OSLO, Norway, Aug. 18 (UPI) -- If accepted, a merger with Gulf Keystone Petroleum, an Iraqi-focused company, would provide an advantage in terms of reserves, Norway's DNO said.
DNO, a Norwegian oil and gas company with strong Iraqi assets, made a $300 million bid for Gulf Keystone Petroleum in July. Both companies are working in the Kurdish north of Iraq, with the latter working through a debt restructuring effort.
In a statement on production gains, DNO said the merger, if accepted by Gulf Keystone Petroleum and approved by the Kurdish government, made strategic sense.
"Combined, DNO and Gulf Keystone would place first among European independent exploration and production companies in terms of production and also proven and probable reserves," DNO said in a statement.
With its merger target working through restructuring, DNO said its operating profit during the second quarter doubled from first quarter to $16 million. For the fifth quarter in a row, the company said its net revenue was higher than $50 million. A profit reported during the first quarter was a first for the company since 2014.
DNO is working in the Tawke oil reserve area in the Kurdish north of Iraq, producing about 117,000 barrels of oil per day.
Gulf Keystone Petroleum, focused on development the Shaikan oil field in the Kurdish north, said in early August that most of the parties with an interest in the company are in favor of restructuring. Restructuring would support near-term plans to raise production from 40,000 bpd to 55,000 bpd.