TIRANA, April 5 – Canada-based Bankers Petroleum delayed drilling activity in the first quarter of this year as international oil prices hit a 12-year low of below $30 a barrel. The country’s largest oil producer, which has recently signed a preliminary deal with China’s Geo-Jade Petroleum Corporation to sell its major Albania assets for a reported C$575 million (€392 mln), reported lower oil production and sales in the year’s first quarter as the company’s average oil price dropped to $21.07 per barrel, representing 62 percent of the Brent oil price of $33.89 per barrel.
Oil sales in the year’s first quarter averaged 17,280 barrels of oil per day (bopd), compared to the fourth quarter sales in 2015 of 18,558 bopd and 20,284 bopd in January-March 2015.
“Due to the low oil price environment, Bankers elected to defer drilling activity at the start of the year in order to protect the strength of the company’s balance sheet. Drilling activity will resume as pricing improves,” the company said in a statement.
In 2015, Bankers drilled a total of 61 horizontal wells, utilizing two drilling rigs. The two drilling rigs that were utilized throughout 2015 have been temporarily suspended as of the end of December. “Drilling activity will resume as pricing improves; the rigs have been racked in country and remain available to resume activity on short notice,” the company has earlier said.
The company says it plans to drill 16 wells in the core area of the Patos-Marinza oilfield in the second half of the year as pricing allows.
The surprise Bankers Petroleum sale deal comes as the country’s biggest oil producer has recently been facing tough times after more than a decade of operations in Albania due to a sharp cut in international oil prices and tax and environmental disputes with the Albanian government.
The announcement of the deal comes soon after Canada-based Bankers Petroleum suffered losses of $3.6 million in 2015 when oil prices almost halved to an average of $52/barrel forcing the country’s largest oil producer to cut production and sales.
The 2015 losses follow record high profits of about $129 million in 2014 when international oil prices embarked on a downward trend that has taken them to a 12-year low. The 2015 financial situation is the worst the company has faced since its early years of operation in the country in 2004-2009.
Since 2004, Bankers operates and has the full rights to develop the Patos-Marinza and Kuà§ova 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 Kuà§ova field has 297 million barrels of original-oil-in-place.
