DJ Operational & Corporate Update
Gulf Keystone Petroleum Ltd (GKP)
Operational & Corporate Update
13-Dec-2023 / 07:00 GMT/BST
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13 December 2023
Gulf Keystone Petroleum Ltd. (LSE: GKP)
("Gulf Keystone", "GKP", "the Group" or "the Company")
Operational & Corporate Update
Gross average sales of c.28,800 bopd since last market update on 25 September
Local sales continuing to cover monthly costs despite fluctuation in volumes
Gulf Keystone, a leading independent operator and producer in the Kurdistan Region of Iraq, today provides an
operational and corporate update.
Jon Harris, Gulf Keystone's Chief Executive Officer, said:
"We remain focused on preserving liquidity by maximising local sales, maintaining strict cost control and proactively
managing accounts payable. We have continued to more than cover our monthly costs of around USD6 million and while local
market demand remains difficult to predict and we have seen volumes fluctuate, we continue to pursue opportunities to
increase sales. There remains no official timeline for the reopening of the Iraq-Turkey Pipeline but political and
commercial negotiations between the Kurdistan Regional Government and the Government of Iraq are progressing and we
believe the situation will be resolved. As an industry, we are emphasising the importance of payment surety for past
and future oil exports and the preservation of our current Production Sharing Contract economics."
Operational
-- Rigorous focus on safety maintained
- No lost time incidents for over 330 days
-- Local sales of Shaikan Field crude continue in absence of pipeline exports
- Gross average sales of c.28,800 bopd via trucking and pipeline between the date of our last market
update, 25 September, and 11 December, reflecting: c.30,000 bopd in September, c.37,200 bopd in October,
c.21,500 bopd in November and c.21,900 bopd between 1-11 December
- Fluctuation in volumes primarily reflects competition with increased supply from other producers in
the region, associated refinery capacity constraints and seasonal effects on crude demand
- Realised prices have continued to average around USD30/bbl, in line with local market pricing, while
the Company is receiving advance payments for its net entitlement of 36% of gross sales revenue
Financial
-- Current local sales volumes and realised prices continue to enable GKP to more than cover its estimated
monthly costs of around USD6 million in H2 2023 (breakeven at gross sales of c.18,500 bopd and USD30/bbl)
-- Cash balance of USD85 million at 12 December 2023 with no debt
Outlook
-- The Company remains focused on preserving liquidity by maximising local sales, maintaining strict cost
control and proactively managing accounts payable
-- Opportunities to increase local sales continue to be pursued; nonetheless, local market demand remains
variable
-- Estimated monthly net capex, operating costs and other G&A in H2 2023 remain around USD6 million, in line
with expectations
-- Expect to maintain monthly capex and cost run rate of around USD6 million into 2024
-- The Company continues to believe that pipeline exports will restart:
- Political and commercial negotiations between the Government of Iraq ("GOI") and the Kurdistan
Regional Government ("KRG") are ongoing
- The Association of the Petroleum Industry in Kurdistan ("APIKUR"), of which GKP is a founding member,
continues to engage with the KRG and has recently met with the GOI
- We continue to emphasise the importance of payment surety for past and future oil exports and that
the current economics of the Production Sharing Contracts ("PSCs"), which are governed by English Law, must be
preserved
Board composition
The Board remains committed to meeting the required targets on independence and diversity under the 2018 UK Corporate
Governance Code, which the Company voluntarily adheres to, and UK Listing Rules. It is currently engaged in an
independent non-executive director search process to ensure compliance. However, the pace of the process has been
controlled to reflect the Company's current focus on cost reduction and liquidity preservation.
2023 AGM shareholder consultation
The Company has conducted a shareholder consultation following the voting at the 2023 AGM. The summary of the
consultation is available on GKP's website: www.gulfkeystone.com/investors/agm/.
Enquiries:
Gulf Keystone: +44 (0) 20 7514 1400
Aaron Clark, Head of Investor Relations
& Corporate Communications aclark@gulfkeystone.com
FTI Consulting +44 (0) 20 3727 1000
Ben Brewerton
GKP@fticonsulting.com
Nick Hennis
or visit: www.gulfkeystone.com
Notes to Editors:
Gulf Keystone Petroleum Ltd. (LSE: GKP) is a leading independent operator and producer in the Kurdistan Region of Iraq. Further information on Gulf Keystone is available on its website www.gulfkeystone.com
Disclaimer
This announcement contains certain forward-looking statements that are subject to the risks and uncertainties associated with the oil & gas exploration and production business. These statements are made by the Company and its Directors in good faith based on the information available to them up to the time of their approval of this announcement but such statements should be treated with caution due to inherent risks and uncertainties, including both economic and business factors and/or factors beyond the Company's control or within the Company's control where, for example, the Company decides on a change of plan or strategy. This announcement has been prepared solely to provide additional information to shareholders to assess the Group's strategies and the potential for those strategies to succeed. This announcement should not be relied on by any other party or for any other purpose.
----------------------------------------------------------------------------------------------------------------------- Dissemination of a Regulatory Announcement, transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.
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ISIN: BMG4209G2077 Category Code: MSCH TIDM: GKP LEI Code: 213800QTAQOSSTNTPO15 Sequence No.: 291537 EQS News ID: 1795511 End of Announcement EQS News Service =------------------------------------------------------------------------------------
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(END) Dow Jones Newswires
December 13, 2023 02:00 ET (07:00 GMT)
