Gulf Keystone Petroleum takes encouragement from Kurdistan payment

Iraq oil developer Gulf Keystone Petroleum has received a payment from the Kurdistan Regional Government for its most recent invoice, increasing hope that its considerable arrears will also be satisfied in the coming year.

Having received three consecutive monthly payments, Gulf Keystone said it now expects the KRG to continue making payments in a regular manner and that all its arrears totalling $298.4m net to the company "will be considered for payment in 2016".

The November payment for oil from the Shaikan field of $15m will see a net $12m received by Gulf Keystone and takes its current cash position to $54.6m.

GKP said its previously announced full year production guidance for the Shaikan field of 30,000-34,000 barrels of oil per day remains unchanged, while the company continues to exercise a prudent approach to all expenditure, cutting the costs across the organisation.

"We continue to drive the company forward with three principal strategic objectives: safe and reliable operations, commercial sustainability of the business achieved through regular monthly payments and addressing of the arrears, and constructive relationships with our host government, shareholders and bondholders," said chief executive Jón Ferrier.

"We have made substantial progress on a number of fronts during 2015, including the 114% increase in the company's 2P reserves, and maintained stable production levels throughout the year."