Bankers Petroleum looks to resolve Albanian tax dispute

Bankers Petroleum was pointing towards a solution for its ongoing tax battle with the Government of Albania on Wednesday, announcing it had signed a formal agreement with the country's minister of energy and industry.

An international expert audit team would review Bankers' 2011 expenditures and assess whether any of them were certifiable petroleum costs according to the agreements in place between the parties, it was agreed.

The AIM-traded firm said the determination of the expert would be binding, and the Albanian tax authority would recalculate Bankers' tax obligations for 2011 based on the determination.

Bankers said the audit was commencing immediately and concluding within the second quarter.

Both parties have committed to using the expert's determination as the basis for certifying petroleum costs in subsequent years, including the calculation of Bankers' tax obligations for 2012.

"Resolving this dispute will send a great signal that Bankers and the Government of Albania are working together to encourage investment and development," said president and CEO David French.

"We look forward to reaching an appropriate outcome, and turning our attention to continuing to manage the Patos-Marinza field for the best interest of the government, the environment, our employees, and the local Albanian communities we serve."

As a result of the parties entering into the agreement, the international arbitration that was underway would be suspended, Bankers' board confirnmed.

The Government of Albania and Bankers also committed to opening a dialogue on clarifying terms in the Petroleum Agreement and License Agreement, and review the existing fiscal terms for changes that work for both parties.