Gulf Keystone Petroleum blames market constraints for downward revision.
Gulf Keystone Petroleum lowers forecast for production rates from its assets in the Kurdish north of Iraq
LONDON, July 9 (UPI) — British energy company Gulf Keystone Petroleum said Thursday it was lowering its production expectations from Kurdish assets because of adverse market factors.
The company operates the Shaikan reserve area in the Kurdish north of Iraq, where it says the capacity exists for production rates of more than 43,000 barrels per day. In a statement, the company said “potential offtake and market constraints” prompted adownward revision for that rate.
Chief Executive Officer Jon Ferrier said work was geared toward setting up a regular payment cycle for crude oil sales for Shaikan, noting the company had received $6.7 million already and production rates were stable at 38,000 bpd in June.
“Taking into account the suspension of production operations earlier in the year due to external market factors, today’s performance allows us to exit the year at an average rate of between 30,000 and 34,000 bpd, subject to future market factors,” he said in a statement.
In early 2015, the company suspended crude oil exports through Turkey and directed sales to the local market because of a lack of payment from the Kurdish government. With payment commitments from the Kurdish government in hand, the company said it has a six-month contract for domestic sales and exports between 12,000 and 40,000 bpd by truck across the border to the Turkish coast.
The company is among those struggling to navigate a weak market for crude oil. Net losses for the company were substantial. The company said revenues for full-year 2014 were $38.6 million, but it was owed another $100 million for crude oil export sales.
Top executives in April said “all avenues” are open for rebuilding shareholder value. Chief Financial Officer Sami Zouari said Thursday the company will “have to weather the storm until political and commercial stability are achieved.”
Source: United Press International (UPI) July 9, 2015 at 7:00 AM