Gulf Keystone Raises $175m in Surprise Placing

He said the company had $91.9m in cash after raising $189m from investors in the first half to fund drilling and exploration at its concessions in Kurdistan, northern Iraq.

Gulf Keystone, which has yet to turn a profit and has no proved reserves, said that its assets hold between 1.9bn and 7.4bn barrels of oil.

The company’s shares surged 850 per cent from August to October last year after the discovery of oil at Shaikan – helping Gulf Keystone attract a dedicated retail investor following and making it one of the most discussed shares on the UK’s online investment bulletin boards.

Despite management statements to the contrary, several analysts predicted that it would seek more funds this year.

Richard Nolan, an oil analyst at Daniel Stewart, told the FT he was surprised by the placement.

“Clearly it’s a stunning development – this goes well beyond what we were originally talking about. They were saying we were fully funded and now they say they want this money, but that’s because they have a good story to tell,” said Mr Nolan.

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