Bankers Petroleum interested in buying Albpetrol

TIRANA, August 17 – Canadian-based oil and gas exploration company Bankers Petroleum has announced it is interested in buying Albania’s state-owned firm Albpetrol which has been put on the privatization list.
In a statement issued on the company’s second quarter financial results and operational updates, Bankers said it had expressed its interest to participate in the tender process expected to begin in December 2010.
In a conference discussing results with analysts, Bankers’ president and chief executive Abby Badwi said last weekend Bankers’ bought-deal equity offering that raised $100 million in July was made in part to be able to bid for Albpetrol’s assets.
“We wanted to be able to be proactive when the privatization happened, be able to go and put an offer knowing that we had the funds for it,” said Badwi as quoted by Calgary Herald.
“So, no, we will not be looking for additional financing. Between our cash balances and debt that is available to us of $110 million, we should be in a good position to make a stronger bid for any of these assets. And the numbers are not big. We’re talking about anywhere between 1,000 and 3,000 barrels per day total for Albpetrol, so our bids might be focused only in areas we operate in.”
Badwi said the details of the privatization, to take place in 2011, are not finalized, but he believes Albpetrol’s assets will be sold in pieces.
Oil products produced by state owned company Albpetrol will be sold based on stock market prices, according to a recent government decision .
The changes to the law allow Albpetrol to sell its crude oil products to domestic or foreign markets based on stock prices.
The state-owned oil production company posted a 2 million dollar profit in the first four months of this year, the Economy and Energy Ministry has said.
The good financial performance allowed Albpetrol to pay off 8.1 million dollars it owed to state institutions in taxes and bills.
Albpetrol produced 50,328 tons of oil in the January-April period, nearly 5,000 tons more than it had planned. Albpetrol sells its product to the Albanian Oil Refiner ARMO, but also has full legal rights to export it.
The Economy and Energy Ministry has recently selected Patton Boggs Llp, a US based company as the international consultant for the sale of state-owned oil company Albpetrol.
The US company which also served as consultant for the privatization of oil refinery ARMO, has been given a deadline of six months to assess the company and decide on the method of privatization.
IMF on Albpetrol
In its latest report on Albania, the International Monetary Fund warned increasing payment arrears from the privatized refinery complex (ARMO) threaten the successful privatization of Albpetrolءnd thereby the conclusion of the strategic privatization program. Staff recommended the initiation of legal recovery proceedings against ARMO.