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Independent producers in Iraqi Kurdistan are struggling to maintain output, and expansion plans, in the face of at-best delayed payments for their output. The KRG, for its part, blames Baghdad.
Gulf Keystone Petroleum (GKP) has resumed production and truck exports from its 40,000 b/d Shaikan oil field in Iraq’s semi-autonomous Kurdistan region. The UK-listed independent, which has struggled with mounting debts due to non-payment by Erbil for past exports of Shaikan crude, stopped production and exports from the field in mid-February, but has since received pre-payment for future exports.
GKP, which has put itself up for sale, says the resumption of production and truck loadings from Shaikan follows a pre-payment of $26mn, of which $20.8mn is net to the company, by the Kurdistan Regional Government (KRG) on 25 February. This leaves the company with a cash balance of $90.04mn, which would keep the company afloat but leaves it exposed should holders of $250mn in notes refuse to agree to a proposed change to the terms of the 13% bonds maturing in 2017.
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