Gulf Keystone share price falls as much as 18 per cent on Kurdistan woes

 
Jessica Morris
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Gulf Keystone's share price fell as much as 18 per cent in early morning trading today, after it suspended trucked exports of crude amid a payments dispute with the Kurdish government.

The Kurdistan-focused oil producer is currently owed payments by the Kurdistan Regional Government (KRG) for exported crude.

"Though the market has taken this badly, in the short term it is not necessarily a major hit to revenues," Will Forbes, analyst at Edison Investment Research, said.

In December it signed an agreement with the KRG which it said will lead to "a stable payment cycle for crude oil sales in the future."

"We remain confident that a stable payment cycle will be established in the near term, and we expect to receive payment for all past and ongoing oil sales from Shaikan," John Gerstenlauer, Gulf Keystone's chief executive, said.

Gulf Keystone, just like its contemporaries, has had its revenues squeezed by the decline in oil prices which have fallen by 60 per cent since July last year.

"The company is taking a prudent approach to its capital expenditure in 2015 and is striving to ensure consistent and stable revenues in the short-term, which a return to the domestic market provides," Gerstenlauer said. "Meanwhile, a number of longer term financing options are currently being progressed by the Board."

Shares in the company had recovered some of their earlier losses and were trading down nine per cent at pixel time at 47 pence.

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