Gulf Keystone plummets as debt repayment fears mount

Jessica Morris
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Iraqi Kurdistan Starts Oil Exports
Gulf Keystone operates in Iraqi-Kurdistan (Source: Getty)

Shares in Gulf Keystone Petroleum tumbled today after the Kurdistan-focused oil producer warned that it could miss a bond payment later this month.

The London-listed company said it would utilise a grace period regarding payments that are due 18 April on bonds which expire 2 May and 3 May respectively.

Its shares fell as much as 33.1 per cent to 4.7p on the announcement, before recovering slightly to around 5.4p.

"The additional detail on the potential interim investment scenarios being released today ensures an orderly market, and represents an important step as we prepare to embark upon detailed discussions with stakeholders," chief executive, Jón Ferrier, said.

"We are working to achieve the best possible way to restructure our balance sheet. Addressing our funding needs will ensure the Company's longer term future and ability to continue developing the Shaikan field for the benefit of all our stakeholders."

Gulf Keystone is hamstrung by large debts that it took on when oil prices were high. While its woes were compounded by a lack of payments from the Kurdish Regional Government (KRG), these have resumed recently.

The company reported a net loss of $135m for the year ending 31 December, down from a loss of $248.2m a year earlier.