Gulf Keystone Petroleum Halts Drilling In Iraq Amid Covid-19 Spread

(Alliance News) - Gulf Keystone Petroleum Ltd on Monday said it has suspended drilling operations ...

Alliance News 16 March, 2020 | 10:52AM
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(Alliance News) - Gulf Keystone Petroleum Ltd on Monday said it has suspended drilling operations at the SH-13 well in Iraq as it bids to limit the spread of Covid-19.

The oil producer said drilling will be halted until "conditions improve to ensure safe operations".

Gulf Keystone said personnel movement restrictions have been put in place by the regional government of Kurdistan in Iraq.

"With these controls, along with the increasing global restrictions on movement, it has become difficult to ensure Gulf Keystone has the appropriate drilling personnel and equipment on site in order to continue safe drilling operations. Therefore, with the SH-13 well - the current well in the campaign - at a safe stage, the decision has been taken to suspend drilling activities," the company explained.

The production rate from the Shaikan field is roughly 38,000 barrels of oil per day with output currently unaffected by Covid-19.

Gulf Keystone said: "However, as a precaution, the company has restricted the access to its production facilities. As a result, certain construction activities related to the expansion to 55,000 barrels of oil per day have also been suspended until circumstances improve.

"The current situation is extraordinary, and we believe that our actions protect the long-term value of the asset. The planned production increase to 55,000 barrels of oil per day, scheduled for the third quarter of 2020, and average production guidance for 43,000 to 48,000 barrels of oil per day remain priorities. However, the suspension of drilling and certain expansion operations may impact Gulf Keystone's ability to meet these targets in the timeframes currently in place."

Shares in the company were 9.6% lower at 76.10 pence each in London on Monday morning.

By Eric Cunha; ericcunha@alliancenews.com

Copyright 2020 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Gulf Keystone Petroleum Ltd 64.00 GBX -8.31 -

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