Member Info for PUTUP

They weren't paid because they didn't produce enough. Reimbursement comes from cost oil i.e. a share of production. I said they've "been largely reimbursed." The Gross CRP balance as of 30 June '23 was $224 million. That included all costs to June but only receipts until that for Sep 22 production. GKP's share of this off-balance sheet asset was $179 million. Of the $151 million in invoices for Oct 22 to Mar 23, about $121 million is cost recovery. Once the receivables are collected there's little left in the CRP balance, just a couple of good months of normal production with export sales. Then reimbursement will be done.

Sorry for your loss. The CRP balance carried forward post restructuring. It was a key asset (off balance sheet) that attracted those who did the restructuring. The company discloses the value of the CRP on a six monthly basis. The disclosure is the gross figure. I’ve provided this amount a few posts ago as well as the amount of CRP recovery embedded in the receivables balance. Dividends (and buybacks) have been funded by recovery of this asset balance. If you don’t understand or follow the CRP you do so to your detriment.

"after Nahawi has gifted Sinopec a 10% toehold in Gulf Keystone during restructureSINOPEC use unique Dutch legal structure "STICHTING" - to hold this toehold without market being aware"

How does a recruitment agency fit into your Sinopec conspiracy theory? Ownership of Impellam Group

https://investors.impellam.com/shareholder-services/#module-842170142

https://tools.morningstar.co.uk/uk/stockreport/default.aspx?tab=5&vw=own&SecurityToken=0P0000IOSB%5D3%5D0%5DE0WWE%24%24ALL&Id=0P0000IOSB&ClientFund=0&CurrencyId=BAS

Same two characters as in GKP. Hendrik M. Van Heijst aka Stichting Value Partners. And Ophorst van Marwijk Kooy aka InsingerGilissen Bankiers NV.

Just two Dutch guys trying to make money.

Maybe when Sinopec takes over they need to hire some people. 🤣🤣🤣🤣

Company doesn't have much to say. No material changes?

"PUTUP, interesting thought process, but some how i thik your wrong implying the reserves have no value to the Company as they belong to IRAQ? "

I never said this. The reserves do have value to the company to the extent the company has a contract to extract them. If the reserves weren't sufficient to last until the end of the PSC then we'd be in a lot of trouble. But the company has no entitlement to reserves. It has an entitlement to a share of production over the life of the contract.

And despite what the idiot Jake thinks, that working interest isn't 80%. The Working Interest is 61.5% of a figure which ranges from 30% to 15% dependent on the R Factor. Currently that R Factor is circa 1.18 meaning the WI in profit oil is 27%. So GKP's working interest in the field is currently 61.5% of 27% = 16.6%.

The Contractor recovers costs via Cost Oil. It earns no margin on cost oil. The contractor is 80% GKP and 20% MOL. 80% is NOT GKP's working interest in the field.

Correct. And this seems totally lost on people here. As I said earlier

"The KRG has largely already reimbursed operators for their asset expenditure thus far. The reserves aren't the property of the operators; they're the property of Iraq."

And

"The fixed assets on our balance sheet reflect a mismatch between cost less depreciation and the Cost Recovery Pool. Make no mistake, Iraq 'owns' the fixed assets already. "

GKP's share of the CRP as of June 30 was 80% of $224 million = $179 million. But that was costs up to June 30 and only receipts up to and including Sep '22's production. Of the $151 million in o/s receivables, about $121 million or so is cost recovery. Once the receivables are paid and with production restart, pretty soon there isn't going to be much they owe in terms of CRP at the end of each month.

Arguably, there is a case for GKP's fixed assets to be written down to our share of the remaining CRP. The accounts are misleading by running them at cost less depreciation. (But who cares about such non-cash issues.)

Our entitlement extends to a share of production, and NOT reserves, over the life of the contract. The same contract we all hope will be ratified. (If you don't want to read the contract itself read the summary of it in the 2016 restructuring prospects available on the company's website.)

GKP has to work carefully and responsibly as they transition into the new regime. They need to be sen as a good partner for Iraq.

WTF - posts keep getting truncated

- I don't expect it to have change significantly (ie less than 10%) as they normalize payables etc

4. Pipeline ready but discussing contracts etc. Expect a repeat of the blah blah coming from KRG officials which we've known for months

Anything else?

Oops somehow that got cut short

- I don't expect it to have changed significantly (i.e.

One month since last one. What are you guys expecting?

1. Production update.

- I have 35k for Oct

2. Local sales pricing

- I've kept it at $30

3. Cash balance

- I don't expect it to have change significantly (i.e.

"It changes"

Obviously, first and foremost it changes with the price at which the field's oil is sold at. The last payment we received was for Sep 22 production. Profit Oil - CBC was approximately $4.14 per barrel (+/-)*. Brent averaged $90 that month. It will also change with the R Factor and when Cost Oil shifts to Profit Oil (i.e. when the CRP is fully recovered each month).

* That month, WITH COST RECOVERY, GKP received a bit over $20 per barrel. The bid-ask spread between that and the $6 currently offered is wide. A company can work of less than $6 if they get their direct costs reimbursed but not when they don't.

"but the production companies in KRI have issues with the allocation of production costs. They believe these allocations do not align with actual production costs, and, therefore, they refuse to export oil until this matter is resolved."

As I said on the 20th: "The issue is Cost Recovery (capex, direct opex and direct Shaikan G&A)."

It changes but about $4.20 less corporate overhead costs per barrel were they producing and piping normally at the moment.

@Invstrat I'm better sober

Just to round it out for those wondering where the overall 36% share comes from, this is the receipt when the CRP is such that Cost Oil is the maximum 40% of field sales net of the 10% royalty.

GKP's share of Cost Oil = Gross field sales x 90% x 40% x 80% = Gross field sales x 28.8%

Add the 7.2% from Profit Oil less CBC and you get 36%.

But no margin is made on 80% (28.8/36) of the 36%. (Yet there is a cost of capital to funding the CRP.) From the Profit Oil less CBC income stream the company must pay its corporate overhead costs (anything that isn't recoverable under the PSC).

GLA

Amongst all the BS being spouted by Jake it's worth reminding people of some of the key terms of the PSC, as modified by the bilateral agreement, that we hope will be ratified under the new oil & gas law framework. Just facts.

GKP doesn't own the reserves. Its entitlement is a share of production.

Royalty to KRG/Iraq 10% (comes out of field sales proceeds first)

Cost Oil = the LESSER of 40% of sales proceeds less royalty and Cost Recovery Pool balance. Intended to reimburse the contractor, from production proceeds, for their capital expenditures and operating costs to develop the field and direct Shaikan G&A expenditures. No margin is earned on this by the contractor. KRG/Iraq are paying the contractor back for all their hard asset expenditure and direct operating costs. (The fixed assets on our balance sheet reflect a mismatch between cost less depreciation and the Cost Recovery Pool. Make no mistake, Iraq 'owns' the fixed assets already.)

Cost oil is split between the contractors 80% GKP and 20% MOL and the costs themselves are incurred in the same ratio

All the rest of sales proceeds ex royalty are Profit Oil

Working Interest Share of Profit Oil - a sliding scale between 30% and declining to 15% dependent on R Factor

Current R Factor circa 1.18 => WI Share of Profit Oil of circa 27%

All the rest of Profit Oil goes to KRG/Iraq

Split of Working Interest in Profit Oil:

GKP 61.5%

MOL 18.5%

KRG 20.0%

So the GKP's share of the current 27% is 16.6%

GKP pays a Capacity Building Charge of 20% of its Profit Oil

There are timing differences between when direct costs are incurred and when they are recovered. This is reflected in the CRP balance. The contractor has to have capital to fund these timing differences. When a lot of costs are being incurred with little recovery (eg from inception until about two years ago) that capital requirement is large (and the cost of capital expensive). When production/sales levels allow cost recovery greater than current cost incurrence that capital is recovered and is no longer needed and can be returned to shareholders. But no margin is made on this capital incurred except through the Profit Oil less CBC mechanism.

Given currently the CRP balance (opening monthly balance plus the months direct costs) exceeds the 40% limit, Profit Oil is (for now) limited to 60% of field sales less the royalty. So GKP, currently, gets (with parentheses to make following the above easier):

GKP Profit oil share less CBC = (Field Sales -10%) x 60% x (27% x 61.5%) x (1 -CBC of 20%) = 7% of gross field sales

As the R Factor rises and the 27% falls towards the lower limit of 15% the share of gross field sales falls. When costs are fully recovered Cost Oil falls below the 40% max threshold, production shifts from Cost Oil to Profit Oil, the 60% in the above equation goes up and the share of gross field sales rises but we lose the cash flow associated with our greater share of Cost Oil

" I would ask/beg you for a little kindness"

Haha Straycat. Fair cop. Now back to nursing my hangover. Send some Neurofen.

GRH1-returns "BANG GONE". Now where have we heard that before?

"The Value Partners Stichting that holds just over 10% of GKP equity appears to be the work of

HTTPS://www.valuepartners-group.com/en/about-us/contact-us/

A very large Chinese asset manager Head Office Hong Kong. "

Here's some public disclosure about the real Stichting Value Partners Family Office. No conspiracy theory needed. Just a Dutch guy trying to make money.

Stichting Value Partners Family Office

Stichting Value Partners Family Office is controlled by Mr Hendrik Marius van Heijst. During 2021, Mr Hendrik Marius van Heijst has held a shareholding in Oceanteam ASA of greater than 20% and is therefore considered to have significant influence. In April 2018 a loan was issued by Stichting Value Partners Family Office.

https://www.oceanteam.nl/bestanden/import/Oceanteam_ASA_-_Interim_Report_-_H1_2021.pdf

"2012+20=2032"

Yeah that will teach me not to post after being out on the turps! Mea culpa.

But we've been reimbursed for our 'assets' already. We don't own the reserves. We are entitled to a share of PRODUCTION. That share is Profit Oil less CBC. Work it out. Even over 11 years it isn't billions.

"a Commercial Discovery was announced by the Company in August 2012 and therefore GKPI and MOL, as contractors, have the exclusive right to develop and produce the Commercial Discovery for a period of 20 years from the date of discovery, with an automatic right to extend for an additional period of five years and an optional further five year extension."

With respect to the "optional" extension:

"If, following the expiration of a development period, the Shaikan Contractors consider that commercial production in respect of a particular production area is still possible, it may request to extend the applicable development period for an additional five years."

So the 20 years are up and we are one year into the first extension period. Presumably a "request" to extend a further 5 years can be denied.

GKP and APIKUR need to act as responsible partners to Iraq. If they don't, they're done.

The KRG has largely already reimbursed operators for their asset expenditure thus far. The reserves aren't the property of the operators; they're the property of Iraq. How long does our PSC have left to run...?

Nah, it's just one Dutch guy Mr Hendrik Marius van Heijst. You're so stupid you've looked up the wrong entity. Doofus.