("Gulf Keystone", "GKP", "the Group" or "the Company")
2021 Full Year Results Announcement
Gulf Keystone, a leading independent operator and producer in the
"I am pleased to report a year of strong operational and financial delivery in 2021. With a 19% increase in gross average production to 43,440 bopd, our leverage to the recovery in oil prices and continued cost and capital discipline, we generated substantial revenue and free cash flow.
We continued to deliver on our strategy of balancing investment in sustainable growth and shareholder returns, as we resumed drilling activities and submitted a draft Field Development Plan to the
Looking ahead to the remainder of 2022, we remain focused on delivering gross annual production of 44,000-50,000 bopd by bringing SH-15 online in Q2 2022 and optimising production with well interventions and workovers. While constructive engagement continues with the MNR on the FDP, timing of approval remains uncertain and further progress is required before we fully execute FDP activity.
Following my first year as GKP's CEO, I would like to personally thank the Company's teams in
Highlights to
Operational
· Continued strong focus on safety in 2021 despite one previously reported lost time incident ("LTI"); currently no LTIs recorded for over 160 days
· Third consecutive year of production growth with 2021 gross average production of 43,440 bopd, towards the upper end of our tightened guidance range of 42,000-44,000 bopd and a 19% increase versus 2020
· 2022 YTD gross average production of c.45,500 bopd, following milestone achievement in
· Successfully restarted drilling activities in June, resulting in two new wells, SH-13 and SH-14, coming online towards the end of the year
· After acid stimulations, current SH-13 production in line with expectations while we continue to explore options to further increase SH-14 production
· Following the early appearance of trace quantities of water, SH-12 is currently shut-in while we investigate near-term production options ahead of installation of planned water handling facilities
· Spudded SH-15, which is currently being hooked up ahead of targeted start-up in Q2 2022
Draft Shaikan Field Development Plan ("FDP")
· Submitted draft FDP to
· While final timing of approval remains uncertain due to the complexity of the project, we are providing today an interim update on progress to date on Phase 1 of the draft FDP. As we continue to review opportunities to further optimise the project, final details and cost estimates may vary and we expect to provide an update upon FDP approval
· Expected components of Phase 1 of draft FDP:
o Expand Jurassic gross production plateau up to 85,000 bopd
o Test Triassic reservoir, targeting gross production plateau of up to 10,000 bopd
o Concurrently, execute Gas Management Plan to eliminate routine flaring through gas reinjection, underpinning target of more than halving scope 1 and 2 emissions per barrel by 2025
· From FDP approval, expected duration of Phase 1 Jurassic and Triassic projects is 36 to 42 months and the Gas Management Plan is 18 to 24 months
· Total Phase 1 gross Capex currently estimated to be
Financial
· Strong free cash flow generation of
· Total dividends of
· Revenue almost tripled to
· Adjusted EBITDA increased by almost four times to
o Gross average production increased 19% to 43,440 bopd (2020: 36,625 bopd)
o Realised price more than doubled to
o Gross Opex per barrel of
· Revenue receipts of
· Since the beginning of 2022, the Company has received a further
· Net Capex of
· Robust cash balance of
Outlook
· Remain focused on delivering 2022 gross average production of 44,000-50,000 bopd reflecting the anticipated production contribution from SH-15 and the benefits of well intervention and workover activities
· 2022 net capital expenditure guidance of
o Includes completion of SH-15 drilling, well interventions and workovers, and activity that enables us to expedite the FDP following approval
o With progress on the FDP, the Company expects to resume drilling and increase 2022 capital guidance
· Gross Opex guidance of
· Today declaring
o
o
o The Company will disclose the US dollar and pounds sterling rate per share for both dividends prior to their ex-dividend dates
· Assuming timely payment of invoices and continuing strong oil prices, we are expecting strong cash flow generation in 2022. This would provide flexibility to fund a potential increase in capital expenditure, with progress on the FDP, and the opportunity for further distributions to shareholders, while preserving adequate liquidity and maintaining a robust balance sheet
Investor & analyst presentation
Gulf Keystone's management team will be presenting the Company's 2021 Full Year Results at
https://webcasting.brrmedia.co.uk/broadcast/6221e42cfa16d9059b846ad1
This announcement contains inside information for the purposes of the
Enquiries:
Gulf Keystone: | +44 (0) 20 7514 1400 |
aclark@gulfkeystone.com | |
+ 44 (0) 20 8434 2754 | |
Mark AntelmeJimmy Lea | GKP@Celicourt.uk |
or visit: www.gulfkeystone.com
Please click on the associated PDF document to view the full announcement.
http://www.rns-pdf.londonstockexchange.com/rns/4740G_1-2022-3-29.pdf
This information is provided by RNS, the news service of the
https://news.cision.com/gulf-keystone-petroleum-limited/r/2021-full-year-results-announcement,c3535351
https://mb.cision.com/Main/19838/3535351/1556044.pdf
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