Gkp- Gulf Keystone Petroleum

[Undertaker]

Analyst field trip report

http://www.fox-davies.com/media/1874...paug262010.pdf

We are not changing our broad assumptions on Gulf Keystone as a result of this trip; however our confidence in our
current forecasts and estimates has been increased. The upside potential is clearly huge and on par with the size of the
Kirkuk field, i.e. 20Bbbl recoverable, and relies on the three structures of Shaikan, Sheikh Adi and Ber Bahr to be filled to
regional spill point as currently interpreted from pressure gradient data, with Akri Bijeel providing additional upside.

While this is far fetched, it is possible and would represent an 8 times upside from current share price level.

[evilsatan]

I didn't post this earlier as I was waiting until the results of the test drill were out but these shares have been flying since this news broke, should have made some of you a very nice return! I bought in at 105p and have a 30% return. Currently sitting at the 140p mark.

Gulf Keystone excited by 'imminent' test production

LONDON (ShareCast) - Kurdistan-focused oil explorer Gulf Keystone trimmed interim losses thanks to a foreign exchange gain and expects the first test production from Shaikan-1 “in the coming weeks”.

Losses after tax for the six months ended 30 June dropped to $3.1m from $5.6m a year earlier, and cash ballooned to $161.7m from $16.7m following May’s $165m (£114m) fundraising at 75p a share.

"2010 has seen an unprecedented level of activity for Gulf Keystone. Our extensive drilling programme is aimed at proving up last year's immense discovery, and we look forward to the first test production from Shaikan-1 in the coming weeks,” said executive chairman and CEO Todd Kozel.

Gulf says it will take a few months to reach a steady oil rate from the testing of Shaikan-1, but the first deliveries of test production for sale are “imminent and greatly anticipated” and will further boost the company's finances.

The half year report is also out with some good figures on last year:
http://www.digitallook.com/news/rns/...ly_Report_html

[Undertaker]

Was waiting for you to post

anyway here is some more articles

Foreign players eye KRG riches
http://www.upstreamonline.com/hardco...icle229159.ece

Outlook is fine for Gulf Keystone
http://www.upstreamonline.com/hardco...icle228999.ece

Playing political waiting game in KRG
http://www.upstreamonline.com/hardco...icle229158.ece

I managed to speak to the reporter on Monday, he mentioned that he has visited GKP in kurdistan.

It looks like they are getting their PR guns out, expect this to rocket!!

[evilsatan]

I wasn't sure if to top up on them or not, the possibilities are endless but topping up would involve taking money out of my ISA which I would like to avoid. Test production could be the news to send these sky high very quickly though! Arghh I hate these decisions

[me2000uk]

Hi All, forgot about this post sorry, i still believe this has enormous potential, and i really hope that u guys have bought some of these shares if you hadnt already!
I am personally holding for the long term (take over). I believe this share is a once in a life time opportunity. DYOR

Good luck All
Ps once the contracts are sorted this share will treble in my opinion! they have the oil thats not in question! its just getting it out of the ground however there is loads of news due over the coming weeks so expect this to carry on flying

Mark

[Undertaker]

SEY hit a duster, hope you guys are not in there

Just goes to show that nothing is dead cert..

[evilsatan]

Lloyds released good news today, just when I was considering selling them off to top up in GKP. New news for GKP:

GULF KEYSTONE (GKP.L)
The Iraq-focused oil explorer is looking at moving up to London's main share
market in the first quarter of 2011, The Sunday Telegraph reported without
citing sources. [ID:nLDE68I06U]

[evilsatan]

Bit of a sell off today causing the price to dip, may be on the back of a new operational update. Sounds promising to me though, the next 'several weeks' should be rather interesting...

Gulf Keystone Petroleum Ltd. (AIM: GKP)
("Gulf Keystone" or "the Company")

Kurdistan Operational Update

Gulf Keystone Petroleum Ltd., an independent oil and gas exploration company, today provides an update on its operations in the Kurdistan Region of Iraq ("Kurdistan").

Shaikan Long Term Test Facilities

The recently constructed production test facilities near the location of the Shaikan-1 discovery well in the Shaikan Block (75% GKP working interest) are being commissioned. Initial flow rates are low to allow facility commissioning and will be kept low, pending receipt of oil assay results which will assist in determining a domestic sales price and allow finalisation of the oil sales contracts. Facility commissioning, assay finalisation and sales contract negotiation are expected to take several weeks. Test operations are well on track to reach the previously announced year end target production rate of 8,000 to 10,000 barrels of oil per day ("bopd").

John Gerstenlauer, Chief Operating Officer for Gulf Keystone said: "This marks the end of a seven month accelerated design and construction project to install the 18,000 bopd capacity facility and the beginning of a long term (18 to 24 month) production test of the top most reservoir in the Jurassic age section of the Shaikan well. This extended test of the upper portion of the Jurassic will give us valuable information on production characteristics, market logistics and oil sales procedures within Kurdistan. In addition, use of these prefabricated production facilities will serve as a model for future testing and production of other potential oil accumulations on our acreage."

Bijeel-1

Testing and evaluation are continuing on the MOL operated Bijeel-1 well in the Akri-Bijeel Block (20% GKP working interest). The previous announcement of a 3,200 bopd test already makes this one of the more significant discoveries in Kurdistan. Additional testing and evaluation work are still ongoing. However, the initial indication of the oil-water contact in this well is supportive of the concept of a single regional aquifer; this further supports the upside oil volume scenario for all four blocks in which GKP has an interest. In addition, it appears that the Bijeel structure could be a southern extension of the much larger Bekhme structure. The Bekhme exploration well is planned for late 2010 or early 2011.

Sheikh Adi-1

On Sheikh Adi-1, following the sticking of the bottom hole assembly at a depth of 450 metres and the necessary sidetrack to drill around the obstruction, the well is now at 500 metres which is the 20" casing point.

Shaikan-3

On the shallow Shaikan-3 appraisal well, near the site of Shaikan-1, the well is drilling ahead at 837 metres with the next casing point expected at 900 metres and the first zones of interest expected to be encountered soon after that.

http://www.digitallook.com/news/rns/...al_Update_html

[Undertaker]

expect to finish around 150 today

plenty of news round the corner though so nothing to worry about. Don't even bother day trading this one as news can come any time

[evilsatan]

Nice rise so far today (7%), lot of talk over at iii.co.uk but you never know what's bullshit.

http://www.krg.org/articles/detail.a...=223&anr=37132

[Undertaker]

Relaxing in turkey, thought I'd log in and see what's happening. Let's hope the Kurdish demands are met, especially the oil contracts.

Cya all soon

[evilsatan]

I think this is relevant to us

A well- informed sources said that Prime Minister Maliki approved 18 of 19 items in the work paper presented by the Coalition of the Kurdistani Blocs.

The source emphasized that Maliki surprised, even the members of his Party (al-Daawa) by accepting to recognize the oil investment in Kurdistan Region and giving it the exploration and exporting right.

The Source clarified that the PM accepted to give a constant share of the federal budget to Kurdistan Region and gave the Kurds the guarantees to the Implementation of Article 140 of the constitution to resolve the issue of Kirkuk and other disputed areas in Ninawa, Seladen and Diyala provinces.

The Source pointed out to the only point of difference which is the Kurds demand to consider the government resigned if their ministers withdrew from it, this is the only point Maliki protested and asked the Kurdish Negotiation Delegation Headed by the Leader in Kurdistan Democratic Party Rozh Nouri Shawis to delete or amend it.

http://www.pukmedia.com/english/inde...raq&Itemid=386

[evilsatan]

There is a lot of articles claiming progress with the political situation, lot of talk of these shares making a rise this week. But talk is cheap so lets see. I am looking to make one final top up before these (hopefully) start to rocket.

[Undertaker]

Hold on to your golden tickets


Rumoured

Update: 18.12 (BST)
I have learned (™ Robert Peston) that Gulf Keystone have completed their cash call – raising $175m at 140p a share. The placing was more than twice oversubscribed and it should be announced on Monday morning barring any last minute technical glitches. The cash will be used to accelerate Gulf Keystone’s drilling activities in Kurdistan, I understand.

Twice oversubscribed and why such an urgent need for more cash? Placing was at 140p so not much of a discount on the current SP, the question then is why was it over subscribed?

Is this to speed up appraisal work before the predators make a t/o bid or have GKP managed to get another block. Or is it in preparation to move to the main exchange?

Monday should be very interesting.

[evilsatan]

Soooo much speculation and many rumours flying about, but among the usual bollocks from rampers/derampers there are some well thought out points. Taken from iii:

Can you say "an additonal block?"
----------------------------------------

Yes indeed Pitts, I do believe I can!

As you say, a wee bit more than expected. And a wee bit earlier than I was expecting - why so much, and why NOW? I guess we are soon going to be told a "good story" about "a stunning development" (Daniel Stewart):
http://www.ft.com/cms/s/0/d62b061c-d...dc0,s01=1.html

So what good story do GKP have to tell - about "a stunning development" that "goes well beyond what we were originally talking about", and has prompted an over-subscribed placing at essentially zero discount to sp?

Well, for starters, I don't believe in coincidence. On the same day that GKP raised $175m, another Kurd oily, Genel, did exactly the same:
http://www.businessweek.com/news/201...5-million.html
Now I'm sure that UI Energy have been rather well advised about the potential of their investment - by none other than our very own Tony BLiar but that's another story (or two - or was it number 3?). Be that as it may, apart from both raising $175m yesterday, what else have GKP and Genel got in common?

Why, Ber Bahr of course.

And? Well, before yesterday, both had lots of stuff going on with current projects in Kurdistan, but not much moolah to spare for new prospects such as Ber Bahr. We know this is true for sure with regard to GKP, their May Presentation (p.4, 6, 27, 28) shows that the previous (May) $165m placing would only be sufficient for ETAMIC buyout, EWT and Production Facilities, 3D seismic on SH and SA, and the drilling of 3 appraisal wells (SH-2, 3, 4) and one exploration well (SA-1). And those that followed the failed Heritage-Genel merger will know that Genel is (was) strapped for cash to fund their Taq Taq, Tawke, Duhok, Miran, Kewa Chirmila, and Chia Sirkh license interests - not to mention Ber Bahr!

Anything else? Well yes - both companies have a Shaikan type problem when it comes to BB. Shaikan has a problem? No - it HAD a problem, but this was sorted temporarily by E-man, and then completely cleansed by the $165m placing. So what was the problem? Closure. And I don't mean closure as in removal of E-man, I mean closure (or more accurately, lack of it) on Shaikan. Oh dear, so why does BB also have this problem? Sh, it's not really a problem, it only requires 'fixing' because the structures in this part of the world are so MASSIVE. And if this particular structure is filled to spill - which is becoming increasingly more likely as a regional aquifer is proved up (we already know the most important 'result' from Bijeel-1) then the 'problem' of BB closure is clear for all to see on page 18 in the GKP May Presentation. This shows that BB has no closure to the south-east (into SA) and no closure to the north-west (into Headless Horseman). But we own SA, so why is that a problem? It's not (except that Genel may get jealous). Ok, so the problem is to the north-west then? It's not a problem - it just needs 'fixing' - before pouring money down a hole in BB, GKP and Genel will need to know that it won't end up being wasted in a bottomless pit to the north-west. GKP and Genel need to buy the Headless Horseman license - before drilling BB. IMO.

Apologies if I've skimped on some of these explanations/opinions, I have waxed lyrical about these things before:
The BIG picture:
http://www.iii.co.uk/investment/deta...ail&id=6668856

"Headless Horseman":
http://www.iii.co.uk/investment/deta...ail&id=6919929

Sorry for the verbosity, just my way of saying "an additonal block".

BBBS

P.S. For the avoidance of doubt, my previous statements about 100 billion barrels POTENTIAL were made in the context of AH + AB + SA + BB. This number would of course be absurdly conservative if there's a new kid on the block (HH is definitely big fat bully material - run your ruler Hub).

And someone has created a calculator that can be used to produce (what they believe to be) the value of the share price. The calculation is pretty impressive and has many variables:
http://dredbrick.slashmobile.net/GKP_NAV.html

[evilsatan]

As expected there has been £3m volume so far today with a current trading range of 150-152 equating to 5-6% rise in SP. The placement shares are open to trading on Thursday (taken from this mornings RNS) and more good news is expected to strengthen the SP by 8am thurs.

[lukese]

and more good news is expected to strengthen the SP by 8am thurs.

is this a hunch mate or have i missed something, what news are we expecting or is it something youve herd, ah actually is it the drilling update that they said was due in ~30 days? in quite heavy in gkp and have been following for atleast 18 months its been good to me!

[evilsatan]

is this a hunch mate or have i missed something, what news are we expecting or is it something youve herd, ah actually is it the drilling update that they said was due in ~30 days? in quite heavy in gkp and have been following for atleast 18 months its been good to me!

The shares which were released to generate the investment on friday can't be traded until Thursday, there is wide speculation that another RNS will be released by then a) to persuade the investors to hold on to their new shares even though they have made a nice margin in a week, b) because drilling updates are well overdue.

There has been rumours that GKP are withholding updates at the moment by request of some officials over there. The villagers near one of the drills have been evacuated and plumes of black smoke have been reported on iii which has caused a stir (sounds like GKP has reached oil on that drill), still no word from GKP.

The general consensus is these shares are on the edge, once they break the 52 week high of 165p anything could happen. Of course all of this could be bollocks but I am very excited what the run up to Xmas will bring

[lukese]

yeah i know what you mean re news flow it donest seem to be happening, i didnt think they where alloud to withhold share sensitive info under lse rules? im relatively new to all this been messing with it for a few years nearly though so might be wrong. i read about the black smoke i grinned also, im looking at this as a big deposit for my new house! i just hope im man enough to hold out for the future riches! have you sorted an exit straturgy yet? im looking at £5 and im gone. hopefully ill have the bottle to stay in till then.

[evilsatan]

yeah i know what you mean re news flow it donest seem to be happening, i didnt think they where alloud to withhold share sensitive info under lse rules? im relatively new to all this been messing with it for a few years nearly though so might be wrong. i read about the black smoke i grinned also, im looking at this as a big deposit for my new house! i just hope im man enough to hold out for the future riches! have you sorted an exit straturgy yet? im looking at £5 and im gone. hopefully ill have the bottle to stay in till then.

I'll play it by ear mate, I have taken my ISA out and put it into GKP but I have my full 2010 allowance to be used and GKP might well be allowed in the ISA wrapper early next year so if all goes well by Xmas I may sell to put the proceeds into my ISA wrapper then reinvest into GKP if it moves from it's current AIM position into the FTSE250 or something like that.

I am not sure if they are allowed to withold info, I have read that they may know how much oil they have but are waiting on the politics. But this is just hearsay. There is definitely a lot going on behind the scenes though with Fridays money being rounded up and some suggestions in todays RNS that there may be an opportunity coming up soon hence the requirement for additional funds.

They don't expect to fully value the oilfield until half 1 of 2012 so there is a long time to add a lot of value to the SP if a takeover doesn't come first. This could really make a lot of people