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BNK Petroleum has announced the commencement of a strategic review of the company’s ongoing projects located in the Ardmore Basin of Oklahoma.
BNK Petroleum (TSX:BKX,OTCQX:BNKPF) has announced the commencement of a strategic review of the company’s ongoing projects located in the Ardmore Basin of Oklahoma.
As quoted from the press release:
BNK Petroleum owns and operates the Tishomingo field, a strategic and highly focused shale oil property concentrated in the Southern SCOOP play/Ardmore basin of Oklahoma. BNK’s successful delineation of the Tishomingo Project has resulted in continued growth in reserves, which provide for significant growth potential as the project moves into the development phase. As such, BNK’s board of directors has determined that it is the opportune time to initiate a formal process to identify and evaluate strategic options to optimize the capitalization and growth prospects of the Company to enhance shareholder value as we move into this next phase.
A special committee of the board led by David Neuhauser as its chairman will work with management and the Company’s external advisors to supervise the review of strategic options. The special committee has a mandate to identify, examine and evaluate all strategic options and recommend to the board whether any transaction is in the best interests of BNK and its shareholders.
The board and management team believe that significant additional value can be unlocked from the Tishomingo project given the established land position, high netback oil production, low decline rates, healthy leverage position with debt to operating income of under 2.0x, attractive development locations (verified by BNK’s independent reserves auditor) and current market dynamics. As such, the review of strategic options will focus on opportunities to achieve the lowest cost of capital associated with accelerating the development of the Tishomingo project, and maximizing shareholder value. This may include a sale of assets, corporate sale or merger, joint venture, drilling fund, refinancing, recapitalization or other strategic actions that achieve the creation of additional value for shareholders.
This review may result in no specific path being pursued, with the company continuing its operations as they currently exist with a focus on the next phase of development of the Tishomingo project.