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Genel’s Kurdistan oil production jumps after pipeline opens

WILL KENNEDY

LONDON (Bloomberg) -- Genel Energy Plc, the oil explorer headed by former BP Plc CEO Tony Hayward, said production jumped in June after Iraq’s Kurdistan region opened an export pipeline to Turkey.

Net production averaged 84,000 bpd in June compared with a 63,000 bpd rate for the whole of the first half, the company said in a statement.

The opening of the pipeline in May allowed the autonomous region to increase exports through Turkey, bypassing the central Iraqi network. While the government in Baghdad disputes Kurdistan’s right to sell oil directly, the regional administration has sold a cargo of oil at international prices and banked the proceeds in a Turkish bank, Genel said.

Kurdistan, which plans a referendum on independence from Iraq, has largely remained calm as Islamist militants fight the central government for control of large parts of the country. London-based Genel said its operations remain safe and secure.

Genel maintained a forecast for average output in 2014 of 60,000 to 70,000 bpd and said revenue would be $500 million to $600 million.

The pipeline will allow Kurdistan to raise exports to 200,000 to 250,000 bpd this month from 125,000 bbl early last month, Ashti Hawrami, the regional natural resources minister, said on June 18. Daily shipments may increase to 400,000 bbl by the end of the year, he said.

Iraq, excluding the Kurdish region, holds 150 billion bbl of proven crude reserves in the world’s fifth-biggest deposits. The Kurdistan regional government controls 45 billion bbl and has attracted international oil companies including Genel, Exxon Mobil Corp. and Total SA with financial terms many see as more generous than those in the rest of the country.

Genel fell 0.8% to 1,015 pence by 8:31 a.m. in London. The company said today, July 3, an exploration well off Malta was plugged and abandoned without discovering oil and gas.

07/03/2014

 

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