Kurdistan oil producers Genel Energy (GENL) and Gulf Keystone Petroleum (GKP) are on the charge – up 6.9% to 366.5p and 6.6% to 30.9p respectively - as the government in the semi-autonomous part of Iraq appears to deliver on a pledge to commence regular payments for crude exports.
An announcement from Gulf Keystone reveals a net payment from the Kurdistan Regional Government (KRG) of $12 million for exports from its Shaikan field (following a similar payment in September) and as the company comments ‘is in line with the statements made by the KRG in August and September 2015 regarding regular payments to the exporting international oil companies in the region’.
As broker Cantor Fitzgerald notes it is not the payment itself but the fact that it has been made at all which is significant. ‘Albeit a small payment in the context of the outstanding receivable due to the company… we believe shareholders will take comfort from the KRG clearly establishing a regular payment cycle to its domestic producers.’
The payment brings the company’s cash to $76.2 million and, in line with existing debt payment obligations, it is set to make interest payments of $26.4 million.