Gulf Keystone Gets $15 Million Oil Payment, Doesn't Need Deal - Update
January 23 2017 - 10:39AM
Dow Jones News
(Updates with Chief Executive comment, more detail, updated
share price)
By Philip Waller
LONDON--The chief executive of Gulf Keystone Petroleum Ltd.
(GKP.LN) Monday said his company doesn't need a takeover deal to
grow the business, but he would be willing to consider any sensible
offer.
Analysts have said the company, an oil producer in Iraqi
Kurdistan, is more attractive as an investment proposition after it
completed a debt restructuring in October.
Last month, its shares rose following reports that Chinese oil
major China Petroleum & Chemical Corp., or Sinopec Ltd., had
made a takeover approach for the group.
CEO Jón Ferrier said the company would have welcomed a farm-in
deal when it was facing financial problems, though the debt
shake-up had changed that.
"That's not the case any more and we don't need a deal," Ferrier
told Dow Jones Newswires in a telephone interview.
"But I know that if someone comes along and makes a sensible
offer, of course I'll put it to the board."
Gulf Keystone earlier Monday said it has received $15 million
from the Kurdistan Regional Government for oil sales made in
October.
The group, which produces 40,000 barrels of oil a day from its
Shaikan field in the semi-autonomous region of Iraq, said it has
$106.1 million of cash after receiving the payment.
Gulf Keystone has been receiving regular oil-related payments
from the KRG since September 2015, albeit with delays.
The company remains in talks with the regional government about
further potential payments to which it claims to be entitled for
past oil production and field development costs.
Mr. Ferrier said Gulf Keystone is in a good position because it
is cash-flow positive and because the Kurdistan government knows
that keeping up payments to oil producers is important to the
region's credibility with investors.
Kurdistan is under-explored with relatively low exploration
costs, oil prices are stable and members of the Organization of the
Petroleum Exporting Countries appear to be in agreement about
proposed production cuts, Mr.Ferrier said.
"There's still [likely to be] nice, steady oil demand for some
years to come so Kurdistan is among the most attractive investment
destinations," he said.
At 1418 GMT, shares in Gulf Keystone were up 1.7 pence, or 1.3%,
at 131.5 pence.
-Write to Philip Waller at philip.waller@wsj.com
(END) Dow Jones Newswires
January 23, 2017 10:24 ET (15:24 GMT)
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