Feb. 1 (UPI) -- Iraqi oil player Gulf Keystone Petroleum said it was planning further investments this year, but still facing commercial pressures.
The company is among those with a strong focus on the oil reserves in the semiautonomous Kurdish north of Iraq, which has been relatively stable even as the terrorist group calling itself the Islamic State made territorial claims in the region.
Operating the Shaikan oil field in the Kurdish region, Gulf Keystone reported total average gross production for 2016 at 34,794 barrels of oil per day, at the upper range of its guidance for the year.
CEO Jon Ferrier said in a statement he was pleased with the performance last year as most companies were squeezed considerably by a market downturn characterized by historically low crude oil prices. For 2017, the company's balance sheet is in order, the Shaikan field is well understood and investments should start to increase.
"However, commercial and contractual clarity around payments and marketing remain key to achieving production growth and realizing full value potential," he said.
Gulf Keystone Petroleum, which has headquarters in London, was the target of an unsolicited takeover from rival Iraqi player DNO, a Norwegian oil company. In 2015, Gulf Keystone had mulled possible partnerships, but emerged last year with an agreement with the majority of its creditors and shareholders to restructure its debt obligations
Once completed, the company said it would cut its debt load by approximately 80 percent to $100 million, which could in turn free up millions of dollars in cash.
Iraq is among the top oil producers in the Organization of Petroleum Exporting Countries, which agreed to sideline a collective 1.2 million bpd to achieve balance between supply and demand. The OPEC deal uses an Iraqi oil production volume of 4.56 million bpd as a benchmark for a cut of about 4.6 percent.
The central government in Baghdad is at odds with the Kurdish government over compliance.