Gulf Keystone has begun exporting crude oil from the Shaikan field.
In line with the Company’s marketing strategy, which is being developed in co-operation with the Ministry of Natural Resources of the Kurdistan Regional Government, the first tendered cargo of between 30,000 tonnes (198,300 barrels) and 33,000 tonnes (215,000 barrels) of Shaikan crude was trucked to Turkey in December and will be loading at the port of Dortyol this month.
“Significant progress has been made since the Shaikan Field Development Plan was approved in June 2013. We began commercial production 30 days after its approval and now the first cargo of Shaikan crude is being sold to the international market,” said Todd Kozel, CEO of Gulf Keystone. “As we are increasing Shaikan production, we are developing a flexible marketing strategy in co-operation with the Ministry of Natural Resources of the Kurdistan Regional Government to achieve the best price for our crude. Our short-term focus is on the trucking export route via Turkey, while we are working on getting access to the regional pipeline network. Ours is a constant evolution: we are growing as a company and we are proud to operate in the Kurdistan Region of Iraq.”
A second tender is underway for two further cargoes of similar size of Shaikan crude, which are expected to be loaded later this month and during February. Sales realisations are expected to be in accordance with the terms of the Production Sharing Contract for the Shaikan Block (“Shaikan PSC”) and will reflect transportation and quality adjustments.
The first Shaikan production facility (“PF-1”) is in operation with two wells currently tied to the facility, namely Shaikan-1 and -3. The flowlines from Shaikan-4 to PF-1 are now complete and the well has been worked over as a Jurassic Sargelu producer prior to being tied to PF-1 in early 2014.
Work at the second Shaikan production facility (“PF-2”) is nearing completion with electrical and instrumentation work ongoing. The Shaikan-2, -5, and -10 wells have been completed as Jurassic Sargelu producers and the flowlines from these wells to PF-2 are currently being laid.
Current average oil sales from PF-1 stand at between 9,000 and 10,000 barrels per day of export quality crude. The Company will provide an update on well performance and combined production capacity of PF-1 and PF-2 as the additional four wells become operational.
