BPC focused on drilling initial exploration well in year and a half
The Bahamas Petroleum Company (BPC) will, over the next year and a half, focus its efforts on fulfilling the obligations tied to the extension of its exploration license and drill an exploration well, BPC Chief Executive Officer (CEO) Simon Potter said in the company’s 2018 annual report. He added that the company’s path to oil exploration has never been more clearly laid and defined.
BPC has had to contend with changes in the government of The Bahamas and the arduous task of securing a farm-in partner to conduct the drilling or secure the financing needed to carry out drilling.
“Everyone at the group remains entirely focused on the singular task of seeing an initial exploration well completed,” Potter said.
“The group’s current obligation – to safely implement an environmentally responsible well prior to the end of 2020 – has been clearly laid out by the government in our recent license extension.
“The group has not had the ability to demonstrate this level of certainty of tenure for a considerable period of time. Along with this, we have secured the working capital we need, the government is supportive, the legislative regime is clear and enacted and we have an adviser in place.”
The government extended BPC’s exploration licenses to the end of 2020.
Apart from the company having most of what it needs to move forward with its first well, Potter said the oil market is favorable for a company to discover a new source of fossil fuel.
“The surrounding industry circumstances are favorable, with sustained recovery in the global oil price and renewed industry interest in frontier exploration,” he said.
“In 2019 and 2020, we thus look forward to delivering, securing the investment needed to drill an initial exploration well and thereby move this exciting project forward.”
Potter thanked investors and staff for “their continued support and perseverance and looks forward to reporting on further developments to you over the course of the coming year”.
Despite ensuring that the company has adequate cash flow to sustain its operations, the company has not made a profit and continues to rely on the issuance of shares and “farm-outs of its licenses” to raise capital.
“The group has incurred losses since its inception and it is therefore not possible to evaluate its prospects based on past performance,” the annual report states.
“Since the group intends to continue investing in the exploration licenses it currently holds an interest in, the directors anticipate making further losses. There can be no certainty that the group will achieve or sustain profitability, or achieve or sustain positive cash flows from its activities.
“The group’s financial liabilities are comprised entirely of its trade and other payables which all fall due within one year. The group’s payment policy is to settle amounts in accordance with agreed terms which is typically 30 days.”
The report also explains that BPC’s “ability to meet its obligations beyond the next 12 months” will depend on its ability to find a drilling partner and move forward with its exploration.
Education: Florida International University, BS in Journalism