Gulf Keystone Petroleum Ltd (GKP) 2023 AGM, Operational &
Corporate Update 16-Jun-2023 / 07:00 GMT/BST
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16 June 2023
Gulf Keystone Petroleum Ltd. (LSE: GKP)
("Gulf Keystone", "GKP" or "the Company")
2023 AGM, Operational & Corporate Update
Ahead of today's 2023 Annual General Meeting ("AGM"), Gulf
Keystone, a leading independent operator and producer in the
Kurdistan Region of Iraq, provides an operational and corporate
update.
Jon Harris, Gulf Keystone's Chief Executive Officer, said:
"Gulf Keystone entered 2023 following a year of strong
operational and financial performance and continued delivery
against the Company's disciplined strategy of investing in
profitable production growth, sustainable shareholder returns and
maintaining a strong balance sheet. Following the suspension of
Kurdistan crude exports on 25 March 2023 and continued delays to
oil sales payments, our focus has shifted to aggressively reducing
all costs to preserve liquidity, while maintaining safe operational
readiness to quickly restart production. We are now exploring
potential options to sell our crude to local buyers.
While no timeline has been publicly announced, we continue to
believe the suspension of exports will be temporary and that the
KRG will resume more normalised payments. We are encouraged by the
ongoing engagement between the KRG, Iraq and Turkey and note the
approval earlier this week of the Iraqi Federal budget, which is a
step in the right direction towards formal recognition of Kurdistan
production by Iraq and potentially paves the way for monthly budget
transfers from Iraq to the Kurdistan Regional Government ("KRG").
We continue to closely monitor the situation.
Operational
-- Production from the Shaikan Field remains shut-in following
the suspension of exports and closure of theIraq-Turkey Pipeline on
25 March 2023? The suspension has resulted in a gross production
deferment to date of around 4.3 million barrels, orapproximately
11,800 bopd on a full-year basis (2023 gross average production
guidance prior to suspension:46,000 - 52,000 bopd)
-- Almost all operational activity in the Shaikan Field has
stopped since the pipeline closure in order topreserve liquidity?
Production facilities currently ready to resume production ? All
drilling and well workover activity halted, with the drilling rig
released following thecompletion and hook-up of SH-18 ? All
expansion activity suspended, including the installation of water
handling ? Progressing critical safety upgrades and maintenance
activity ? No Lost Time Incidents for over 150 days
-- Currently exploring opportunities to sell Shaikan Field crude
to local buyers? Potential opportunities to initially sell a
portion of PF-1 production at prices in line with thelocal market ?
Logistics in place to quickly restart trucking operations
Financial
-- The Company continues to engage with the KRG regarding
outstanding receivables for the months of October2022 to March 2023
totalling USD151 million net on the basis of the KBT pricing
mechanism
-- Net capital expenditures to the end of May 2023 are estimated
at USD49 million, including completion ofSH-17 and SH-18, well
workovers, well pad preparation, long lead items and expansion of
production facilities
-- Cash balance of USD93 million at 15 June 2023
Outlook
-- The Company continues to believe that the suspension of
exports will be temporary and that the KRG willresume more
normalised payments? While no official timeline to restart pipeline
operations has been announced, the Company understandsthat
discussions between the KRG, the Iraqi Ministry of Oil and the
Turkish authorities remain ongoing ? The KRG announced that it had
reached an agreement with the Iraqi government on measures to allow
theresumption of oil exports through Turkey, and also reported that
Iraq's State Oil Marketing Organization("SOMO") had officially
requested Turkish authorities to allow Kurdistan's oil exports via
the country's Ceyhanport ? Iraq's parliament recently approved the
2023-2025 Federal Iraqi budget, a step towards formalrecognition of
Kurdistan production by Iraq and potentially paving the way for
monthly budget transfers fromIraq to Kurdistan ? The Company
continues to monitor the situation and is currently ready to resume
production
-- The Company remains focussed on preserving liquidity while
proactively managing existing accounts payable
-- Lowering net capital expenditures, operating costs and
G&A to a monthly run rate of around USD6 million netfrom July
2023? 2023 net capex currently estimated at USD70-USD75 million
(previously revised guidance of USD80-USD85million)? Estimated
USD49m net capex Jan-May 2023; estimated USD20-USD25m of safety
critical and contractualcommitments remaining for Jun-Dec 2023 ?
20% deferral of Executive Director salaries & Non-Executive
Director fees and reduced staffing andcontractor levels ? Final
2022 ordinary annual dividend of USD25 million cancelled, as
announced on 23 May 2023, with thereinstatement of distributions to
be considered once regular KRG payments resume
-- Continuing to review additional liquidity options, including
local crude and inventory sales and furthercost reductions
2023 AGM
Gulf Keystone is today hosting its 2023 AGM at 10am CET via
webcast. It will not be possible to attend the meeting in person
but all registered Gulf Keystone shareholders are invited to view
the webcast at the following link: http://
meetnow.global/gkpagm2023. Joining instructions are available on
Gulf Keystone's website: https://www.gulfkeystone.com/
investors/agm/.
The AGM will be hosted by Jaap Huijskes, Non-Executive Chairman,
and Martin Angle, incoming Non-Executive Chairman and current
Deputy Chairman and Senior Independent Director. It will include a
presentation by Jon Harris, Chief Executive Officer, and Ian
Weatherdon, Chief Financial Officer. A copy of the presentation
will be available to view on the Investors section of Gulf
Keystone's website
(https://www.gulfkeystone.com/investors/presentations). A recording
of the presentation will also be available to view on the same page
later in the day following the conclusion of the AGM.
Enquiries:
Gulf Keystone: +44 (0) 20 7514 1400
Aaron Clark, Head of Investor Relations 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.
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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: MSCM
TIDM: GKP
LEI Code: 213800QTAQOSSTNTPO15
Sequence No.: 251300
EQS News ID: 1658553
End of Announcement EQS News Service
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(END) Dow Jones Newswires
June 16, 2023 02:00 ET (06:00 GMT)
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