R-factor update30 Mar 2022 14:27
The FYR2021 stated:
"As at 31 December 2021, there were $401 million gross of unrecovered costs, subject to potential cost audit by the KRG. The R-factor, calculated as cumulative gross revenue receipts of $1,478 million divided by cumulative gross costs of $1,543 million, was 0.96. The unrecovered cost pool and R-factor are used to calculate monthly cost oil and profit oil entitlements, respectively, owed to the Company from crude oil sales."
Since then gross payments of $136 m were made (£106.4 m net to GKP), thus:
Total gross cumulative revenue = $1,478 m + $136 m = $1,614 m
Assuming costs for Q1 2022 = $30 brings the total cumulative costs to $1,573 m.
Current R-factor = 1.026. Not too far off my estimate posted earlier.
However, what is puzzling me is that last year GKP reported a cumulative revenue of $1,182 m and this year it is $1,478 m. The difference = $296 m, but the reported cumulative gross payments of all 2021 as reported by the RNSs add up to $283.1 m! So, where does that additional $12.9 m come from?
Another issue, which I think is quite important is the replacement of the old COO Stuart Catterall by John Hulme. I must say I am glad! During Stuart's 5 year reign as COO of GKP there were only 4 completed drills:
1 - SH-12, now it is shut in because of water ingress.
2 - SH-9 spudded to find a gas cap that could be used for the gas management plan. It failed and was converted into a production well.
3- SH - 13, had to undergo an acid treatment to bring production to an acceptable level.
4- SH -14, experienced well bore issues and had to be side tracked plus other problems.
Is that just sheer bad luck or is the Shaikhan field too complicated for Stuart? SH - 15 drilling/completion still ongoing. And no ESP installed so far, in fact the FYR avoided mentioning them altogether! Let's hope that John Hulme will have better luck as GKP's COO.
Best Regards ValueS
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