Gulf Keystone suspends exports, shares plummet

Gulf Keystone Petroleum saw shares slip over 17% after suspending its crude oil exports following non-payment by the Kurdistan Regional Government (KRG).

The KRG acknowledged that money was owed to Gulf Keystone, alongside other oil producers in the region, and promised to make the payments, albeit with delays.

The above will place strains on Gulf Keystone’s $577m of debt.

In an update on the state of its operations from Shaikan, its key producing asset, the outfit said it would be restarting domestic local sales so as to maintain revenues and cash-flow.

Keystone hopes to thus alleviate short-term financial pressures.

Gulf Keystone is in talks with the KRG to reestablish a stable payment cycle for future exports, but until terms are agreed, the company is restarting domestic sales to alleviate short-term financial pressures.

Foreign sales of its crude are currently carried out by truck.

The company's chief executive officer, John Gerstenlauer, also said the company was “taking a prudent approach” to its capital expenditure in 2015.

As analysts at Westhouse Securities point out, Gulf Keystone's chief declined to give figures for how much money the company was owed.