Bankers Pet operational update:Triples Income

By The Canadian Press CALGARY - Bankers Petroleum Ltd. (TSX:BNK.TO - News) earned net income of US$35.9 million in 2011, more than tripling its net income of US$10.5 million in 2010.Oil sales averaged 12,784 barrels of oil per day in 2011, an increase of 33 per cent over 2010 levels, the Calgary-based company focused on heavy oil assets in Albania said Tuesday.Capital expenditures were US$242.8 million, more than double the $119.7 million it spent in 2010.In the fourth quarter of 2011, Bankers Petroleum had net income of US$281,000 versus $4.6 million in the same quarter of 2010.

The company drilled 84 wells in 2011, including 76 horizontal production wells, two vertical delineation wells, two cyclic steam horizontal wells and four water disposal wells. In 2010, a total of 55 wells were drilled.For 2012, the company said it's capital expenditure program will be $215 million, funded from projected cash flow based on an average Brent oil price of US$90 a barrel.Bankers Petroleum said it expects to drill 100 horizontal and vertical wells and complete 60 well reactivations at the Patos-Marinza oilfield.

The company has said its most recent evaluation shows a 43 per cent year-over-year increase in proven reserves.As of Dec. 31, Bankers had 172 million barrels of proven reserves, representing more than 12 times production replacement. Proved plus probable reserves totalled 267 million barrels, a 12 per cent increase from Dec. 31, 2010.

And yet the stock sits at 4.15 because shorts punish great news, go figure.

Bankers Petroleum earns $35.99-million (U.S.) in 2011

Bankers Petroleum earns $35.99-million (U.S.) in 2011

2012-03-20 08:16 ET - News Release

Mr. Robert Cross reports

BANKERS PETROLEUM ANNOUNCES 2011 FINANCIAL RESULTS

Bankers Petroleum Ltd. has provided its 2011 financial results and outlook for 2012. All figures are shown in U.S. dollars, unless otherwise specified.

In 2011, Bankers accomplished several key achievements including record production, reserves, net income and cash flow. The Company also invested $243 million, making it the largest annual capital expenditure in Albania.

PRODUCTION RESULTS
2011 2010

Average production (bopd) 12,784 9,597
Average price ($/barrel) 72.84 48.64
Netback ($/barrel) 36.36 23.15

Highlights of the key achievements in 2011 include:

Oil sales averaged 12,784 barrels of oil per day (bopd), an increase of 33% compared to 2010, as a result of the Company's ongoing horizontal drilling program and continuation of well reactivations.

The original-oil-in-place (OOIP) resource assessment in Albania increased by 3% to 8.0 billion barrels from 7.8 billion barrels. Reserves increased on a proved basis by 43% from 120.2 million barrels in 2010 to 172.4 million barrels in 2011 and by 12% on a proved plus probable basis from 237.6 million barrels in 2010 to 267.1 million barrels in 2011. Additionally, the Company's independent reserves engineers assigned contingent and prospective resource oil estimates of 1.0 billion and 614 million barrels, respectively. The corresponding net present value (NPV) after tax (discounted at 10%) of the proved plus probable reserves remained consistent at $2.0 billion from 2010 to 2011.

Capital expenditures were $242.8 million, a 103% increase from 2010 of $119.7 million. During the year, Bankers contracted a fourth and fifth drilling rig. The Company drilled 84 wells during 2011, including 76 horizontal production wells, two vertical delineation wells, two cyclic steam horizontal wells and four water disposal wells. In 2010, a total of 55 wells were drilled.

New export market agreements for 2012 have been completed representing an overall export average price of 72% of the Dated Brent oil benchmark. ARMO, the Albanian refinery, also agreed to purchase Patos-Marinza crude in 2012 for an average price of 66% of Brent, which approximates the same netback value as the export market due to lower transport costs and having no port fees. The 2012 pricing agreements represent an average 7% increase over the 2011 Patos-Marinza oil price.

Construction of phase one of the crude oil sales pipeline, which connects the Patos-Marinza oilfield to the Fier Hub facility was completed. Operations commenced in the first quarter of 2012. Social and environmental impact assessments for the second phase of the pipeline, from the Fier Hub to the export terminal at Vlore, are underway.

With the ongoing reactivation and recompletion program expanding on the north side of the river, as well as the expected expansion of the drilling towards the north, the Company has constructed and completed a bridge crossing the Seman River to enable more efficient access for drilling and servicing equipment as well as fluid transportation.

The Company has completed expansions of the central treatment facility (CTF) and increased the CTF capacity to 25,000 bopd.

During 2011, Bankers continued with its environmental initiatives and completed the pilot remediation project in Sector 3. The project targeted the clean-up of old infrastructure and removal of legacy oil spills testing mechanical waste separation, thermal desorption, and bio-remediation technologies. Larger scale clean-up processes are scheduled for implementation in 2012.

Block "F" contains several seismically defined structural and stratigraphic amplitude anomalies prospective for oil and natural gas. The first exploration location has been selected and land access is underway along with environmental permitting to commence surface lease construction. The well is expected to be spud in April 2012.

Bankers proceeded with the thermal pilot program during 2011, drilling two horizontal wells and a vertical well, along with installation of the steam generator. Steam injection commenced in December, 2011.

The Company continues to maintain a strong financial position at December 31, 2011 with cash of $54.0 million and working capital of $80.3 million. Cash and working capital for December 31, 2010 was $108.1 million and $130.9 million, respectively.

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