Takeover talk fuels share price boost for Gulf Keystone

City A.M. Reporter
SHARES in oil explorer Gulf Keystone Petroleum climbed 21 per cent yesterday after city analysts suggested that the Kurdistan-focused company is likely be the subject of a takeover approach.

The Aim-listed company’s shares have soared 26 per cent since the beginning of 2012, as an exploration well it is drilling in Kurdistan has thrown up positive results.

The Bermuda-based company last month denied that it was in takeover talks with Exxon Mobil, scotching market rumours.

Shares had soared as much as 36 per cent after suggestions that the US heavyweight oil firm was interested, before Gulf Keystone clarified that it was not in discussions about a sale.

“Gulf Keystone is a company that attracts a lot of speculative attention,” Peel Hunt analyst Werner Riding said yesterday.

“The potential in Kurdistan is vast and Gulf Keystone has first mover advantage over a number of production sharing contracts there, so they are very well placed. In time, I do expect to see Gulf Keystone receive a bid approach but clearly timing is the main uncertainty,” Werner said.

In an announcement yesterday the firm announced that it has reached an agreement with the Kurdistan Regional Government (KRG).

The group has agreed that the KRG has the right to take options take options in both the Shaikan and Akri-Bijeel blocks.

The firm’s shares yesterday hit the highest level since the company listed in 2004.