This company must be the best kept secret...at the end of 1997...according to the Nesbitt book...they were 35% ahead of that... Nesbitt said that they should be trading in the area of $7.00 share...add 35 % onto that and this stock should be above $9.00 right now...This is the news release that came out to-day.
1997 Results Financial and Operational Results
BITECH PETROLEUM CORP ("BPU-T;BHPTF-L")
- 1997 Results Financial and Operational Results
James B. Clubb - Chairman and CEO, Bitech Petroleum Corp. is pleased to announce 1997 Financial and Operational Results. 1997 was a very successful year for Bitech. The key highlights for the year were: - At South Kyrtayel, the well drilling at the end of 1996 was completed,
three new wells were drilled and completed, and a further well was
drilling at year-end. These included the first horizontal wells
drilled in the Komi Republic; - Development of Bitech's second field commenced; - Production rose from 1,400 barrels of oil per day ("bopd") to
approximately 12,000 bopd; - Oil reserves at South Kyrtayel doubled; - Positive income and cash flow generated for the year; - Successful US $ 25 million financing completed; - Retained earnings became positive in 1997. For the years ended 31st December, Bitech recorded:
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Expressed in US Dollars
1997 1996
Total Revenues 19,609,122 2,392,786
Pre-tax Income (Loss) from Operations 1,721,709 (2,658,824)
Net Income (Loss) 1,208,053 (2,708,423)
Cash flow per share 0.15 (0.19)
Income (Loss) per share 0.03 (0.16)
Cash and short term investments
at year end 13,837,967 7,720,686
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The statistics noted above demonstrate the substantial growth which Bitech achieved in 1997. Bitech had a truly successful year in 1997. It was the year in which the Company proved it could operate in Russia and deliver its promises. Production rose steadily during the course of the year as each new well was added. This success was achieved as a result of combining the strengths of the Russian work force with western experience of developing oil fields in similar climatic environments. It was also done within the framework of the Russian economy and not by attempting solely to use western equipment. Key to our success has been the fact that Bitech is a true integration of Russia and the West. The Company's licences are not held through a joint venture but within a 95% subsidiary, Bitech-Silur JSC, with Russian involvement obtained as part of the management team of Bitech. In Russia, Bitech is accepted as a Russian company. At South Kyrtayel, development continued during the course of the year. Three new wells were drilled and completed, including the first two horizontal wells in the Komi Republic. The well drilling at the end of 1996 was completed and brought on stream in late February 1997. At 31st December 1997, a further well was drilling. Additional storage capacity was added at the gathering station. Government approval for the development of the Lekker Field was obtained in August 1997 and actual development commenced with: - site clearance - the stock-piling of equipment - the creation of a tie-in to the Northern Transneft pipeline - the construction of winter roads between Pechora and Lekker
(approximately 100 kilometres) and Lekker and Usinsk (approximately
35 kilometres) First production from the field was achieved in March 1998 through a work-over of an existing well. A second work-over well is near completion and the drilling of the first new development well is expected in mid 1998. The 1997 production was sold on both the export and domestic markets. Due to the high level of production in the fourth quarter, which accounted for approximately 49% of 1997's total sales, and due to the way access to the export points is controlled, exports only averaged 36% of total sales for 1997. To mitigate the increased level of domestic sales in the fourth quarter, a long-term sales agreement was entered into with a significant Moscow-based refiner. The structure of the contract allows both a high price and reduced payment period to be obtained. In the case of Bitech, export sales are of Urals Blend crude. In 1997, Bitech achieved an average sales price of US $11.35 per barrel. The independent engineers reserve report, issued in March, showed proved and probable additional reserves to be significantly higher than those of 1996. Similarly the value attributed to these, at a 10% discount, was some US $86 million higher than the comparable 1996 valuation at US $236.4 million as opposed to US $150.4 million. No separate report is made for the fourth quarter results, which are subsumed in those for the entire year. The absence of this individual report conceals the financial advances that were made late in 1997 together with the implications these may have in 1998. Oil sales in the fourth quarter were US $8,212,231, net income US $1,091,431 and cash flow per share was US $0.14. In 1998, the Company plans to continue the development of the South Kyrtayel Field through the completion of the well that was drilling at year-end and the drilling of two further wells. In the case of Lekker, development will take the form of two work-overs of existing wells, the drilling of up to three new wells and the completion of the necessary infrastructure for full field production. A work-over of an existing well, followed by a long-term production test will take place on the Subor Field. The Company is progressing in the acquisition of new assets and licences in the Timan-Pechora Basin. In the current period of low oil prices, Bitech is less sensitive than most other oil producers to lower prices because of the large portion of production the Company has budgeted to sell into the Russian domestic market, where prices to date have remained relatively stable. Bitech ended 1997 in a strong financial position, with high levels of production, positive cash flow, a healthy cash balance and no debt.
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BITECH PETROLEUM CORPORATION
Consolidated Balance Sheets
As at 31st December
Expressed in US Dollars
1997 1996
ASSETS
Current
Cash and short-term investments 13,837,967 7,720,686
Accounts receivable and other 1,430,690 901,936
Advances to suppliers 319,540 282,898
Crude oil inventory 213,154 967,374
Supplies inventory 3,127,590 1,824,968
Total Current Assets 18,928,941 11,697,862
Oil and gas properties 46,190,356 26,351,656
Mineral properties 1,335,503 1,159,941
Total Assets 66,454,800 39,209,459
LIABILITIES & SHAREHOLDERS'
EQUITY
Current
Accounts payable and accrued
liabilities 3,936,375 3,420,234
Total current liabilities 3,936,375 3,420,234
Deferred income taxes 335,519 -
Minority interest 326,936 225,118
Total liabilities 4,598,830 3,645,352
Shareholders' equity
Capital stock 60,530,706 45,697,700
Contributed surplus 117,211 117,211
Retained earnings 1,208,053 (10,250,804)
Total shareholders' equity 61,855,970 35,564,107
Total liabilities and
shareholders' equity 66,454,800 39,209,459
BITECH PETROLEUM CORPORATION
Consolidated Statements of Operations and Retained Earnings (Deficit)
For the Years Ended 31st December
Expressed in US Dollars
1997 1996
REVENUES
Oil sales 18,749,951 2,102,000
Interest income 594,231 179,958
Other income 264,940 110,828
Total revenues 19,609,122 2,392,786
EXPENSES
Operating expenses 4,311,761 1,098,736
Transportation and other
selling expenses 2,048,312 357,418
General and administrative 3,163,339 1,900,383
Production and other local taxes 4,883,193 885,211
Depreciation, depletion and
amortization 3,480,808 809,862
Total expenses 17,887,413 5,051,610
Income (loss) before income taxes
and minority interest 1,721,709 (2,658,824)
Income taxes 411,838 130,684
Income (loss) before minority
interest 1,309,871 (2,789,508)
Minority interest 101,818 81,085
Net income (loss) for the year 1,208,053 (2,708,423)
Deficit, beginning of year (10,250,804) (7,542,381)
Elimination of the deficit 10,250,804 -
Retained earnings (deficit),
end of year 1,208,053 (10,250,804)
Income (loss) per share - basic 0.03 (0.16)
Income (loss) per share - fully diluted 0.03 (0.16)
Weighted average number of shares
outstanding 36,673,345 16,710,449
BITECH PETROLEUM CORPORATION
Consolidated Statements of Changes in Financial Position
For the Years Ended 31st December
Expressed in US Dollars
1997 1996
OPERATING ACTIVITIES
Net income (loss) for the year 1,208,053 (2,708,423)
Add (deduct) items not involving cash
Depreciation, depletion and
amortization 3,480,808 809,862
Loss on sale of Noveder Inc. shares - 6,472
Deferred income taxes 335,519 -
Minority interest 101,818 (81,085)
Cash flow from operations
before changes in
non-cash working capital 5,126,198 (1,973,174)
Net change in non-cash components of
working capital 322,234 (1,122,217)
Cash provided by (used in) operating
activities 5,448,432 (3,095,391)
INVESTING ACTIVITIES
Acquisition of oil and gas properties (1,024,325) -
Expenditures on oil and gas properties (20,733,389) (10,866,453)
Expenditures on pipeline construction (1,381,685) (7,412,793)
Expenditures on mineral properties (190,646) (520)
Decrease in marketable securities - 635,246
Proceeds on optioning mining rights 15,084 15,071
Net change in non-cash components of
working capital (1,100,000) 1,100,000
Cash used in investing activities (24,414,961) (16,529,449)
FINANCING ACTIVITIES
Common shares issued 24,559,485 24,692,145
Common shares to be issued 524,325 958,265
Minority interest contributions - 220,631
Cash provided by financing activities 25,083,810 25,871,041
Net cash increase during the year 6,117,281 6,246,201
Cash and short-term investments,
beginning of year 7,720,686 1,474,485
Cash and short-term investments,
end of year 13,837,967 7,720,686
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Background Notes
Bitech Petroleum Corporation is a company quoted on The Toronto Stock
Exchange (symbol: "BPU")
and the Frankfurt & Berlin Stock Exchanges. It is
an oil company with ownership of six oil licences in the Komi Republic of
the Russian Federation. The operations are centred on the town of Pechora,
which is approximately 1,500 kilometres to the north east of Moscow and
approximately 50 kilometres to the west of the Ural Mountains. The terrain
around Pechora is similar to that of northern Alberta.
Each licence has a proven oil field. The first of these to be developed
was South Kyrtayel, which commenced production in late 1995. The second
field to be developed is Lekker and the third is Subor. Reserves of each
field at 1st January 1998 were as set out in the table below.
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Proved and
Probable Probable
Proved Additional Additional
Reserves Reserves Reserves
MMstb MMstb MMstb
Commercial Fields
South Kyrtayel 39.8 6.9 46.7
Lekker 14.5 5.2 19.7
Subtotal 54.3 12.1 66.4
Potentially commercial fields
Subor 15.2 15.2
Subtotal 15.2 15.2
Technical Reserves
Pyzchel 53.2 53.2
East Pyzchel 2.9 2.9
Aranetz 1.9 1.9
Subtotal 58.0 58.0
TOTAL RESERVES 54.3 85.3 139.6
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These reserves are as audited by Scientific Software-Intercomp (UK) Limited, a subsidiary of Scientific Software-Intercomp Corporation. Production from South Kyrtayel is by way of its own 28 kilometre pipeline which ties in to the Northern Transneft Pipeline, the main pipeline transmission from this area to Moscow and export from Russia.
TEL: +44 171 766 9600 James B. Clubb - Chairman and CEO FAX: +44 171 766 9660 Nicholas H. Gay - Chief Financial Officer
Raymond A. De Smedt - Vice Chairman E-mail nicholasgay@bitechpetroleum.com
They sure look like a winner to me....Doug
The formating is terribly...sorry...I got it of Canstock |
