Joint agreement between two oil companies to expand operations in the Kurdistan Region

According to KurdPress, Gulf Keystone Petroleum and Shamaran Petroleum are seeking to form one of the largest oil production complexes in the Kurdistan Region of Iraq by agreeing to merge shares in the Kurdistan Region’s oil fields worth approximately $601 million. Its market value is expected to exceed $1 billion and its daily production will reach about 53,000 barrels.London-listed Gulf Keystone Petroleum announced on Tuesday, October 20, an agreement to merge with Oslo-listed Shamaran Petroleum. The deal aims to combine the two companies’ oil assets and expand their operations in the Kurdistan Region of Iraq.

Shamaran Petroleum is valued at an estimated $601 million in the deal. The new company, with a market value of more than $1 billion, will have an estimated production of about 53,000 barrels of oil per day based on its operating share and proven and probable reserves of 323 million barrels.

The merger of the two companies will combine Gulf Keystone’s Sheikhan oil field with Shamaran Petroleum’s stake in the Atrush and Sarsang oil fields. The consortium also plans to invest in the Hamrin field in the federally controlled part of Iraq.Gulf Keystone Petroleum intends to transfer its principal place of trading to the Euronext Oslo main market and eventually delist from the London Stock Exchange as part of the deal. However, the implementation of the deal is subject to shareholder approval and the fulfillment of other closing conditions, with completion expected in the first half of 2027.

The Sheikhan oil field in Dohuk province is Gulf Keystone Petroleum’s most important asset and one of the largest oil producing fields in the Kurdistan Region. Production from the field has recently returned to around 40,000 barrels per day. Sheikhan’s gross proven and probable reserves are estimated at around 416 million barrels, and the field has produced more than 155 million barrels of oil since commercial production began in 2013.

The moves by foreign companies to merge and acquire oil assets in the Kurdistan Region are not limited to Gulf Keystone and Shamaran.Genel Energy and DNO have also submitted competing bids for Capricorn Energy, with Capricorn’s board of directors supporting Genel Energy’s increased bid.

The Gulf Keystone-Shamaran deal, if finalized, would increase the concentration of the two companies’ oil assets in the Kurdistan Region and could pave the way for more integrated management of the oil fields and expansion of their production activities.