Investors reacted with disdain to Bankers Petroleum's decision to spin off its United States gas business, sending the company's shares 7 per cent lower in morning trade.
Bankers had previously announced it would break itself into two companies, and Thursday shares of the newly formed BNK Petroleum Inc. started trading on the TSX. Investors pushed BNK shares five per cent higher from its opening price in early trading.
BNK Petroleum was created to focus on a gas field in Oklahoma, and intends to drill 30 wells in the United States by the end of the year. It will trade under the stock symbol "BKX."
"With recent success in Oklahoma, the company determined that the timing is right for Bankers U.S. to be restructured into a separate entity to proceed with its own growth plans," Calgary-based Bankers said.
The original company kept the Bankers Petroleum name, and will focus on Albanian oil fields which currently produce 5,500 barrels of crude a day. The decision to split the company was made after its proven Albanian resources increased by 19 per cent - or 54 million - earlier this year.
Bankers intends to spend $370-million developing its Albanian properties, and has a production target of 20,000 barrels per day by the end of 2010.