By John Lee.
Gulf Keystone Petroleum (GKP) has given an update this morning on its operations at Shaikan, its key producing asset. Shares in the company are up more than 70 percent from their low in October.
The Company is on track to complete all remaining work in order to achieve 40,000 gross barrels of oil per day ("bopd") of production capacity from the Shaikan production facilities ("PF-1" and "PF-2") by the end of 2014.
The total production levels are stable, averaging 23,000 gross bopd from three wells at PF-1 and two wells at PF-2. The civil works are ongoing to connect the Shaikan-7 and -8 wells to PF-1. The trenching work has been completed on the 15 km connection between the Shaikan-10 well and PF-2 and the flowlines are currently being laid.
Shaikan crude oil exports by truck to the Turkish coast have continued uninterrupted since 29 November 2013. All of our production is currently being exported and nineteen tanker cargoes totalling 4.7 million gross barrels of Shaikan crude oil have been sold to the international market since the Shaikan crude oil export sales began from the port of Dortyol in January 2014.
The Company welcomes the announcement made by the Kurdistan Regional Government's Ministry of Natural Resources on 7 November 2014 regarding the plan to make an initial payment of US$75 million on account to producers for exports in November 2014, with further payments to follow on a regular basis. The announcement can be viewed at http://mnr.krg.org/index.php/en/press-releases/422-update-on-oil-export-from-the-kurdistan-region-of-iraq.
The management team will host a conference call for analysts and investors at 11am UK time today. A live audio webcast of the call will be available on the Company's website www.gulfkeystone.com.
John Gerstenlauer, Gulf Keystone's Chief Executive Officer commented:
"Gulf Keystone's production operations and export oil sales have continued uninterrupted in 2014. All current production is being exported by truck and these exports are set to increase in the coming months as we are nearing our production target of 40,000 bopd.
"As we stand by the Kurdistan Region and its people, we welcome the KRG's commitment to putting in place a regular payment cycle for oil exports from the region. As our production increases, we look forward to receiving our full contractual entitlement."
(Sources: Gulf Keystone, Yahoo!)