain balanced spending throughout the year, utilizing available cash flow to position the company well at the end of 2016 and beyond," French added.
The current 2016 capital budget and work program is based on an average annual Brent oil price assumption of USD46.25 per barrel: USD42.50 per barrel in the first half of the year, with some pricing improvement assumed for the second half average of USD50.00 per barrel.
Brent crude was at USD38.48 on Tuesday at about midday.
The company said it has agreed to receive an average cash realisation equivalent to 74.5% of Dated Brent for the export market (FOB Vlore Port): 73% of Dated Brent in the first quarter during the winter season and 75% of Dated Brent for the remaining three quarters of the year.
In addition, Bankers said it is in talks for domestic crude oil sales contracts for a portion of its volumes and expects to receive equivalent pricing to the export market after reducing transportation and export related fees.
Bankers said it expects 2016 average production levels to decline approximately 15%
during the year.
"This assumes an improved corporate decline rate of approximately 20% as a result of support from the enhanced oil recovery program, which continued at a good pace in the second half of 2015. The production profile will improve towards the end of the year, with added support from the delayed drilling program and EOR conversions in 2016," the company said.
Shares in Bankers were untraded on Tuesday shortly after midday in London. The stock closed at 50.00 pence the previous day.
By Samuel Agini; [email protected]; @samuelagini
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