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.

investors presentation.

http://www.investor-day-gulfkeystone.com/reg_site/public/public_webcast.aspx

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Although long,interesting as to what goes on benind the scenes,looks like the BOD have had their backsides slapped?.

--------------------------------------------------------------------------------13 - 08:33 0 1

This post attempts to redress some inaccuracies being purported around, and unfortunately one cannot be inspirational around such an ugly topic.

Many people have jumped to conclusions without knowing the full extent of previous/ongoing discussions with the institutions. As large investors, they are careful over disclosures regarding past conversations, precisely to avoid the chaos now enveloping around. Professional conduct has been misinterpreted and belittled.

The institutions have been battling hard against gluttonous pay and demanding better corporate governance for awhile now. Truscott’s removal was exemplary of actions taken partly behind the scenes and partly in collaboration with private investors.

Recently. Gulf claim that they received no guidance from M&G on their nominations, and that the CEO/chairman split was their own idea. The city was fuming after Todd Kozel’s 10 million share transfer, there were heated arguments behind closed doors. Unfortunately one major institution got conclusively fed up, they just sold and moved on.

As such. Gulf are not properly acknowledging the pressure exerted, but instead hope to take credit as proof of self-reinvention.

Institutional nominations are not unheard of, they are acceptable in the city and are undertaken for various reasons. Laughably that does not include “Trojan horse” hostile takeover. In this case, it is for reinvigorating transparency and due diligence in a manner acceptable to shareholders. With 4 nominations, these proposed directors factually cannot control the company. Individuals who claims otherwise are going beyond fact or remit.

Much has been touted about the background of directors required for a premium FTSE listing. Such background is actually not in the listing requirements, but in any case the proposed nominations meet inferable requirements comfortably for a premium listing and as an exciting E&P. Besides, if one thing Gulf management does demonstrate, some personnel (not all), already have required technical/operational expertise. The governing body will cast its eye on other aspects, and it remains immaterial what GKP claims to be requisite of additional personnel. It is also immaterial what Gulf claims are its intentions about transforming into a shareholder-aligned company. The governing body will ultimately decide this by investigating Gulf’s actual actions to justify confidence that the listing would not harm a wider audience of shareholders.

The candidates themselves have considerable oil industry / military experience, with particular relevance to the kind of fiduciary changes being demanded. The institutions no longer trust this company, and that distrust extends to the current board’s ability to appropriate its own candidates. Expectantly, M&G’s 4 nominations should get their hands dirty around corporate governance, they shall certainly acquaint themselves with technical operations but would not interfere with day-to-day progress. The big investors are still very much proponents of the asset and its potential fruition, but focussing on the asset doesn't mean neglecting company behaviour.

Gulf may continue to generate excuses over "required technical expertise”, this inadvertently digresses from the immediate priority of board changes to align shareholder interests. Company NEDs objectively provide consultation on better corporate governance, better corporate culture, and against gluttonous behaviour. Since the current board have approved huge remuneration packages, resultantly failing in duty to shareholders, it is simply imprudent to accept their own advice or recommendation.

Gulf clearly repulse the level of scrutiny the institutions require, serving only to harden the city’s resolve. To put it curtly, the institutions take little assurance from this reaction.

One of the nominations and former director, Jeremy Asher, has considerable personal wealth invested. The point raised here about “independence” is yet again misrepresentative. Moot one might add.

Mr Asher cannot force the company to pay excessive share dividends, which is a potential conflict of interest. That is hugely unlikely given the company is loss-making and requires additional financial capex. The proposed NEDs understand the nature of this business, and hence basic conversations over whether the company should further invest vs capital allocation will not emerge. Mr Asher’s interest as a shareholder is perfectly aligned to that of all shareholders. Mr Asher’s previous fall-out with the rest of the board are for reasons perfectly aligned to that of all shareholders. The board must answer for all measures of surprise and opaqueness in future, there must not be a repeat of Gokana, Etamic, huge loans, sudden exit awards, or excessive executive pay. The board should be structurally incentivised by execution and delivery, and a review is needed to replace the current non-formulaic wayward indifference given to investors. Excesses must be curtailed, but incentives to remain. Fairness.

A visible hardcore group predict Armageddon should the institutional candidates join the board. Yet the proposals are not here to destroy value, but instead give better scrutiny over expenses, remuneration, accounts, bonuses, share dealings, etc. Whether it be Mr Asher, or anyone else board-backed or institution-backed, friction and challenge are guaranteed regardless should the executives act as they have done, and the incoming directors are properly discharging their responsibilities. Needless to say it is hoped matters will be tackled in a constructive and progressive manner. None of this is designed to harm the investment, but protect it. But neither can investors afford to neglect it. In the city, we call it Corporate Governance.

In all this, the institutions are trying to avoid a public humiliation for Mr Kozel, and I sense this is the final window for the CEO to avoid turning into an embarrassment for the company. I hope Mr Kozel carefully considers his next announcement.

Should Mr Kozel remain hostile to M&G’s nominations, and lose, the market will be unforgiving with a crushing verdict: In light of his high salary, they will permanently embed a reputation drastically different from just “colourful”, and one from which I fear he shall never recover. Coming to the crunch, such a level of tarnish to the company may damage the investment. But the institutions cannot afford to let the company slip any further, Mr Kozel will merely feel the severity of his own disposition. That would be most uncomfortable if he continues to oppose the nominations, and they are eventually voted in. A real possibility that is looming and imminent. The remaining institutions will see this through to the end. For them, such a course of action and thought-process manifests a simplicity acquired through years of investment experience.

I continue to draw people to empirical observation and away from misguided speculation.

Considering size/profile of business, pace of progress, and financial pressure, the executive pay at Gulf does not reflect fair compensation. Mr Kozel has already benefited several times over what is normally acceptable. The board are not entirely beyond redemption - the institutions called for change and they give credit when due. Gulf introduced Simon Murray as chairman and people are indicatively encouraged. But there is still a litmus test for Mr Murray, we do not know how he stands as the new head of remuneration, and this step does not go far enough.

No one man is a mountain. Mr Murray was involved in what some claim as a poor example of corporate governance in Sino-Forest, a timber company that overstated its timber. There are allusions that Mr Murray’s low attendance at meetings contributed to their directors’ oversight. It is only sensible that the institutions demand all measures possible to reinforce the board as can be best possibly served.

If there is one point you should take from this, I leave you with this…

In order to turn this company from a world-class asset into a world-class investment, the company’s track record on corporate governance and remuneration must immediately repair, with urgency. Either the board will expose itself painfully at the AGM, or as hoped quickly re-evaluate the gravity and conviction of sincere well-meaning investors, both institutional and private alike.

To achieve its claim, Gulf must surrender what they are fighting against, for the institutions move solely and only to underwrite genuine transparency & true corporate governance.

Gulf have not yet release the CVs of M&G's 4 candidates, which is most undignified given the lateness of the hour for voting. The city’s opinion is that refuting even one of M&G’s nominations, even with Mr Murray’s voice, is simply not good enough.

Gulf should have foresight in considering its message/image to all current and future investors, the kind of investment it targets, the kind of league it aspires towards, and the listing body it will eventually approach. Unfortunately, current measures the board thinks sufficient for corporate governance may upend everyone's dreams. I predict will be no leap of faith in just Gulf-nominated directors. I predict there will be no compromise on the proposals announced.

The board must address the current before promising the future; if you cannot trust a man with a fiver, what does it matter if the fiver turns becomes £50 or £500. Your incumbent will take a bigger and bigger slice of your share, reducing your reward without reducing the risk to your investment. If Gulf Keystone could indisputably demonstrate world-class culture alongside world-class assets, that would be a huge re-rating for the stock and renewed confidence in the company.

Through the institutions and moulding Gulf's management board, achieving world-class is within grasp. Achieve it.


citywired

an interesting read even if it is not at all clear who wrote it or what his position is in relation either to the company or as a shareholder or aything else ..... meanwhile, the market looks somewhat receptive and cheered to whatever actually transpired

Well it lokks like sentiment is changing,i think the presentation along with GC issue being addressed has a lot to do with it.

I think this is the source of the article?

http://citywire.co.uk/

http://www.thisismoney.co.uk/money/markets/article-2362088/Reckitt-Benckiser-shareholders-1-8bn-wiped-value.html#ixzz2YsBPplX5

From the above link.


Afren, its top pick, rose 2.9p to 137.5p. Gulf Keystone, which Goldmans believes to be a particularly attractive takeover target, gained 10.75p to 176.25p. Its 12-month target price for GK is 265p.

Simon Murray

Letter from Simon Murray, C.B.E. and Legion d’honneur, Independent Non Executive Chairman
I am pleased to take this opportunity to address you, the owners of this Company, having been recently
appointed as Independent Non Executive Chairman of your Company.
GKP is a company that I decided to join, after being approached by Odgers Berndtson and then
conducting my own due diligence. I was quickly impressed with the quality of your Company’s assets
and operations and by the Board and management team and especially their combined unity and
passion to make GKP even more of a success than it is already.
I have over forty years experience of international business and I know that it is passion and drive to
succeed that marks out the true entrepreneurs and value creators – those that can see the future and
have the expertise, drive and determination to make it a reality, which I strongly believe is what, your
CEO, and the team have achieved in Kurdistan over the past six years.
GKP has already achieved so much operational success in a short period of time and clearly has the
ambition and ability to do much more, which is one of the primary reasons I have joined the Board as
Independent Non Executive Chairman.
This success is underpinned by the exceptionally strong relationships between senior members of the Gulf
Keystone team and key stakeholders in the Kurdistan Region of Iraq which have been built up over many
years and is founded upon mutual respect, understanding and six years of close co-operation.
The Minister of Natural Resources of the KRG has kindly invited me shortly to meet with him and it is
evident to me how key the close relationships in Kurdistan were and are to the Company’s success and
it is also clear to me that these relationships have meant that the Company has been able to achieve
the drilling and discovery success of the past four years. I also firmly believe that relationships such as
these are key to us achieving future success and I, and the Board, will seek to strengthen these
relationships further to develop Shareholder value.
Quite simply, without these close relationships in Kurdistan, it would, in my view, not have been possible to
have drilled 18 wells, made five discoveries in four years and to have created the biggest onshore oil
development opportunity today not held by an international oil major.
Equally simply, without maintaining and nurturing these deep seated relationships, I believe there is a real
risk that our progress will stall and our ambitious targets will not be met. This is a risk that your Board does
not wish to take and it is a risk that we do not believe that Shareholders will wish to take either.
In my role as Independent Non Executive Chairman, I intend to ensure that your Company meets the
highest standards of corporate governance. I will bring strong leadership to the Board and it is my job to
ensure the Board functions properly and that the structure and experience of the Board are appropriate
for a company seeking a move to the Main Market.
I also intend to work with the Nominations Committee, led by Lord Guthrie, to identify suitable
candidates to ensure the overall effectiveness of your Board and its various committees. It is with that in
mind that I have reviewed both the shortlist of candidates identified by Odgers Berndtson and the M&G
Candidates.
As you are aware, I will be taking the chair of the Company’s Remuneration Committee from its next
meeting, and one of my first actions will be to appoint third party remuneration consultants to review
every aspect of the remuneration and incentivisation of the Board and senior management team to
ensure that your Company’s remuneration is appropriate.
I am committed to improving the ongoing dialogue between the Company and both its institutional and
private Shareholders. Over the next few weeks, I will be endeavouring to meet as many of the
Company’s institutional Shareholders as possible and I also look forward to meeting as many of you as
can attend the AGM and future Investor Days.
Finally, it is inevitable that as GKP endeavours to meet its ambitious targets, there will be bumps along
the way and issues that Shareholders will want addressed – I am here to tell you that, as a genuinely
independent voice on the Board, committed to the highest standards of corporate governance, I will
always be available to address such matters, insofar as public market rules permit, and to that end, you
may contact me via the investor relations team at ned@gulfkeystone.co.uk.
Turning to the M&G Candidates, I concur with the analysis set out in this Circular and the
conclusion reached by Lord Guthrie and endorsed, unanimously, by the Board.
10
The appointment of these M&G Candidates would, in my opinion, be a backward step at a time of
critical development for the Company, which I feel will disrupt the unity of the management team, as
well as damage the vital relationships Mr Kozel and the team have established and maintained in the
Kurdistan Region.
This is not a personal criticism of the individuals, but in our judgement, based on their business
experience and expertise, is that they do not meet our requirements, as set out by Lord Guthrie earlier
in this Circular.
Accordingly, for the reasons set out in this Circular, it is my strong personal view, as Chairman
of the Company, that Shareholders should vote AGAINST the appointment of the M&G
Candidates to the GKP Board.
Simon Murray
Independent Non Executive Chairman

almost no mention of TK and his buddies having their noses deep in the trough, and THAT is why the need for additional NEDs, and of course TK will not like it one lttle bit

the appointment of extra NEDs would in no way impede the clearly strong relationship that TK and the GKP board have built up with the local hiearchy (banditry) ...... however, i do accept that additional institutions NEDs may well be obliged to stop the payment of the very necessary local "commissions" which are indeed fundamental to doing business in the region (and elsewhere in the world too!)

hmm! on reflection, not quite as simple a choice as would appear on the surface

almost no mention of TK and his buddies having their noses deep in the trough, and THAT is why the need for additional NEDs, and of course TK will not like it one lttle bit

the appointment of extra NEDs would in no way impede the clearly strong relationship that TK and the GKP board have built up with the local hiearchy (banditry) ...... however, i do accept that additional institutions NEDs may well be obliged to stop the payment of the very necessary local "commissions" which are indeed fundamental to doing business in the region (and elsewhere in the world too!)

hmm! on reflection, not quite as simple a choice as would appear on the surface

http://www.mandg.co.uk/-/media/Press%20Releases/RecoveryGKPfurtherstatementpdf.pdf

http://www.thesundaytimes.co.uk/sto/business/Industry/article1287366.ece



THE battle for control of Gulf Keystone boiled over this weekend when the board of the £1.6bn oil explorer rejected a slate of new directors proposed by rebel shareholders.

The board, led by recently appointed chairman Simon Murray, the former foreign legionnaire, slammed the candidates. They recommended a “no” vote for all four, claiming they lacked “the track record of successful operational and commercial experience”.

The rebuff is a serious escalation of the fight between the company and the rebels. M&G, the fund giant that has led the rebellion alongside Capital Group, another big investor, yesterday reaffirmed its intention to push ahead with a shake-up.

It said: “M&G is not seeking representation on the board of Gulf Keystone, nor has any wish to interfere with its operations.

http://www.thesundaytimes.co.uk/sto/business/Industry/article1286948.ece

http://www.thesundaytimes.co.uk/sto/business/Companies/article1286970.ece

The Financial Times names Andrew Simon as one of the GKP NED candidates
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Mr. Andrew H. Simon, MBA, BSc, OBE served as the Chief Executive Officer and Managing Director of Evode Group PLC of Staffordshire from 1980 to 1983. Mr. Simon spent 23 years of his early career with Evode Group. He serves as the Non Executive Chairman of Germany's Kaffee Partner, Zeus Group Ltd. and Ascent Investments Ltd. He served as the Chairman at Azelis Italia SPA and Azelis S.A. He served as the Chairman of Evode Group at Staffordshire from 1980 to 1983. He served as the Chairman of Supervisory Board at Ascent Investments Ltd. He served as the Chairman of Meretec Corporation. He served as the Executive Deputy Chairman of Dalkia PLC. Mr. Simon has been a Non Executive Director of Travis Perkins PLC since February 20, 2006 and Management Consulting Group PLC since March 3, 2006. He serves as a Non Executive Director of Exova Group Limited. Mr. Simon has been a Director of Finning (Canada) Inc. since 1999. He serves as Advisor and Member of the Supervisory Board of several companies. He serves as a Member of the Supervisory Board/Director at Kaffee Partner Holding GmbH, Associated British Ports PLC, Brake Bros Ltd. (a/k/a Brake Brothers Ltd), and Dalkia UK PLC. He is also a Board Member of general partners within the iCON group of funds. He serves as a Non Executive Director of Dalkia PLC. Mr. Simon has been an Independent Director of Finning International Inc. since 1999. Mr. Simon has been a Member of the Supervisory Board of SGL Carbon SE (also called as SGL Carbon AG) since 1998. He serves as a Director of Ascent Investments Ltd., and Zeus Group Ltd. He served as a Director of Meretec Corporation. Mr. Simon served as a Director of Azelis Italia SpA and Azelis S.A. He served as a Non Executive Director of Associated British Ports Holdings PLC from November 1994 to April 26, 2006. Mr. Simon served as a Non Executive Director of Severn Trent PLC until July 26, 2002 and Hampson Industries PLC until June 30, 2003. He served as a Director of Ibstock PLC, Property Internet PLC and Laporte PLC. Mr. Simon studied Economics and Accountancy in Southampton. Mr. Simon holds an MBA from the Wharton Business School at the University of Pennsylvania and a Bachelor of Science from Southamption University.

http://www.investegate.co.uk/gulf-keystone-petrol--gkp-/rns/board-s-recommendation-to-shareholders/201307150700082897J/

C&P
-------------------------------------------

Full Times article:

Private investors look likely to settle the fate of the board at Gulf Keystone Petroleum after directors of the Iraqi Kurdistan oil explorer and a party of rebel investors failed to settle their differences over the weekend.
Todd Kozel, the chief executive, and Simon Murray, the former Glencore chairman who was installed as chairman of Gulf this month, are attempting to block a bid by M&G Recovery Fund and Capital Group, the US fund manager, to place four of their own appointees on the board.
The dispute is over corporate governance and claims by the rebels that directors’ pay has been excessive. The rebels speak for a little more than 10 per cent of the company, which is in the process of moving from AIM to a full listing.
But just over half of the shares are in the hands of private investors. The vote on whether the rebels’ candidates or the existing non-executives are appointed will go to the annual meeting in Bermuda on July 25.
Mr Kozel is extermely popular with those investors because he has taken Gulf Kurdistan from a penny stock to its current size on the back of a huge discovery in Kurdistan while navigating the complex political situation and the local bureaucracy.
By the end of this year the Shaikan field there will be producing at a level of 40,000 barrels of oil a day (bopd), with 150,000 bopd targeted within three years.
Both sides put out statements over the weekend after a meeting on Friday between the rebels and Mr Murray failed to reach agreement. M&G said it “is not seeking representation on the board of GKP, nor has any wish to interfere with the operations. But we do want the election of truly independent non-executive directors who will represent the interest of all shareholders.”
For its part Gulf Keystone singled out one of the four nominees for particular opprobrium. Jeremy Asher was the company’s deputy chairman until he fell out Mr Kozel over boardroom pay and was ejected in 2010.
The company’s statement accuses him of going behind the board’s back in contacting the authorities in Kurdistan over the proposed board changes, and claims that those authorities refused to meet him.
Commenting on Mr Asher’s contacts with the Kurdistan authorities, one source close to the situation said: “The institutional investors felt it was appropriate to give the KRG (The Kurdistan regional government) a ‘heads up’ and the KRG, quite properly, replied that shareholder and board matters were not their concern.
“We are concerned that Gulf Keystone’s statement could be read as implying that the KRG might seek to influence shareholders’ decisions on the board composition when the KRG have clearly and properly said the opposite.”
Gulf Keystone claims that Mr Asher, who along with two of the other three proposed non-executives is an oil industry veteran, is not independent because he owns 1.71 per cent of the shares. “The board believes that it would be inappropriate to reappoint to the board an individual who has previously been a disruptive presence on the board and who was removed on 31 March 2010.”
A company source at Gulf Keystone suggested the matter could be resolved by further negotiation before the annual meeting. “We’ve started the process of bringing in good people. The appointment of Murray signals that,” he said. “Maybe people will see sense and get in a room again.”

From W H Ireland this morning....

Market Cap £1.7bn Price 177p Target 315p
- Gulf Keystone has reiterated its opposition to the appointment of any of the non-executive director candidates suggested by M&G’s Recovery Fund which is seeking to exert its influence over the Board’s strategy. One of the candidates, Jeremy Asher (a former director of GKP), is not deemed suitable given his existing significant shareholding in the company (1.71%) by GKP.
- We believe the election of non-executives and the resolution of the litigation case with Excalibur which is anticipated towards the end of August could add at least 20p-30p/share to the current share price. Importantly, the company recently confirmed that it was on track for full development at Shaikan and we see this factor, along with the company achieving a main listing on the FTSE 250, as key drivers to re-rate this stock. BUY maintained.

since when has it not been in order for a NED to own shares?

surely the shareholders should be allowed to decide which directors they want on their board?

as far as i can see, that is why it is going to AGM vote