A sales process handled by Deutsche Bank was believed to have closed in May, finding no firm interest in Gulf. However, it has been suggested that T5 — formed by former Tullow Oil directors and fronted by that company’s former chairman, Pat Plunkett — is still actively looking at a potential deal.
One source said yesterday that T5 is still in talks with Gulf as well as other potential targets. Earlier this year, T5 admitted that it is eyeing up firms and assets in need of investment and has identified around six reverse takeover targets active in the African and Middle-Eastern regions. Mr Plunkett said back in the spring that T5 would likely be “very active” in the marketplace this year.
However, another source suggested that while the Gulf Keystone sales process is likely to be “ongoing”, as was indicated at the company’s AGM just last week, the London company could opt to “tough it out” until it receives outstanding payments from the Kurdistan Regional Government (KRG).
The KRG aim to raise between $500m and $1bn from a bond issue, which would help it pay owed monies to numerous companies operating in the region. The Government fell out with Iraq last year over an agreement on how it sells its oil, severely curtailing its budgets, forcing it to suspend payments to oil companies operating in its region.
Another UK explorer, Genel — also linked with a move for Gulf Keystone — said yesterday that it has put on hold all planned 2015 exploration work as a means of saving around $50m in costs and lowering its current year expenditure to a $150m-$200m range. Genel’s chief revenue stream — basically, its operations in the Kurdistan region of Iraq — have been restricted by the KRG’s monetary struggles. The amount Genel — chaired by former BP chief and current Glencore Xstrata chair, Tony Hayward — is owed by the KRG has jumped from $230m to $378m in the first half of 2015, while Gulf is awaiting payment of around $250m.
Genel, which could also end up as a takeover target according to some, is forecasting $200m in first half revenues, which are due to be reported early next month.
Last year, Genel made a number of unsuccessful exploration drives, resulting in it writing off nearly $500m of assets after poor drilling rounds in the eastern Mediterranean and Africa.