www.gulfkeystone.com
Gulf Keystone Petroleum Ltd. (AIM: GKP) is an independent oil and gas exploration and production company focused on exploration in the Kurdistan Region of Iraq. It holds a majority working interest in the Shaikan, Sheikh Adi and Ber Bahr exploration blocks and a further interest in the Akri-Bijeel block. Gulf Keystone is the Operator of the Shaikan and Sheikh Adi Production Sharing Contracts. Following a major discovery at Shaikan in 2009 and a discovery at Akri-Bijeel in 2010, the Company is undertaking an ambitious 2011-2012 exploration and appraisal programme across the four adjacent blocks. Gulf Keystone is also focused on continuing domestic oil sales and increasing oil export operations in order to move towards the Company’s production target of over 5,000 barrels of oil per day (“bopd”), increasing to 10,000 bopd thereafter.
Gulf Keystone shares spike to new highs as speculation continues
Gulf Keystone (LON:GKP) shares soared to a new high today on continued speculation that a significant deal is in the offing.
The shares jumped 40% at one stage as market gossip put forward a variety of names as potential partners.
A company representative wouldn’t confirm or deny the speculation.
Earlier today, Gulf Keystone clarified that the Kurdistan Regional Government still retains the option to nominate a third party to participate in the Shaikan and Akri-Bijeel production sharing contracts.
If this right is exercised then Gulf Keystone’s stake in Shaikan would fall from 75 per cent 51 per cent, while its stake in Akri-Bijeel would be reduced to 12.8 per cent from 20 per cent.
The firm has previously announced its intention to sell its stake in Akri-Bijeel, while the KRG option has also previously been discussed by the company.
Newswire reports today revisited last month’s speculation linking Exxon Mobil to the company when Gulf Keystone was forced to deny that it was in talks after a suggestion the American oil giant was lining up a £7 billion, or 800p, bid.
At that time, Gulf Keystone dismissed the speculation as unfounded, adding it remained committed to creating value for shareholders through the continuing 2011/2012 exploration and appraisal programme.
Today’s excitement also follows an upbeat progress report yesterday, in which Gulf said production had reached more than 4,000 barrels of oil a day from the extended test facility on the Shaikan block at the end of 2011.
In the same update, on Monday, GKP said the Shaikan-4 appraisal well has completed one of seven planned tests targeting the Jurassic and Triassic formations.
The company also revealed Shaikan-5 initially made slower than anticipated progress due to “stability issues encountered in the shallow formations”. However the well, which is at a depth of 1,008 metres, is now drilling ahead to a total depth of 3,500 metres.
The sixth well on the Shaikan field has now been drilled to a measured depth of 362 metres and a 26 inch casing has been set. The plan is to drill to a total depth of 3,800 metres.
Shaikan is estimated to contain 8 billion barrels of crude calculated on a P90 basis – meaning the oil has a 90 per cent certainty of being produced. The P10 value is 13.4 billion barrels, giving a mean figure of 10.5 billion barrels.
