Proceeds received for current sales from the Taq Taq field will continue to be liable for CBP. Going forward, invoices for current sales from the Taq Taq and Tawke fields will be issued and paid on the basis of the R-factor calculation in the respective PSCs, instead of the proxy formulation which has been in place since the beginning of 2016.
Tawke and Taq Taq unpaid invoices for June and July 2017 are expected to be paid in September and October 2017 respectively, in line with the payment track record established by the KRG during 2017.
Tawke field gross production has averaged c.109,000 bopd in the year to 31 July 2017, with Brent prices averaging c.$51/bbl. Assuming similar production and oil prices over the period from 1 August 2017 to 31 December 2017, the Genel Override would generate proceeds of c.$30 million and the Tawke CBP elimination would result in c.$12 million of savings in the period.
Murat Özgül (pictured), Chief Executive of Genel, said:
"A key part of our strategic focus in 2017 was the acceleration of the recovery of the receivable for unpaid oil sales, and this agreement successfully achieves this through significantly increasing cash generation from the Tawke PSC over the next five years.
"This definitive agreement is the positive culmination of a constructive dialogue with the KRG, and promises to generate value for all stakeholders."
(Sources: Genel Energy, Yahoo!)
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