Gulf Keystone Petroleum (GKP) made belated progress at its Shaikan block in Kurdistan through 2012, but the company's share price is being weighed down by uncertainty linked to a pending verdict over the long-running court case with Excalibur Ventures (in which Excalibur is claiming a stake in the Kurdistan assets).
The 2012 operating loss increased by 17 per cent to $82m (£60m), primarily due to legal bills over Excalibur. This was above market forecasts, but the financial results are of secondary importance as Shaikan transitions from appraisal to early production stage. The Field Development Plan is currently being assessed, but output at Shaikan (75 per cent working interest) quadrupled to 832,859 barrels through 2012. GKP is targeting production of 40,000 barrels of oil per day (bopd) by the year-end, with an initial plateau rate of 150,000 bopd achievable on near-term completion of a pipeline into the region's energy infrastructure. Elsewhere in the region, there was the discovery of Jurassic oil in the Sheikh Adi-2 exploration well, and a new Triassic oil discovery at Bakrman-1 in the Akri-Bijeel Block.
The expansion under way is being financed through a $275m convertible bond issue, but the scale of the ramp-up will obviously enhance GKP's ability to fund its activities internally.
| GULF KEYSTONE PETROLEUM (GKP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 150p | MARKET VALUE: | £1.3bn | |
| TOUCH: | 148-151p | 12-MONTH HIGH: | 259p | LOW: 127p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 65¢* | NET CASH: | $18.9m | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2008 | 1.0 | -59.3 | -18.6 | nil |
| 2009 | nil | -96.3 | -22.8 | nil |
| 2010 | 0.8 | -26.8 | -4.2 | nil |
| 2011 | 6.9 | -63.8 | -8.0 | nil |
| 2012 | 32.2 | -80.2 | -9.6 | nil |
| % change | +365 | - | - | - |
*Includes intangible assets of $546m, or 62¢ a share £1=$1.55 | ||||
