TSX ticker symbol; BKX
OTCQX ticker symbol; BNKPF
NEWBURY PARK, Calif.,
Aug. 11, 2020 /PRNewswire/ -
All amounts are in U.S. Dollars unless otherwise indicated:
SECOND QUARTER HIGHLIGHTS
- Average production for the second quarter of 2020 was 1,163
BOEPD, a decrease of 15% compared to the second quarter of 2019
average production of 1,368 BOEPD due to the normal production
decline of existing wells
- The Company has commodity contracts in place for almost 80% of
its existing 2020 oil production at an average price of
$58.31/barrel
- General & administrative ("G&A") expense decreased by
23% in the second quarter of 2020 compared to the prior year
quarter due to lower payroll and related costs due to management's
continued efforts to reduce G&A costs throughout the Company
including employee terminations at the end of 2019
- Operating expense per barrel averaged $6.07 per BOE for the second quarter of 2020
compared to $7.59 per BOE for the
same period in 2019, a decrease of 20%. The decrease was due to
cost cutting measures taken in the field during the current
year
- Interest expense decreased by 39% in the second quarter of 2020
compared to the same period in the prior year due to principal
payments on the credit facility during 2019 and 2020 which reduced
the outstanding loan balance
- Average netback including commodity contracts for the second
quarter of 2020 was $21.15 per
barrel, a decrease of 21% from the prior year second quarter due to
lower prices in 2020
- Adjusted funds flow was $1.6
million in the second quarter 2020 compared to $2.5 million in the second quarter of 2019. The
decrease was mainly due to a 60% decrease in average oil prices and
a decrease of 15% in production partially offset by realized gains
from commodity contracts of $1.3
million
- Net loss for the second quarter of 2020 was $2.2 million compared to net income of
$1.5 million for the second quarter
of 2019 due to unrealized losses of $2.3
million from hedged commodity contracts in the second
quarter of 2020 compared to an unrealized gain of $1.1 million in second quarter 2019.
Without the unrealized hedging losses for the second quarter of
2020, the Company would have recognized positive net income
- Revenue, net of royalties was $1.5
million in the second quarter of 2020 compared to
$4.6 million for second quarter of
2019, a decrease of 66%, as prices decreased by 60% and production
decreased by 15%
- The Company has an outstanding balance of $23.0 million on its credit facility at
June 30, 2020 after paying down
$4.5 million during the first six
months of 2020
- At June 30, 2020, cash totaled
$1.4 million
BNK's President and Chief Executive Officer, Wolf Regener commented:
"We are pleased that the Company was able to generate positive
adjusted funds flow of $1.6 million
during the second quarter of 2020 due to the Company's strong hedge
position. For the second half of 2020, the Company has
commodity contracts in place for almost 80% of its existing oil
production at an average price of $58.31/barrel. The Company also
has almost 40% of its 2021 existing oil production hedged at
$52.66/barrel. We are also
experiencing low decline rates in our field, with a year over year
decline rate on existing wells of only 15%. Going forward,
the Company expects its hedges and low decline rates to allow the
Company to continue to generate positive cash flow from its
operations. Without the unrealized loss from commodity hedges
in the second quarter of 2020, the Company would have recognized
positive net income.
The Company has continued to focus on cost reductions during
2020. Our G&A expense for the second quarter of 2020
decreased by 23% from the prior year quarter due to continued cost
cutting including employee terminations. We also
significantly reduced field operating costs which lowered our
operating expense per barrel for the second quarter of 2020 to
$6.07/barrel which was a 20% decrease
from the prior year quarter. The Company has also made
$4.5 million of principal debt
repayments during 2020, which has lowered our interest expense by
39% in the second quarter of 2020 compared to the second quarter of
2019.
The Company's adjusted funds flow was $1.6 million for the second quarter of 2020
compared to $2.5 million in the
second quarter of 2019. The decrease was mainly due to lower
average prices and lower production partially offset by realized
gains from commodity contracts.
Average production for the second quarter of 2020 was 1,163
BOEPD, a decrease of 15% compared to the second quarter of 2019
average production of 1,368 BOEPD. Average production for the
six months ended June 30, 2020 was
1,194 BOEPD, a decrease of 17% from the average production of 1,440
BOEPD in the same period of 2019. The decrease was due
to the normal production decline of the Company's existing
wells.
Net revenue decreased by 66% in the second quarter of 2020 as
average prices decreased by 60% and production decreased by 15% and
compared to the prior year quarter.
Average netback including commodity contracts for the second
quarter of 2020 was $21.15 per
barrel, a decrease of 21% from the prior year second quarter, even
though prices decreased by more than 60%, with the oil price
averaging $23.35/barrel, in the
second quarter. The Company's commodity contracts contributed
an additional $12.75 per barrel to
the second quarter 2020 netback including commodity contracts
amount.
The Company incurred a net loss for the second quarter of 2020
of $2.2 million compared to net
income of $1.5 million for the second
quarter of 2019. This was due to unrealized losses of
$2.3 million from hedged commodity
contracts in the second quarter of 2020 compared to an unrealized
gain of $1.1 million in second
quarter 2019.
|
Second
Quarter
|
|
First Six
Months
|
|
|
2019
|
2018
|
%
|
2019
|
2018
|
%
|
|
|
|
|
|
|
|
Net Income
(Loss):
|
|
|
|
|
|
|
$
Thousands
|
$(2,224)
|
$1,531
|
-
|
$
(68,716)
|
$
54
|
-
|
$ per common
share
|
$(0.01)
|
$0.01
|
-
|
$(0.30)
|
$0.00
|
-
|
assuming
dilution
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Expenditures
(adjustments)
|
$(110)
|
$363
|
-
|
$(111)
|
$1,115
|
-
|
|
|
|
|
|
|
|
Average Production
(Boepd)
|
1,163
|
1,368
|
(15%)
|
1,194
|
1,440
|
(17%)
|
Average Price per
Barrel
|
$18.72
|
$47.19
|
(60%)
|
$27.15
|
$44.88
|
(40%)
|
Average Netback from
operations per Barrel
|
$8.41
|
$29.38
|
(71%)
|
$14.75
|
$28.03
|
(47%)
|
Average Netback
including commodity contracts per Barrel
|
$21.15
|
$26.93
|
(21%)
|
$22.67
|
$26.20
|
(13%)
|
|
|
|
|
|
|
|
|
June 2020
|
|
March 2020
|
|
December
2019
|
|
|
|
|
|
|
|
|
Cash and Cash
Equivalents
|
$
1,388
|
|
$ 3,745
|
|
$
3,089
|
|
Working
Capital
|
$ (1,790)
|
|
$(1,572)
|
|
$
(2,482)
|
|
Second Quarter 2020 versus Second Quarter 2019
Oil and gas gross revenues totaled $1,981,000 in the quarter versus $5,875,000 in the second quarter of 2019.
Oil revenues decreased $3,658,000 or
68% as oil production decreased by 21% to 804 boepd and average oil
prices decreased by $34.70 per barrel
or 60% to $23.35 per barrel.
Natural gas revenues decreased $97,000 or 39% to $153,000 as natural gas production decreased 2%
to 1,033 mcfpd and average natural gas prices decreased by
$0.98/mcf or 38% to $1.63/mcf. Natural gas liquids (NGLs)
revenues decreased $139,000 or 54% as
average NGL prices decreased 56% to $7.00 which was partially offset by an NGL
production increase of 6% to 187 boepd.
Average production for the second quarter of 2020 was 1,163
boepd, a decrease of 15% compared to the second quarter of 2019
average production of 1,368 boepd. The decrease was due to
the normal production decline of the Company's existing wells.
Production and operating expenses decreased to $642,000 due to lower production and cost
cutting. Production and operating expense per barrel averaged
$6.07 per BOE for the second quarter
of 2020 compared to $7.59 per BOE for
the same period in 2019, a decrease of 20%. The
decrease was due to cost cutting measures taken in the field during
the current year.
Depletion and depreciation expense decreased $383,000 or 25% due to a decrease in production
in the second quarter of 2020 and a lower PP&E balance due to
the impairment.
General and administrative expenses decreased $194,000 or 23% due to lower payroll and related
costs due to employee terminations at the end of 2019 and
management's continued efforts to reduce G&A costs throughout
the Company.
Finance income increased $0.2
million in the second quarter of 2020 compared to the prior
year quarter due to unrealized gains on commodity contracts in the
second quarter of 2020.
Finance expense increased $1.8
million in the second quarter of 2020 compared to the prior
year quarter primarily due to an unrealized loss on commodity
contracts of $2.3 million in the
second quarter of 2020.
Capital expenditures adjustments reduced PP&E by
$110,000 in the second quarter of
2020 relating to cost revisions on a non-operated well.
FIRST SIX MONTHS 2020 HIGHLIGHTS
- Average production for the first six months of 2020 was 1,194
BOEPD, a decrease of 17% compared to the first six months of 2019
average production of 1,440 BOEPD due to the normal production
decline of existing wells
- The Company has commodity contracts in place for almost 80% of
its existing 2020 oil production at an average price of
$58.31/barrel
- G&A expense decreased by 20% in the first six months of
2020 compared to the prior year due to lower payroll and related
costs due to employee terminations at the end of 2019 and
management's continued efforts to reduce G&A costs throughout
the Company
- Operating expense per barrel averaged $6.44 per BOE for the first six months of 2020
compared to $7.19 per BOE for the
same period in 2019, a decrease of 10%. The decrease was due to
cost cutting measures taken in the field during the current
year
- Interest expense decreased by 27% in the first six months of
2020 compared to the same period in the prior year due to principal
payments on the credit facility during 2019 and 2020 which reduced
the outstanding loan balance
- Average netback including commodity contracts for the first six
months of 2020 was $22.67 per barrel,
a decrease of 13% from the prior year period due to lower prices in
2020
- Adjusted funds flow was $3.6
million in the first six months of 2020 compared to
$5.1 million in the first six months
of 2019. The decrease was mainly due to a 40% decrease in average
oil prices and a decrease of 17% in production partially offset by
realized gains from commodity contracts of $1.7 million
- Due to the significant decline in commodity prices and the
global impact on demand from the COVID-19 pandemic, the Company
performed a PP&E impairment test in the first quarter of 2020.
The impairment test resulted in an impairment of PP&E which
totaled $71.9 million. In accordance
with IFRS, an impairment loss can generally be reversed in future
periods if there is an indication that a previously recognized
impairment loss has reversed because of a change in the estimates
used to determine the impairment loss and the recoverable amount of
the impaired asset subsequently increases
- Net loss for the first six months of 2020 was $68.7 million compared to net income of
$54 thousand for the first six months
of 2019 due to the PP&E impairment
- Revenue, net of royalties was $4.6
million in the first six months of 2020 compared to
$9.2 million for first six months of
2019, a decrease of 50%, as prices decreased by 40% and production
decreased by 17%
First Six Months of 2020 versus First Six Months of 2019
Gross oil and gas revenues totaled $5,899,000 in the first six months of 2020 versus
$11,698,000 in the first six months
of 2019. Oil revenues were $5,150,000 in the first six months versus
$10,637,000 in the same period of
2019, a decrease of 52% as average oil prices decreased 38% or
$20.84 a barrel coupled by a decrease
in oil production of 23%. Natural gas revenues decreased
$213,000 or 38%, due to an average
natural gas price decrease of 39% in the first six months of 2020
compared to the prior year period. NGL revenue decreased
$99,000, or 20%, due to an average
NGL price decrease of 18% and an NGL production decrease of 3% in
the first six months of 2020.
Average production for the first six months of 2020 was 1,194
boepd, a decrease of 17% from the average production of 1,440 boepd
in the same period of 2019. The decrease was due to the
normal production decline of the Company's existing wells.
Production and operating expenses decreased to $1,400,000 due to lower production and cost
cutting. Production and operating expense per barrel averaged
$6.44 per BOE for the first six
months of 2020 compared to $7.19 per
BOE for the same period in 2019, a decrease of 10%. The
decrease was due to cost cutting measures taken in the field during
the current year.
Depletion and depreciation expense decreased $692,000 or 22% due to a decrease in production
in the first six months of 2020 and a lower PP&E balance due to
the impairment.
General and administrative expenses decreased $364,000 or 21% due to lower payroll and related
costs due to employee terminations at the end of 2019 and
management's continued efforts to reduce G&A costs throughout
the Company.
Due to industry and market conditions, especially the
significant decline in commodity prices and the global impact on
demand from the COVID-19 pandemic, the Company performed a PP&E
impairment test at March 31,
2020. The impairment test resulted in an impairment of
PP&E which totaled $71.9 million
for the first six months of 2020. In accordance with IFRS, an
impairment loss can generally be reversed in future periods if
there is an indication that a previously recognized impairment loss
has reversed because of a change in the estimates used to determine
the impairment loss and the recoverable amount of the impaired
asset subsequently increases.
Finance income increased $4.6
million in the first six months of 2020 compared to the
prior year period due to $2.9 million
of unrealized gains on commodity contracts and $1.7 million of realized gains in the first six
months of 2020.
Finance expense decreased $1.4
million in the first six months of 2020 compared to the
prior year period due to an unrealized and realized losses on
commodity contracts in the first six months of 2019 as well as
lower interest expense in the first six months of 2020 compared to
the prior year period.
Capital expenditures adjustments reduced PP&E by
$111,000 in the first six months of
2020 relating to cost revisions on a non-operated well.
BNK PETROLEUM
INC.
CONDENSED
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Unaudited,
Expressed in Thousands of United States Dollars)
|
($000 except as
noted)
|
|
June
30
|
|
December
31
|
|
2020
|
|
2019
|
|
|
|
|
Current
Assets
|
|
|
|
Cash
|
$1,388
|
|
$ 3,089
|
Trade and other
receivables
|
1,357
|
|
2,198
|
Other current
assets
|
330
|
|
513
|
Fair value of
commodity contracts
|
2,184
|
|
-
|
|
5,259
|
|
5,800
|
|
|
|
|
Non-current
assets
|
|
|
|
Property, plant and
equipment
|
80,868
|
|
155,408
|
Fair value of
commodity contracts
|
429
|
|
-
|
|
81,297
|
|
155,408
|
|
|
|
|
Total
Assets
|
$86,556
|
|
$161,208
|
|
|
|
|
Current
Liabilities
|
|
|
|
Trade and other
payables
|
$5,022
|
|
$6,424
|
Current portion of
loans and borrowings
|
2,000
|
|
1,500
|
Fair value of
commodity contracts
|
-
|
|
253
|
Lease
payable
|
27
|
|
105
|
|
7,049
|
|
8,282
|
|
|
|
|
Non-current
liabilities
|
|
|
|
Loans and
borrowings
|
21,022
|
|
25,664
|
Asset retirement
obligations
|
1,143
|
|
1,127
|
Fair value of
commodity contracts
|
-
|
|
97
|
|
22,165
|
|
26,888
|
|
|
|
|
Equity
|
|
|
|
Share
capital
|
289,622
|
|
289,622
|
Contributed
surplus
|
22,948
|
|
22,925
|
Deficit
|
(255,228)
|
|
(186,512)
|
Total
Equity
|
57,342
|
|
126,035
|
|
|
|
|
Total Equity and
Liabilities
|
$86,556
|
|
$161,208
|
BNK PETROLEUM
INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS
|
(Unaudited,
expressed in Thousands of United States dollars, except per
share amounts)
|
($000 except as
noted)
|
|
|
Second
Quarter
|
|
First Six
Months
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
Oil and natural gas
revenue, net
|
$
|
1,532
|
|
4,601
|
|
4,603
|
|
9,178
|
Other
income
|
|
-
|
|
1
|
|
1
|
|
2
|
|
|
1,532
|
|
4,602
|
|
4,604
|
|
9,180
|
|
|
|
|
|
|
|
|
|
Production and
operating expenses
|
|
642
|
|
945
|
|
1,400
|
|
1,874
|
Depletion and
depreciation expense
|
|
1,148
|
|
1,531
|
|
2,508
|
|
3,200
|
General and
administrative expenses
|
|
636
|
|
830
|
|
1,373
|
|
1,737
|
Stock based
compensation
|
|
5
|
|
28
|
|
21
|
|
94
|
Impairment of
PP&E
|
|
-
|
|
-
|
|
71,923
|
|
-
|
|
|
2,431
|
|
3,334
|
|
77,225
|
|
6,905
|
|
|
|
|
|
|
|
|
|
Finance
income
|
|
1,349
|
|
1,109
|
|
4,686
|
|
8
|
Finance
expense
|
|
(2,674)
|
|
(846)
|
|
(781)
|
|
(2,229)
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
(2,224)
|
|
1,531
|
|
(68,716)
|
|
54
|
Net income (loss) per
share
|
$
|
(0.01)
|
|
0.01
|
|
(0.30)
|
|
0.00
|
BNK PETROLEUM
INC.
|
SECOND QUARTER
2020
|
(Unaudited,
expressed in Thousands of United States dollars, except as
noted)
|
|
|
|
|
|
Second
Quarter
|
|
First Six
Months
|
|
|
2020
|
2019
|
|
2020
|
2019
|
Oil revenue before
royalties
|
$
|
1,709
|
5,367
|
|
5,150
|
10,637
|
Gas revenue before
royalties
|
|
153
|
250
|
|
342
|
555
|
NGL revenue before
royalties
|
|
119
|
258
|
|
407
|
506
|
Oil and Gas
revenue
|
|
1,981
|
5,875
|
|
5,899
|
11,698
|
|
|
|
Adjusted funds
flow
|
|
1,601
|
2,525
|
|
3,553
|
5,099
|
Additions to
property, plant & equipment
|
|
(110)
|
363
|
|
(111)
|
1,115
|
|
|
|
|
|
|
Statistics:
|
|
|
|
|
|
2nd
Quarter
|
|
First Six
Months
|
|
|
2020
|
2019
|
|
2020
|
2019
|
Average oil
production (Bopd)
|
|
804
|
1,016
|
|
823
|
1,064
|
Average natural gas
production (mcf/d)
|
|
1,033
|
1,052
|
|
1,050
|
1,046
|
Average NGL
production (Boepd)
|
|
187
|
177
|
|
196
|
202
|
Average production
(Boepd)
|
|
1,163
|
1,368
|
|
1,194
|
1,440
|
Average oil price
($/bbl)
|
|
$23.35
|
$58.05
|
|
$34.37
|
$55.21
|
Average natural gas
price ($/mcf)
|
|
$1.63
|
$2.61
|
|
$1.79
|
$2.93
|
Average NGL price
($/bbl)
|
|
$7.00
|
$16.04
|
|
$11.41
|
$13.87
|
|
|
|
Average price
(Boe)
|
|
$18.72
|
$47.19
|
|
$27.15
|
$44.88
|
Royalties
(Boe)
|
|
4.24
|
10.22
|
|
5.96
|
9.66
|
Operating expenses
(Boe)
|
|
6.07
|
7.59
|
|
6.44
|
7.19
|
Netback from
operations (Boe)
|
|
$8.41
|
$29.38
|
|
$14.75
|
$28.03
|
Price adjustment from
commodity contracts (Boe)
|
|
12.74
|
(2.45)
|
|
7.92
|
(1.83)
|
Netback including
commodity contracts (Boe)
|
|
$21.15
|
$26.93
|
|
$22.67
|
$26.20
|
The information outlined above is extracted from and should be
read in conjunction with the Company's unaudited financial
statements for the three and six months ended June 30, 2020 and the related management's
discussion and analysis thereof, copies of which are available
under the Company's profile at www.sedar.com.
NON-GAAP MEASURES
Netback from operations, netback including commodity contracts,
net operating income and adjusted fund flow (collectively, the
"Company's Non-GAAP Measures") are not measures recognized under
Canadian generally accepted accounting principles ("GAAP") and do
not have any standardized meanings prescribed by GAAP.
The Company's Non-GAAP Measures are described and reconciled to
the GAAP measures in the management's discussion and analysis which
are available under the Company's profile at www.sedar.com.
CAUTIONARY STATEMENTS
In this news release and the Company's other public
disclosure:
(a)
|
The Company's natural
gas production is reported in thousands of cubic feet
("Mcfs"). The Company also uses references to barrels
("Bbls") and barrels of oil equivalent ("Boes") to
reflect natural gas liquids and oil production and sales. Boes may
be misleading, particularly if used in isolation. A Boe conversion
ratio of 6 Mcf:1 Bbl is based on an energy equivalency conversion
method primarily applicable at the burner tip and does not
represent a value equivalency at the wellhead. Given that the value
ratio based on the current price of crude oil as compared to
natural gas is significantly different from the energy equivalency
of 6:1, utilizing a conversion on a 6:1 basis may be misleading as
an indication of value.
|
|
|
(b)
|
Discounted and
undiscounted net present value of future net revenues attributable
to reserves do not represent fair market value.
|
|
|
(c)
|
Possible reserves are
those additional reserves that are less certain to be recovered
than probable reserves. There is a 10% probability that the
quantities actually recovered will equal or exceed the sum of
proved plus probable plus possible reserves.
|
|
|
(d)
|
The Company discloses
peak and 30-day initial production rates and other short-term
production rates. Readers are cautioned that such production
rates are preliminary in nature and are not necessarily indicative
of long-term performance or of ultimate recovery.
|
Caution Regarding Forward-Looking Information
This release contains forward-looking information including
information regarding the proposed timing and expected results of
exploratory and development work including production from the
Company's Tishomingo field,
Oklahoma acreage, availability of
funds from the Company's reserves based loan facility, expected
hedging levels and the Company's strategy and objectives. The use
of any of the words "target", "plans", "anticipate", "continue",
"estimate", "expect", "may", "will", "project", "should", "believe"
and similar expressions are intended to identify forward-looking
statements.
Such forward-looking information is based on management's
expectations and assumptions, including that the Company's geologic
and reservoir models and analysis will be validated, that
indications of early results are reasonably accurate predictors of
the prospectiveness of the shale intervals, that previous
exploration results are indicative of future results and success,
that expected production from future wells can be achieved as
modeled, declines will match the modeling, future well production
rates will be improved over existing wells, that rates of return as
modeled can be achieved, that recoveries are consistent with
management's expectations, that additional wells are actually
drilled and completed, that design and performance improvements
will reduce development time and expense and improve productivity,
that discoveries will prove to be economic, that anticipated
results and estimated costs will be consistent with managements'
expectations, that all required permits and approvals and the
necessary labor and equipment will be obtained, provided or
available, as applicable, on terms that are acceptable to the
Company, when required, that no unforeseen delays, unexpected
geological or other effects, equipment failures, permitting delays
or labor or contract disputes are encountered, that the development
plans of the Company and its co-venturers will not change, that the
demand for oil and gas will be sustained, that the Company will
continue to be able to access sufficient capital through
financings, credit facilities, farm-ins or other participation
arrangements to maintain its projects, that the Company will
continue in compliance with the covenants under its reserves-based
loan facility and that the borrowing base will not be reduced, that
funds will be available from the Company's reserves based loan
facility when required to fund planned operations, that the Company
will not be adversely affected by changing government policies and
regulations, social instability or other political, economic or
diplomatic developments in the countries in which it operates and
that global economic conditions will not deteriorate in a manner
that has an adverse impact on the Company's business and its
ability to advance its business strategy.
Forward looking information involves significant known and
unknown risks and uncertainties, which could cause actual results
to differ materially from those anticipated. These risks include,
but are not limited to: any of the assumptions on which such
forward looking information is based vary or prove to be invalid,
including that the Company's geologic and reservoir models or
analysis are not validated, anticipated results and estimated costs
will not be consistent with managements' expectations, the risks
associated with the oil and gas industry (e.g. operational risks in
development, exploration and production; delays or changes in plans
with respect to exploration and development projects or capital
expenditures; the uncertainty of reserve and resource estimates and
projections relating to production, costs and expenses, and health,
safety and environmental risks including flooding and extended
interruptions due to inclement or hazardous weather), the risk of
commodity price and foreign exchange rate fluctuations, risks and
uncertainties associated with securing the necessary regulatory
approvals and financing to proceed with continued development of
the Tishomingo Field, the Company or its subsidiaries is not able
for any reason to obtain and provide the information necessary to
secure required approvals or that required regulatory approvals are
otherwise not available when required, that unexpected geological
results are encountered, that completion techniques require further
optimization, that production rates do not match the Company's
assumptions, that very low or no production rates are achieved,
that the Company will cease to be in compliance with the covenants
under its reserves-based loan facility and be required to repay
outstanding amounts or that the borrowing base will be reduced
pursuant to a borrowing base re-determination and the Company will
be required to repay the resulting shortfall, that the Company is
unable to access required capital, that funding is not available
from the Company's reserves based loan facility at the times or in
the amounts required for planned operations, that occurrences such
as those that are assumed will not occur, do in fact occur, and
those conditions that are assumed will continue or improve, do not
continue or improve and the other risks identified in the Company's
most recent Annual Information Form under the "Risk Factors"
section, the Company's most recent management's discussion and
analysis and the Company's other public disclosure, available under
the Company's profile on SEDAR at www.sedar.com.
With respect to estimated reserves, the evaluation of the
Company's reserves is based on a limited number of wells with
limited production history and includes a number of assumptions
relating to factors such as availability of capital to fund
required infrastructure, commodity prices, production performance
of the wells drilled, successful drilling of infill wells, the
assumed effects of regulation by government agencies and future
capital and operating costs. All of these estimates will vary from
actual results. Estimates of the recoverable oil and natural gas
reserves attributable to any particular group of properties,
classifications of such reserves based on risk of recovery and
estimates of future net revenues expected therefrom, may vary. The
Company's actual production, revenues, taxes, development and
operating expenditures with respect to its reserves will vary from
such estimates, and such variances could be material. In
addition to the foregoing, other significant factors or
uncertainties that may affect either the Company's reserves or the
future net revenue associated with such reserves
include material changes to existing taxation or royalty rates
and/or regulations, and changes to environmental laws and
regulations.
Although the Company has attempted to take into account
important factors that could cause actual costs or results to
differ materially, there may be other factors that cause actual
results not to be as anticipated, estimated or intended. There can
be no assurance that such statements will prove to be accurate as
actual results and future events could differ materially from those
anticipated in such statements. The forward-looking information
included in this release is expressly qualified in its entirety by
this cautionary statement. Accordingly, readers should not place
undue reliance on forward-looking information. The Company
undertakes no obligation to update these forward-looking
statements, other than as required by applicable law.
About BNK Petroleum Inc.
BNK Petroleum Inc.
is an international oil and gas exploration and production company
focused on finding and exploiting large, predominately
unconventional oil and gas resource plays. Through various
affiliates and subsidiaries, the Company owns and operates shale
gas properties and concessions in the
United States. Additionally the Company is utilizing its
technical and operational expertise to identify and acquire
additional unconventional projects. The Company's shares are traded
on the Toronto Stock Exchange under the stock symbol BKX and on the
OTCQX under the stock symbol BNKPF.
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SOURCE BNK Petroleum Inc.