April 11 (UPI) -- With a crude oil sales agreement in hand, British energy company Gulf Keystone Petroleum said it turned a profit for the first time for its Kurdish operations.
The company, which has headquarters in London, was the target of an unsolicited takeover from rival Iraqi player DNO, a Norwegian oil company. In 2015, it had mulled possible partnerships, but emerged the following year with an agreement with the majority of its creditors and shareholders to restructure its debt obligations.
Gulf Keystone said Wednesday its net profit for full-year 2017 was its first since it entered the Kurdish north of Iraq, thanks in part to a crude oil sales agreement from its Shaikan field.
"We are pleased to have reported a net profit for the year of $14.1 million, compared with a net loss of $17.4 million in 2016," CEO Jón Ferrier said in a statement.
The company in January said its guidance for the year for production was around 32,000 barrels of oil per day at the high end. Its range was limited because of the lack of upstream infrastructure. Gross production for the third quarter was 35,550 bpd and the company said it averaged 35,298 bpd for full-year 2017.
Guidance for the year was unchanged. It operates the Shaikan reserve and that asset made up nearly all of its production.
"We are confident that once we are able to restart investment into Shaikan we will be able to lift production towards our near-term target of 55,000 bopd, a step towards the full field development," Ferrier said.
The company ended 2017 with a cash balance of $160 million, a 72 percent improvement over 2016. Its operating cost moved from $3.50 per barrel to $2.80 per barrel last year.
The Kurdish north was embroiled in a multifaceted risk environment last year, lending to uncertainty for operations. Gulf Keystone said some of those issues have "come at a considerable human and economic cost."