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.

http://www.investegate.co.uk/gulf-keystone-petrol--gkp-/rns/half-yearly-report/201309190700093684O/

Production now at 12400bopd,will certainly help the bank balence,no indication what they got for it though?

CEO
"As a result of having the Shaikan FDP approved, and in line with the Kurdistan Regional Government's stated production targets for the Shaikan discovery, we are delighted to have entered the first phase of commercial production, which was eagerly awaited by the Company's shareholders. It is an important milestone and another highlight of the four years of hard work since striking oil in August 2009. With the protracted Excalibur litigation behind us and the key uncertainty about the Company's future removed, we are working hard to deliver on all of our stated objectives and are very pleased to have appointed Deutsche Bank to advise the Company on achieving our goal to move to the Main Market by the end of 2013."

ion of 183,000 barrels as at 1 September 2013, at which point production had increased to 12,400 bopd.

Production from the Shaikan PF-1 was temporarily suspended on 4 September 2013 at the request of the competent authority for reasons not connected with the Company. The Company, following dialogue with the competent authority, believes that production is to resume shortly. Once the work on the flowlines to the Shaikan-4 well has been completed, the Company will reach the stated production target of 20,000 bopd. Shaikan-4 is the third producing well, which will be tied to the Shaikan PF-1 and the work on 8km of the connecting flowlines is expected to be completed in October 2013.

The presentation to analysts will be available on the Company's website at www.gulfkeystone.com from 10.00 a.m. (UK time) today 19 September 2013.

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Westhouse Securities comment today:
"“For GKP we are mainly concerned with cash G&A costs, interest payments and the net debt position.

“GKP reported:
Loss after tax of $26.4mm (vs WH estimate of $25mm)
G&A costs of $19.3 mm, of which cash costs amount to c. $14mm (vs WH estimate of $15mm)
Interest payment of $11.2mm (vs WH estimate of $8.9mm
Cash & cash equivalents of $141.2mm; net debt of c.$77 mm (vs WH estimate of $130mm cash and $113mm net debt)

Operations:
“PF1 and 2 update:
Production achieved from PF1 of 12,400 b/d by early September
Construction of PF-2, capable of producing 20,000 b/d, is ongoing; its mechanical completion expected in October 2013, followed by production operations by the end of 2013. Drilling on Shaikan-10 and Shaikan-7 is ongoing. Sale process of Akri Bijeel interest continues

“OUR VIEW: Results are in line with our estimates. The fact that PF1 is at 12,400 b/d is a slight positive but with PF2 completed in Oct/13 we think it is unlikely that the promised 40kb/d by year end will be reached in time. Drilling on Shaikan-10 and Shaikan-7 is still ongoing and no news on the sale of Akri-Bijeel. We maintain our view on GKP with a 170p/share target price and a Sell rating.”

Gulf Keystone Petroleum: Takeover debate dominates whilst Shaikan begins commercial production
By Jamie Ashcroft September 19 2013, 8:47am

[...]

Commercial production by early September was in the order of 12,400 barrels of oil per day, GKP revealed.Commercial production by early September was in the order of 12,400 barrels of oil per day, GKP revealed.

Gulf Keystone Petroleum’s (LON:GKP) court success last week has largely meant that today’s interim results statement is something of a side-show.

Wining the long running legal battle has, from the investor’s perspective at least, put the currently AIM quoted firm in the frame for a takeover - the legal claim for up to 30% of the group’s assets had previously been seen as a deterrent.

Since the win, last Tuesday, GKP shares have risen 13% to trade at 205p today – but, the heavily traded stock has changed hands as high as 245p since the ruling.

The speculation has been rife. Nevertheless, the group has also reaffirmed its plans to move up on the main market of the London Stock Exchange.

And with today’s results statement the company has confirmed it is now in commercial production.

‘Test’ production has been underway at GKP’s Shaikan field for some time and the group is now upgrading facilities so that rates can be increased.
In the six months, to June 30, GKP produced an aggregate of 183,000 barrels of oil, of which 179,063 barrels were sold into the domestic market.

Commercial production by early September was in the order of 12,400 barrels of oil per day, GKP revealed.

Further upgrades to the field’s infrastructure will see the installation of a second production facility, which will be capable of lifting output to around 40,000 barrels per day. The facility is expected to be complete in October.
Exploration, appraisal and development drilling continues across the portfolio as well.

In a stock market statement chief executive Todd Kozel said the start of commercial production was an important milestone and the company is now working hard to deliver on its stated objectives.

Elsewhere, Kozel attempted to talk down some of the speculation concerning possible M&A activity.

Speaking on CNBC this morning Kozel stressed the company’s focus was on its operations rather than looking for a takeover.

That said, Kozel did not deny there would be interest in the company or that the interest would be dismissed outright. “We’ll answer the phone, we’ll open the mail but it is not something we are focussing on,” he said.
He denied the company was talking with Sinopec or other majors about possible deals, but left the door open saying “if it [a takeover offer] comes along, it comes along.”
[...]


[...]

http://gkpinvestor.proboards.com/thread/2264/19-sep-2013-press-response

Bought back 1 DEC future at 206.16

Bought back 1 DEC future at 196.64

Kozel did not impress too many imponderables.

A stark contrast to his performance at the investors presentation.

http://video.cnbc.com/gallery/?video=3000200692&play=1

http://www.reuters.com/article/2013/09/19/gulfkeystone-idUSL5N0HF0SU20130919?rpc=401&feedType=RSS&feedName=rbssFinancialServicesAndRealEstateNews&rpc=401


Somehow i can't see no contact with majors,with AB sale in the offering?

http://www.investegate.co.uk/gulf-keystone-petrol--gkp-/rns/director-s-dealing/201309200700094829O/


Gulf Keystone announces that it received notification on 19 September 2013 that on 19 September 2013 Mr John Bell, a Non-Executive Director of the Company, purchased 72,200 common shares at a price of 201 pence per share.

The following is very much how i see it?

---------------------------------------------------------------------------------

Malcolm Graham Wood

----------

Gulf Keystone Petroleum

In what was meant to be a dull set of results, GKP managed to deliver everything as expected, however one or two things have left the market feeling that for the very short term at least, pressures are likely to be downwards.

A temporary shut-in of production was an initial worry although the company did go to some lengths to say that flow would resume ‘very shortly’. Another worry from some maybe shorter-sighted analysts is how the CPR is going to look when it is published alongside the documentation for the full listing. With the geology of Shaikan as it is there is a feeling from those more bearish that there will be more possible than probable or even proven in the report.

Finally the CFO was not going to be drawn on a 2014 capex budget, merely saying that expenditure would not exceed revenues and that although he might raise debt, equity is not an option.

Taking a look at the chart, the fall today is probably also reflecting the extent of the bull-run that the shares have been in since May and including the court case victory recently. I can’t see that this set of figures is going to shake out any devout followers and whilst traders may desert the ship short-term my feel is that they will return. With a target price of 480p our long term buy recommendation remains intact despite interim concerns and with production picking up and the full listing on the horizon the future is still very much intact.

Some info on SH-7 which i posed a question pre-results.


Shaikan-7, the first deep exploration well on the Shaikan block, spudded in June 2013 to evaluate the previously undrilled mid to lower Triassic and Permian horizons. The well is being drilled with the Weatherford Rig 319 (3,000HP) close to the crest of the Shaikan structure, approximately 1km east of the Shaikan-1 discovery well.

Following a number of side-tracks, casing is currently being set at the bottom of the Cretaceous at a depth of 1,250 metres. This vertical well is planned to reach a total depth below 4,500m in the Permian and is expected to take about nine months. Exploring this additional exploration potential may lead to discovering as much as between 1 and 5 billion barrels of additional oil in place resources.

http://www.telegraph.co.uk/finance/markets/questor/10321596/Questor-share-tip-Shares-in-Aim-listed-oil-explorer-Gulf-Keystone-look-oversold.html

http://legalfinancejournal.com/in-setback-to-new-york-funders-uk-court-tosses-claims-against-oilfield-developers/

http://www.investegate.co.uk/gulf-keystone-petrol--gkp-/rns/exercise-of-options/201309230700076054O/

Canaccord note today:
"Financials: With no production, the interesting points are the cash position of $141m (by mid-September this had shrunk to $101m), and G&A of $19.3m for H1 (more sensible than the $82m for FY'12).
Operations: Focus on the Shaikan development. First oil through PF-1 started in mid-July, and production averaged c.4,800 bopd until early September. At the moment, production has been (temporarily) halted due to non-GKP marketing related issues, but the company is confident that well and facility production capacity of 20,000 bopd will be available from October. All production so far has been sold into the domestic market at c.$43/bbl. From early 2014 production capacity should increase to 40,000 bopd once PF-2 is fully commissioned and we expect a mixture of trucked exports and domestic sales in 2014.
Financing outlook: Over the next two years or so, there is considerable, though not yet well defined, capex requirement (est. gross c.$700m, c.15 wells, 2 production facilities) to increase production to the 150,000 bopd target by mid-2016. The company is looking at a variety of funding sources but not currently at additional equity.
After the excitement of the successful court case, the spotlight returns to the operational progress and the company's financial muscle to achieve the planned Shaikan production growth. By GKP's own admission, additional financing will be required - beyond the current cash, potential previously-flagged asset sales, and anticipated operational cashflow - to fund the production facilities expansion and to deliver the next leg up in production. Debt or potential offtaker financing seem the most likely, and we expect the market to react positively to the conclusion of this process (which could still take some time as demonstration of satisfactory revenue generation may be required), and to the consequent allaying of any lingering market thoughts of equity issue.
We raise our target price to our NPV12.5 central value (excluding exploration and early appraisal projects) of 216p/share (previously 210p); we maintain a HOLD."