LONDON (Alliance News) - Gulf Keystone Petroleum Ltd Thursday said its pretax loss was narrower in 2015 following a substantial lift in revenue during 2015, and said it plans to increase production and lower costs this year.
The oil producer operating in Iraq said its revenue in 2015 was substantially higher than the year before, but said it remained in the red by reporting a USD135.0 million pretax loss. However, that is substantially narrower than the USD248.2 million loss booked in 2014.
However, the rise in revenue to USD86.2 million from USD38.6 million failed to turn its operations profitable as it said its gross loss in the year amounted to USD50.7 million compared to the USD43.3 million loss last year.
The main driver of the narrower loss was a big reduction in impairments to only USD3.6 million in 2015 compared to the USD144.1 million booked a year earlier, alongside a fall in administrative costs to USD31.0 million from USD39.0 million.
However, that was partly offset by the company's finance costs soaring to USD52.1 million in 2015 from USD19.8 million in 2014.
Gross production in the year averaged 30,500 barrels of oil per day, a rise of 71% from 2014, and said that will rise to the region of 31,000 to 35,000 barrels a day in 2016, subject to offtake and export infrastructure availability.
"The reasons behind my initial attraction to Gulf Keystone remain my motivation today. We have a superb subsurface asset, which continues to perform well, and a motivated workforce dedicated to realising Shaikan's full potential. We started 2015 with installed capacity to produce 40,000 barrels per day and achieved our guidance with a 30,500 barrels a day average rate, as well as record levels of over 45,000 barrels a day achieved during the year," said Chief Executive Jon Ferrier.
Gulf Keystone also plans to reduce its operating costs further to around USD4.5 per barrel in 2016 from the USD5 per barrel in 2015.
Gulf Keystone shares were down 12% to 10.49 pence per share on Thursday.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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Gulf Keystone Petroleum (GKP)