BNK Petroleum Inc. Announces 1st Quarter 2011 Results

Camarillo, California (ots/PRNewswire) -

2011 (a) 2010 (a) %
Earnings (Loss):
$ Thousands ($115) $289 L
$ per common share assuming - - L
dilution
Capital Expenditures $4,310 $1,323 226
Average production per day 1,327 1,085 22
(Boepd)
Average Product Price per $45.63 $47.49 (4)
Barrel
Average Netback per Barrel $26.16 $25.25 4
3/31/2011 (a) 12/31/2010 (a) 3/31/2010 (a)
Cash and Cash Equivalents $58,530 $62,062 $3,841
Working Capital $61,443 $63,503 ($14,538)

BNK's President and CEO Wolf Regener commented:

"BNK's average production per day increased 22% and its revenues
increased 18% in the first quarter of 2011 versus the first quarter
of 2010. The net loss of $.1 million in the current quarter versus
net income of $.3 million in the first quarter of 2010 was the result
of unrealized hedging losses of $.8 million primarily on crude oil in
the current quarter versus unrealized hedging gains of $.5 million on
natural gas in the first quarter of 2010, higher general and
administrative expenses (primarily payroll) of $.4 million, lower
exploration and evaluation expenditures of $.6 million relating to
the decision to abandon the Black Warrior Field in Alabama last year,
partially offset by currency gains of a net $1.2 million between
quarters due to the strong Canadian dollar. Production from the
Tishomingo field has been extremely consistent with virtually no
decline in the last three months. Production has been averaging over
1,350 boepd net to BNK since the beginning of March. Beginning in
June an additional hydraulic fracture stimulation program will begin
which will continue throughout the rest of the year and is expected
to increase production.

In Poland through Saponis Investments Sp z o.o. where the Company
is manager, we completed the drilling of the Wytowno #1 well in
February and in April completed the drilling of the Lebork S-1
vertical well. Completion activity will not begin until core analysis
and log interpretations are completed and zones of interest will be
fracture stimulated and flow tested. The Starogard S-1 well currently
has an anticipated drilling start date in June 2011. The Company,
through Saponis, has begun constructing the location for the
Starogard S-1 well, which is expected to spud in late June. The
Company is awaiting analysis of the Lebork S-1 and Wytowno #1 well
cores from the Lebork S-1 and Wytowno #1 wells from the 3rd party
laboratories, which has taken much longer than originally
anticipated. BNK has heard from a number of laboratories that
turnaround time on core work is now normally four months or more due
to their volume of work. In Poland the Company is waiting for
approval to acquire about 650 km of 2D seismic on the six concessions
in Poland and hopes to be able to begin that acquisition later this
summer. On its 100% owned Indiana concessions the Company has
negotiated 3 surface locations where signed agreements are expected
shortly for its first three wells on those concessions.

In Germany, the Company initiated the bidding process for the 2D
seismic operations on its six concessions which will provide the
necessary information for its drilling program next year. The seismic
acquisition is planned for the late 2011/early 2012.

In Spain the Company through its wholly owned subsidiary Trofagas
Hidrocarburos, S.L. was awarded an oil and gas concession totaling
61,470 acres bringing BNK's total acreage in Europe to about 3.6
million net acres in 5 separate basins. This summer the Company
intends to conduct field work which will consist of additional
detailed outcrop work to characterize original basin geometries and
predict subsurface depositional trends. In addition the company is
currently working on incorporating existing 2D seismic data into its
basin model.

BNK's first quarter condensed interim consolidated financial
statements were prepared by management in accordance with
International Accounting Standard ("IAS") 34, "Interim Financial
Reporting". As a result the company recorded a non-cash adjustment to
reduce the carrying value of property, plant and equipment to
accumulated deficit by $56.9 million effective January 1, 2010".

FIRST QUARTER HIGHLIGHTS

- Average production per day increased 22% to 1,327 boepd

- Comparative first quarter revenues increased 18% to $5,450,000
from $4,637,000 in the first quarter of 2010

- Average per barrel netbacks increased 4% to $26.16 from $25.25
in the first quarter of 2010

- Yearend reserves increased 31% to $315 million using an
estimated present value of 10% on future revenues

- Proved and probable reserves increased 5% to 39.7 million boe

- Cash and Working Capital totaled $58.5 million and $61.4
million respectively

- As manager for Saponis Investments Sp z o.o. BNK completed
drilling its first well in Poland and began drilling its second well

- Plans were set in place to shoot 2D seismic in Germany in the
second half of this year

First Quarter 2011 versus First Quarter 2010

Oil and Gas revenues totaled $5,450,000 in the quarter versus
$4,637,000 in the first quarter of 2010. Oil revenues increased
$439,000 or 26% as oil production per day increased 12% to 255 boepd
while average oil prices increased $10.11 per barrel or 12% to
$91.83. Natural Gas Liquids (NGL's) revenues increased $331,000 or
18% as NGL production increased 20% to 550 boepd while average NGL
prices fell 2% or 83 cents to $44.29. Natural Gas revenues increased
$43,000 or 4% to $1,148,000 as natural gas production increased by
731 metric cubic feet per day (mcf/d) to 3,132 while average natural
gas prices fell $1.04 an mcf or 20% to $4.07.

Gathering revenues in the quarter totaled $501,000 versus
$1,530,000 as last years total benefited from a correction of an
error in 2009 increasing first quarter 2010 gathering revenue by
$1,150,000

In the first quarter of 2011 BNK incurred unrealized hedging
losses of $842,000 of which $798,000 related to hedges on crude oil
while in the first quarter of 2010 BNK recorded unrealized hedging
gains of $455,000 entirely relating to natural gas

Operating expenses increased $120,000 or 10% to $1,303,000 due to
higher production taxes and field maintenance costs due to higher
production. On a per barrel basis operating expenses declined 10% to
$10.91 per barrel from $12.11 per barrel

Exploration and Evaluation Expenditures totaled $643,000 in the
quarter as BNK paid $500,000 in liquidated damages due to its
decision to not drill a third well in the Black Warrior acreage in
Alabama

General and administrative expenses increased $382,000 or 23%
primarily due to higher payroll related costs.

In the quarter BNK recorded a $1,313,000 currency gain due to the
rising Canadian dollar versus the US Dollar

Capital expenditures in the quarter totaled $4,310,000 and
related primarily to frac, drilling and leasing costs in Oklahoma of
$3,000,000 and drilling costs in Poland of $1,000,000

Three months
ended March 31
($000's) 2011 2010
Oil and Gas Revenue net of Royalties $4,428 $3,648
Other Income 531 1,530
4,959 5,178
Exploration and Evaluation Expenditures 643 1,267
Production and Operating expenses 1,303 1,183
Depletion and Depreciation 1,189 836
General and Administrative Expenses 2,025 1,643
$5,160 $4,929
Results from Operations (201) 249
Finance Income 1,364 567
Finance Expense (1,278) (527)
Net Finance Income 86 40
Net Income (loss) and comprehensive Income
(loss)
for the period ($115) $289
Income (Loss) per share $0.00 $0.00
BNK Petroleum Inc.
($000 except as noted)
1st QUARTER
2011 2010
Oil revenue before royalties $2,110 $1,671
Gas revenue before royalties 1,148 1,105
NGL revenue before royalties 2,192 1,861
Oil and Gas revenue 5,450 4,637
Cash flow provided (used) by operating 2,843 (3,426)
activities
Additions to property, plant & equipment (4,310) (1,323)
Cash Proceeds of Stock Options Exercised 382 109
Repayment of Long term debt - (1,323)
Statistics:
Average natural gas production (mcf/d)
Average NGL production (Boepd) 3,132 2,401
Average Oil production (Bopd) 550 458
Average production (Boepd) 255 227
Average natural gas price ($/mcf) 1,327 1,085
Average NGL price ($/bbl) 4.07 5.11
Average oil price ($/bbl) 44.29 45.12
91.83 81.72
Average price per barrel
Royalties per barrel $45.63 $47.49
Operating expenses per barrel 8.56 10.13
Netback per barrel 10.91 12.11
$26.16 $25.25

($000's) March 31 December 31 March 31
2011 2010 2010
Cash $58,530 $62,062 $3,841
Trade and Other Receivables 19,009 18,398 5,380
Other Current Assets 1,036 1,079 1,777
Total Current Assets 78,575 81,539 10,998
Property, Plant and Equipment 134,770 132,413 108,369
Exploration and Evaluation Assets 3,220 2,345 1,325
Total Non-current assets 137,990 134,758 109,694
Total Assets $216,565 $216,297 $120,692
Trade and other payables $16,824 $18,036 $13,289
Current portion long-term debt - - 1,750
Other Current liabilities $308 - 10,497
Total Current Liabilities 17,132 18,036 25,536
Loans and Borrowings 19,518 19,486 16,216
Subordinated Debt - - 2,788
Other non-current liabilities 2,243 1,935 1,680
21,761 21,421 20,684
Share Capital 246,885 246,240 142,028
Contributed surplus 11,813 11,511 9,388
Deficit (81,026) (80,911) (76,944)
Total Equity 177,672 176,840 74,472
Total Equity and Liabilities $216,565 $216,297 $120,692

The information outlined above is extracted from and should be
read in conjunction with the Company's unaudited financial statements
for the three months ended March 31, 2011 and the related
management's discussion and analysis thereof, copies of which are
available under the Company's profile at www.sedar.com.

Non-IFRS Information

Netback per barrel and its components are calculated by dividing
revenue, royalties and operating expenses by the Company's sales
volume during the period. Netback per barrel is a non-IFRS measure
but it is commonly used by oil and gas companies to illustrate the
unit contribution of each barrel produced. This is a useful measure
for investors to compare the performance of one entity with another.
The non-IFRS measures referred to above do not have any standardized
meaning prescribed by IFRS and therefore may not be comparable to
similar measures used by other companies.

The Company also uses the "barrels" (bbls) or "barrels of oil
equivalent" (boe) reference in this report to reflect natural gas
liquids and oil production and sales. All boe conversions are derived
by converting gas to oil in the ratio of six thousand cubic feet of
gas to one barrel of oil, representing the approximate energy
equivalency.

Caution Regarding Forward-Looking Information

Certain statements contained in this news release constitute
"forward-looking information" as such term is used in applicable
Canadian securities laws, including information regarding the
proposed timing and expected results of exploratory work,
commencement of drilling, and concession applications.
Forward-looking information is based on plans and estimates of
management at the date the information is provided and certain
factors and assumptions of management, including that all required
permits and approvals, funding from co-venturers and the necessary
labor and equipment will be obtained, provided or available, as
applicable, when required. Forward looking information is subject to
a variety of risks and uncertainties and other factors that could
cause plans, estimates, timing and actual results to vary materially
from those projected in such forward- looking information. Factors
that could cause the forward-looking information in this news
release to change or to be inaccurate include, but are not limited
to, the risk that permits, approvals, equipment and/or funding are
delayed or available only on terms that are not acceptable to the
Company, political and currency risks and other risks associated
with exploration and development of oil and gas projects, including
those set forth in the Company's management's discussion and
analysis and annual information form filed under the Company's
profile on http://www.sedar.com.

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, Poland,
Germany and Spain. Additionally the Company is utilizing its
technical and operational expertise to identify and acquire
additional unconventional projects outside of North America. The
Company's shares are traded on the Toronto Stock Exchange under the
stock symbol BKX.

For further information:

Wolf E. Regener, President and Chief Executive Officer
+1(805)484-3613 Email: investorrelations@bnkpetroleum.com

Website: http://www.bnkpetroleum.com

ots Originaltext: BNK Petroleum Inc.
Im Internet recherchierbar: http://www.presseportal.de

Contact:
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