The founder of Kurdistan-focused oil company Gulf Keystone, Todd Kozel, has stepped down from the its board, the company said at its annual general meeting on Thursday, giving in to shareholder pressure.

Gulf Keystone also announced that it has promoted John Gerstenlauer from chief operating officer to chief executive, picking an insider to lead the company as it braces for difficult times amid tensions in Iraq.

In May Gulf Keystone said that Kozel, whose pay and corporate governance approach had been viewed as controversial by some shareholders, would stay on at the company as executive director, conditional on his re-election to the board.

He has now declined to stand for re-election and will instead remain at the company as an officer to maintain Gulf Keystone's relationship with the Kurdistan Regional Government.

According to media reports, Gulf Keystone shareholders had planned not to back Kozel's re-election.

"He will assist the company in every way he can and we will continue to benefit from his experience," Simon Murray, the company's non-executive chairman, said in a statement.

Gulf Keystone's flagship oil field is located at Shaikan in Iraqi Kurdistan. The company said last month that its plans to increase production at Shaikan were on track despite escalating violence in the region.

The appointment of Gerstenlauer to chief executive comes after a month-long search for a new leader. - Reuters