Gulf Keystone set to move to main market

Suzie Neuwirth
OIL AND gas explorer Gulf Keystone Petroleum is set to begin trading on the main market of the London Stock Exchange tomorrow, after a tumultuous last few days on Aim due to fears of a capital shortfall.

The Kurdistan-focused company warned on Thursday that it “does not have sufficient working capital” to fulfil its plans for the next year, if none of four possible cash-enhancing events occur, one of which is meeting its production target of 40,000 barrels of oil per day from the Shaikan field.

GKP is not raising any funds or issuing new shares in connection with its main market admission.

The company said it faced a possible shortfall of around $20m (£12m) by the end of May, which would increase by between $10m and $15m per month until 2015.

GKP said on Wednesday that it is looking to tap the bond market for the first time to raise $250m.

“The risk here is GKP not raising enough debt and hence, having to slow down the pace of operations,” said Jamal Orazbayeva, analyst at Westhouse.

Shares tumbled 15 per cent on Thursday but rallied on Friday, before closing 1.7 per cent lower.