Iraqi Kurdistan pays Gulf Keystone, pleasing producers
LONDON, October 15, 2015
Gulf Keystone Petroleum has said it had been paid for oil exports by the government of Iraqi Kurdistan, a sign it is serious about making regular payments to producers after months of debt building up.
Gulf Keystone said it had received a $15 million gross payment for crude exports from its Shaikan oil field. This follows a payment of the same amount made in September.
Signs of a regular payments reassured investors that the company will be able to stay afloat as weak oil prices provide additional pressure to the balance sheet.
"The establishment of a regular payment cycle is crucial for attracting a farm-in partner or strategic investor to pursue the next stage of development at the Shaikan field," said analysts at Mirabaud Securities.
Shares in GKP were trading up 4.3 per cent at 1030 GMT.
"Today's payment is another important step towards the regular payment cycle, and is in keeping with the Ministry of Natural Resources' recent assurances," said GKP chief executive Jon Ferrier, whose company had arrears of $283 million in late June.
A source close to fellow Iraqi Kurdistan oil producer Genel said the company was expecting a payment shortly.
Genel, whose shares were up three per cent, declined to comment.
Norway's DNO, which is also active in the region, was not immediately available for comment. Its stock was trading up seven per cent in Oslo.
The Kurdistan Regional Government promised in September it would start making regular payments for oil exports.
The KRG has increased its own crude sales since mid-June, cutting allocations to Iraq's state oil marketing firm SOMO in an ongoing tug-of-war over export rights and budget payments.
The dispute has plunged the region into financial crisis compounded by the drop in oil prices. - Reuters
