In the year since Gulf Keystone Petroleum (GKP) won its contractual dispute with Excalibur Ventures LLC, the share price of the Kurdistan-focussed oil and gas producer has oscillated in the range of 43p-189p, as takeover speculation gave way to disappointing resource estimates and payment delays from the Kurdistan regional government (KRG). There’s also the small matter of an Islamic insurgency on the doorstep.
Last week, however, GKP gave its long-suffering shareholders cause for some optimism with news that the final development plan for the Akri-Bijeel block in which GKP holds a 20 per cent working interest, has been approved. GKP said that it was engaged in “constructive discussions” with the KRG, presumably with a view to agreeing on a payment schedule for the circa $40m owed to GKP by the regional authority. GKP is also in line to benefit from further payments linked to the Excalibur case. Details on the talks with the KRG should be included in GKP’s third-quarter update due for publication on 13 November. The KRG is intent on raising Kurdish oil and gas exports from 280,000 barrels per day (bopd) to 400,000 by the end of the year, while ongoing upgrades to the dedicated pipeline to Turkey will expand capacity to 700,000 bopd. GKP, itself, is focused on raising production to around 40,000 bopd by the end of this year, although delays linked to the security situation could push that into the first quarter of next year.
