REG-Gulf Keystone Petroleum Ltd Shaikan Payment Update

Gulf Keystone PetroleumAnnouncement

09/03/2023 07:15

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   Gulf Keystone Petroleum Ltd (GKP)
   Shaikan Payment Update

   09-March-2023 / 07:00 GMT/BST

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   9 March 2023

                                        

                                        

                    Gulf Keystone Petroleum Ltd. (LSE: GKP)

                   (“Gulf Keystone”, “GKP” or “the Company”)

                                        

                             Shaikan Payment Update

                                        

    

   Gulf Keystone  confirms  that a  gross  payment of  $34.3  million  ($26.9
   million net  to  GKP)  has  been  received  from  the  Kurdistan  Regional
   Government ("KRG") for Shaikan crude oil sales during September 2022.

    

   The payment reflects a new pricing  mechanism proposed by the Ministry  of
   Natural Resources  (“MNR”)  for  Shaikan  crude  oil  sales,  effective  1
   September 2022. Under  this mechanism,  the realised  price for  September
   reflects the average price for the Kurdistan Blend (“KBT”) sold by the KRG
   at Ceyhan in Turkey,  adjusted for a  quality discount and  transportation
   costs for use of export pipelines.

    

   For Shaikan crude oil sales in  September 2022, the new pricing  mechanism
   results in an approximately $11/bbl reduction in the realised price versus
   the previous pricing  mechanism leading to  a discount to  Dated Brent  of
   approximately $34/bbl. The impact on net payment is $5.3 million.

    

   The following table  summarises pricing information  for KBT published  by
   the KRG for the months from September 2022 to January 2023, including  the
   impact on Shaikan realised prices versus the previous pricing mechanism:

    

   ($/bbl)                          Sep-22 Oct-22 Nov-22 Dec-22 Jan-23
   Dated Brent                          90     93     92     81     83
   KBT                                  72     75     72     63     67
   Impact on Shaikan realised price   (11)   (12)   (13)   (12)   (10)

    

   If the  new pricing  mechanism  had been  in  place throughout  2022,  the
   reduction in monthly Shaikan realised prices would have ranged from $4/bbl
   to $13/bbl versus the previous pricing mechanism, assuming KBT crude specs
   during Q3  2022  were  representative  of  those  during  H1  2022.  Given
   fluctuations between Dated Brent and KBT, and the widening differential in
   2022 driven in part by competition with heavily discounted Russian  crude,
   the future KBT discount to Dated  Brent, and associated impact on  Shaikan
   realised prices, is uncertain.

    

   The Company  continues  to engage  with  the MNR  regarding  the  proposed
   pricing mechanism and amendment to the Shaikan Lifting Agreement.

    

    

   Enquiries:

   Gulf Keystone:                          +44 (0) 20 7514 1400  
   Aaron Clark, Head of Investor Relations  1 aclark@gulfkeystone.com
                                            
   FTI Consulting                          +44 (0) 20 3727 1000
   Ben Brewerton
                                            2 GKP@fticonsulting.com
   Nick Hennis

    

   or visit:  3 www.gulfkeystone.com

    

   Notes to Editors:

    

   Gulf Keystone Petroleum Ltd. (LSE: GKP) is a leading independent  operator
   and producer in the Kurdistan Region of Iraq. Further information on  Gulf
   Keystone is available on its website  4 www.gulfkeystone.com

    

   Disclaimer

    

   This announcement  contains certain  forward-looking statements  that  are
   subject to  the risks  and uncertainties  associated with  the oil  &  gas
   exploration and production  business.  These  statements are  made by  the
   Company and its Directors in good faith based on the information available
   to them up to  the time of  their approval of  this announcement but  such
   statements should  be  treated with  caution  due to  inherent  risks  and
   uncertainties, including both economic and business factors and/or factors
   beyond the Company's control  or within the  Company's control where,  for
   example, the  Company decides  on  a change  of  plan or  strategy.   This
   announcement has been prepared solely to provide additional information to
   shareholders to assess the Group's strategies and the potential for  those
   strategies to succeed.  This announcement should  not be relied on by  any
   other party or for any other purpose.

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   Dissemination of a Regulatory Announcement, transmitted by EQS Group.
   The issuer is solely responsible for the content of this announcement.

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   ISIN:          BMG4209G2077
   Category Code: MSCM
   TIDM:          GKP
   LEI Code:      213800QTAQOSSTNTPO15
   Sequence No.:  228497
   EQS News ID:   1578129


    
   End of Announcement EQS News Service

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References

   Visible links
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   2. mailto:GKP@fticonsulting.com
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