TIRANA, Feb. 23 – Canada-based Bankers Petroleum, which operates the Patos-Marinza heavy oilfield in south-western Albania and is the country’s largest foreign investor, has agreed to pay US$ 16.5 million to U.K giant BP over the unilateral cancellation of a long-term oil supply contract.
In a statement issued on Monday, Bankers Petroleum said it has reached an out-of-court deal with BP Oil International Limited, the BP’s financial services subsidiary, over a September 2012 lawsuit initiated at the high Court of Justice in London.
“The settlement is for a payment of US$16.5 million inclusive of all costs and interest,” said Bankers.
BP had filed a lawsuit against Bankers Petroleum in November 2012 and initially sought damages of up to US$54.2 million for, among other things, the alleged wrongful termination of such agreement. The claim had recently been revalued at US$37.4 million to reflect movements in oil price since September 2013.
“As part of the settlement, neither party admitted to wrongful or illegal conduct, and both parties’ claims and counterclaims will be dismissed,” said Bankers Petroleum.
Citing a sharp drop in international oil prices, Bankers Petroleum, which is the country’s biggest foreign investor and exporter, said it had reduced its 2015 capital program to US$ 153 million, down from a previously announced capital program of $218 million in early December 2014.
“These adjustments have been made to ensure 2015 spending fits within funds generated from operations and cash resources in the latest oil price environment,” said the company in a statement.
The revised 2015 capital program utilizes a $50 per barrel average annual Brent oil price forecast in comparison to the budget announced on December 12, 2014, which was predicated on an annual Brent oil price forecast of $70 per barrel.
Bankers Petroleum, which has recently made it to the top 100 SEE biggest companies, reported net income of $77.8 million in the first three quarters of 2014, up 67 percent compared to the same period the previous year.
Canadian-based Bankers Petroleum posted record profits of around 62 million dollars in 2013, almost double compared to the previous two years on higher production and oil prices, the company said in its 2013 financial results.
Since 2004, Bankers operates and has the full rights to develop the Patos-Marinza and Kuçova heavy oilfields under a 25-year concession contract with the Albanian government. The Patos-Marinza oilfield is the largest onshore oilfield in continental Europe, holding approximately 5.4 billion barrels of original oil in place. The Kuçova field has 297 million barrels of original-oil-in-place.
