Independent producer Genel Energy reported Tuesday that the third quarter of 2015 has proved to be a "turning point" for the company thanks to payments from the Kurdistan Regional Government of Iraq as well as exports from the region hitting record levels.
During the third quarter, the company received cash proceeds of $45 million, which included domestic Kurdistan sales proceeds of $20.5 million as well as the September 2015 export payment of $24.5 million. The receipt of the export payment led to cash balances increasing by $7 million during the period to $481 million by the end of September.
Genel's revenue during the third quarter came to $77 million, with total revenue for the first nine months of the year amounting to $276 million.
The firm said that a further payment of $24.5 million for exports from its Taq Taq and Tawke fields in Kurdistan is expected imminently.
Net working-interest production and sales for the 3Q 2015 averaged 86,100 barrels of oil per day – which was an increase of 23 percent over 3Q 2014 oil production. However, Genel also reported that production at both Taq Taq and Tawke has declined from the peaks reached during the second quarter of this year.
Commenting in a statement contained within Tuesday's trading update, Genel Chief Executive Murat Özgül said:
"The third quarter of 2015 has been a turning point for Genel. September's payment for exports, coupled with local sales, has stabilised the receivable owed to us by the Kurdistan Regional Government. An October payment for Taq Taq and Tawke is set to be received imminently. With total exports from the Kurdistan Region of Iraq again hitting record levels, and pipeline uptime improving, we have confidence in the KRG's commitment to make regular payments for oil exports."
Genel also said that drilling on its CI-508 license (in which it has a 24-percent working interest) offshore Côte d'Ivoire is set to commence towards the end of 2015, targeting the Aigle prospect.
Analysts at London-based investment bank FirstEnergy described the anticipation of payment of $24.5 million as "encouraging" but noted that "the reduction of production at Taq Taq and Tawke in the current uncertain political context in Kurdistan is an issue".
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