http://www.gulfkeystone.com/ The firms exploration programme in Algeria is going well and "the shares look good value", say the Investors Chronicle. Your comments please. goal.

yep - what rumours some people try to put out - the biggest danger is some maniac bombing the pipeline - no export suspension though
gl

Suggest in the coming 6 to 9 months markets are going to be strong (ignoring the short term rumour dominated volatility).

http://www.bloomberg.com/news/2011-09-08/insider-buying-highest-since-2008-in-europe-chart-of-the-day.html

Insider Buying Highest Since 2008 in Europe: Chart of the Day

By Adam Haigh and Tim Barwell - Sep 9, 2011 6:00 AM GMT+0700


More executives at European companies are buying their stock than at any time since the worst period of the financial crisis in 2008.

The CHART OF THE DAY shows that insider buying of shares climbed in August to its highest level since October 2008, according to data compiled by Citigroup Inc. That preceded a 84 percent jump in the benchmark Stoxx Europe 600 Index from March 2009 to the gauges peak this year on Feb. 17.

Directors have a good ability in timing the market, Chris Montagu, a London-based quantitative strategist at Citigroup, wrote in a report dated Sept. 6. One can conclude that, at this juncture, directors see current valuations as an attractive entry point.

The benchmark Stoxx Europe 600 Index slumped 16 percent from the end of July through Sept. 6 when the gauge reached its lowest level since July 2009. Equities tumbled amid concern that global economic growth is slowing as the European sovereign-debt crisis spreads. The indexs valuation slid to 9.1 times the estimated profits of its constituent companies during August, the lowest price-earnings ratio since March 2009, according to data compiled by Bloomberg.

http://www.thejakartaglobe.com/business/21b-deal-may-spark-oil-fight-in-iraqi-last-great-frontier/464739

Comment from EK.


"I bought yet more Gulf Keystone (GKP) at 163.5p on Friday. However one looks at it this Vallares deal with Genel sets the benchmark. I am told that were it replicated at Gulf Keystone the share price would be north of 4. As it happens I am also told that 8+ is much more like it. In today's market punters are hesitant to get stuck in. But they will."

What a great day,over 11.5m on the KSE and 170.5p fin,brealing the chartist
golden cross.

Indeed a great day for GKP.

Onwards to 200p soon.

Said that Shaikan-2 has now completed all testing and that news is now imminent.

with numbers out tomorrow and a weak market in prospect for remainder of today, it may be best to buy into the weakness - i.e. after the news - rather than now

Well, I brought in at 120p and glad I did. Things are moving the right way now, so make money.

i too already have a slab, but am tempted to buy more

Great rise today, we may see some selling tomorrow? Only weakness i can see here is the O/Gas law along with the service agreement issues and of course that lew suit.Once(if)they are cleared then who knows where we will end up?

dont forget todz has form.

Bit in The Times, snippet below : http://www.thetimes.co.uk/



".................The Kurdish region of Iraq where GKP operates is attracting a lot of attention, particularly since Vallares, the cash shell of BPs former chief executive Tony Hayward and Nat Rothschild, confirmed that it would buy an oil explorer there last week. The 2.5 billion deal, which effectively threw Mr Hayward and GKP together as working partners on the untapped Ber Bahr block, was music to the ears of the GKP faithful.

In part, GKPs improvement has been amid hopes that the Kurdish regional government would reach an accord soon with Baghdad on an oil law to regulate the industry. And, in part, there were hopes that GKP may soon name a new heavyweight director to bolster its credibility in more sober quarters of the market.

Then there were fresh whispers yesterday about its wells. Supposedly, testing of part of its Shaikan 2 well has showed it yielding as much as 60,000 barrels of oil a day. Meanwhile, its Sheikh Adi well, previously nothing but a disappointment to GKP enthusiasts, purportedly has had a second wind and the oil now flows more freely. An eagerly awaited report on GKPs wells was expected imminently............."


.

http://www.advfn.com/p.php?pid=nmona&article=49164445

Valuation and summing up by Zwngas,although a higher offer for cash than the $1.5bo,was my understanding?


First rate update and look at the pay in Sheik-Adi and Shaikan 4 compared to other wells. Firstly i see a current 6.70 valuation at the moment based solely on known resources !!

Shaikan-2 appraisal well drilling with test, core and log data indicating a net oil column of 126 metres and an aggregate flow rate of over 8,000 bopd
Shaikan-4 appraisal well spudded on 27 May 2011 and is currently drilling in the top of the Triassic. Only the Cretaceous and upper Jurassic have been logged thus far with 278 metres of net oil column
Well logs and core data thus far in the mid to upper Jurassic show a massive oil column with net pay intervals of 278 metres.

Sheikh Adi-1 exploration well drilling with core and log data indicating 256 metres of net oil column.
The gross pay interval in Sheikh Adi-1 is 2,790 metres, 35% more than Shaikan-1.

440,000 bopd pipeline suggest this also features the involvement of the Chinese -ie same capacity roughly as at TatAq (before Shaikan becomes a 300-500,000 bopd producer).

Bechme at near 4800 mts and target depth. Akri-Bijeel block to be sold which will remove upcoming costs for Barkman exploration. Bijeel appraisal well and surface production facilities at Bijeel. Likely that a sale is already lined up and possibly once Bechme known

More Oil in place to come from Sh-2 discovery and much higher pay in Sh-4.

BerBahr spuds middle of next month = 4 weeks.

Known P50 resources now 5.66 billion bls NET to GKP. Vallares paid $1.50/b for Genel resources - so this indicates a further way of valuing GKP (other than reserves which will soon come out imo). On a similar scale to the Genel deal based on net resources- GKPs bet resources value = $8.49 billion or 6.71 per share ! Further OIP upside to come from SH-2 and 4. BerBahr in it for free plus 2nd Sheik-aDI Structure.

All in all, very exciting times ahead imo.

This is where you can piece together the bits of rumours into something coherent.

Something like :

A beauty parade is being lined up with the reason being the sale of their stake in
the AB block.

Pending drill results at Bekhme-1 they expect to sell this stake off for 1.4 billion US$.

Nice :)

"LONDON, Sept 14 (Reuters) - Kurdistan-focused oil firm Gulf Keystone is confident political differences between Iraq and the semi-autonomous region of Kurdistan over an oil law will be resolved by the end of the year.

"It is on the front-burner of business in Baghdad with the Parliament, and local authorities told us they expect it to be resolved by the year end," Chief Executive Todd Kozel said in an interview with Reuters on Wednesday.

Iraq's central government and oil-rich Kurdistan have been at loggerheads for years over legislation that would go a long way towards deciding control of Iraq's reserves.

Oil company confidence in Kurdistan has grown since May when producers began to receive payments for exports after months of haggling between the central and regional governments, suggesting relations between the two had improved.

"I'm so confident it's coming (resolution on the oil law), I don't even contemplate the other," Kozel said.

"Iraq needs oil. Iraq needs revenues to rebuild the country and the only way for them to get it is through oil export and production. It's in the best interests of all Iraqis to resolve the oil and gas law." (Reporting by Sarah Young; Editing by Matt Scuffham)

http://af.reuters.com/article/commoditiesNews/idAFWLA506720110914

DJ INTERVIEW: Gulf Keystone Petroleum To Sell Akri-Bijeel License Stake



By Iain Packham
Of DOW JONES NEWSWIRES

LONDON (Dow Jones)--Iraq-focused oil explorer Gulf Keystone Petroleum Ltd. (GKP.LN) intends to auction off its stake in the Akri-Bijeel license in the Kurdistan region of Iraq to focus on its other projects in the region, Chief Executive Todd Kozel told Dow Jones Newswires Wednesday.

The company has a 20% stake in the Akri-Bijeel license, in partnership with Hungary's MOL Nyrt. (MOL.BU).

Kozel said the license currently contains one 2.6 billion barrel discovery and another drilling prospect with the possibility of an 8 billion barrel discovery.

The company is selling its stake not because it is relatively small but it is immaterial to the company compared with the exploration potential of its Ber Bahr license and the appraisal of its Shaikan discovery, said Kozel, referring to its two other assets.

Kozel said the company is just starting the process to auction the stake adding, "a process like this should generally take 90 to 120 days." He is confident of a quick sale due to the high level of interest in the Kurdistan region from large oil companies.

The company's primary asset, the Shaikan license, has indicated reserves of around 8 billion barrels of oil, he said. It plans to construct a 90 kilometer pipeline from the field to Kirkuk on the Iraq-Turkey border which could be capable of transporting as much as 440,000 barrels of oil a day.

He expects the pipeline to cost around $150 million to construct and take until 2013 to complete.

The field is producing around 15,000 barrels of oil a day, he said, adding the company plans to increase it to 50,000 to 100,000 barrels of oil a day, by which time it should have the new pipeline in place. Kozel said the firm has submitted the pipeline feasibility study to the oil ministry and is awaiting approval.

The Shaikan license is 75%-owned by Gulf Keystone, 20% is owned by MOL and U.S.-based Texas Keystone Inc. has 5%.

The Ber Bahr license is in its early stages and the first exploration well is expected to start drilling shortly. The company has a 40% stake in the project, Turkish oil company Genel Energy International also holds 40% and the Kurdistan regional government holds the remaining 20%.

Shares at 1105 GMT were down 11 pence, or 6.1%, at 170.5 pence in a slightly higher Alternative Investment Market--up 0.4%.

http://www.sharecast.com/cgi-bin/sharecast/story.cgi?story_id=4511344

Usual well researched and thought out post by Zengas.


After todays news, I've re-evaluated my investment in GKP again. What are the upper tier of Ftse250 and indeed 100 companies made of value wise?

The comment by DGA and reproduced on page 23 of the their presentation today is an important one - "No water contact encountered at Shaikan and Sheik-Adi - likely filled to spill"

The P1 figures for Shaikan are from 'April 2011' (but yet a further oil in place increase is due from higher pays and a further discovery) = 15 billion bls.

The P1 OIP figures for Sheik-Adi are from 'August 2011' = 4.8 billion bls.

If you use 33.3% Recovery factor (which is less than Tawke/TaqTaq) you'd get -

Shaikan = 15 b/bls x 33.3% = 5b x 51% net interest (not counting TKIs small stake) = 2.55 billion bl reserves potential before any further discovery upgrades.

Sheik-Adi = 4.8 b/bls x 33.3% = 1.6b x 80% net interest = 1.28 b/bls.

Total reserves potential on filled to spill (which they say is likely filled to spill) before ANY FURTHER additional oip upside, could equal 3.83 billion bls of net reserves to GKP. If the same $5.80/b is used that Vallares paid for Genel, then that equates to $22.2b of value or 17.30 per share on 800m shares/options. (We also know other cash bidders were prepared to pay more).

We have to take the "LIKELY FILLED TO SPILL" comment seriously.

The numbers quoted are still said to be conservative and theres still likely further upside from OIP at Shaikan and free upside from the 2nd Sheik-Adi exploration prospect (if similar to the 1st prospect - potentially a further 9.20 per share.

With BerBahr due to drill within 2-4 weeks and a net 40% interest the upside could be substantial if succesful. Using the current estimate of 1.9 billion bls OIP (If a discovery). Using the same 33.3% RF and 40% net interest would give GKP 250 mmbls reserves or 1.80 per share (a similar OIP find to Sheik-Adi filled to spill would equate to about 4.60/share but early days and it could be as large as Shaikan - we won't know til drilled).

If "likely filled to spill" is correct by DGA at Shaikan and Sheik-Adi we could be looking at 17.30/share. Add on any further oil upside from there and a find at BerBahr and theorectically a 20+ target is achievable - more so now than i ever thought realistically possible before.

There is as much multi bagger potential now as there was from 10p to 100p based on the initial prognosis at Shaikan over 2 years ago. If you recall 2 years ago it took ages for some analaysts to move from their 20p valuation on the initial discoveries at Shaikan in mid 2009. Imo the same situation is upon us now, but the upside potential for serious gains is as real now as anyone could ever grasp as those that had the forseight to do in 2009 ! Life changing gains may be made here with study, patience and foresight imo. Time to re-read the Zurich Axioms again.