Gulf Keystone Petroleum reported gross average production of 14,600 barrels of oil per day (bopd) for the first half of 2026, down 67% from 44,100 bopd a year earlier, after a precautionary shut-in of the Shaikan Field between 28 February and 23 June.
The Kurdistan Region of Iraq-focused operator and producer said a second shut-in followed between 19 July and 15 August, before output resumed on 16 August and is now approaching 40,000 bopd gross.
Revenue based on entitlement invoices held broadly flat at $82.8 million (H1 2025: $83.1 million), while adjusted EBITDA rose to $51.7 million (H1 2025: $41.1 million) as a 25% cut in operating costs to $20.2 million offset lower volumes.
Free cash outflow narrowed to $2.0 million, against $24.6 million of free cash flow generated a year earlier, and the company held $63.5 million in cash and remained debt-free as of 24 August.
"Decisive action to reduce expenditures has enabled us to minimise cash outflow, maintain a robust, debt-free balance sheet and pay a $12.5 million dividend to shareholders", said chief executive Jon Harris.
The board declared an interim dividend of $10 million, or $0.046 per share, down from the $12.5 million paid in April, payable on 28 September to shareholders on the register at 11 September.
Tripartite export agreements between the international oil companies, the Federal Government of Iraq and the Kurdistan Regional Government have been extended six months to the end of January 2027, and the company is seeking additional liftings in the third quarter to reconcile export sales since September 2025 to international prices.
News Intelligence what this means for the company
Gulf Keystone has resumed Shaikan output after two security-driven shutdowns in H1 2026, with production now approaching 40,000 bopd gross. The company declared a $10 million interim dividend despite a 67% production collapse in the first half—revenue held flat at $82.8 million because it invoices at entitlement prices rather than spot, but free cash swung from +$24.6 million outflow to -$2.0 million inflow, achieved through a 25% operating cost cut. The real test is whether tripartite export agreements extended to January 2027 will let Gulf Keystone secure additional liftings to reconcile export sales since September 2025 to international prices—a regulatory and commercial hurdle, not yet cleared.
The dividend cut (from $12.5 million to $10 million) and cash outflow in H1 despite flat revenue signal that production shutdowns and export constraints are eroding cash generation faster than cost cuts can offset. The $63.5 million cash position is down $2.5 million from $66 million on 18 June, and sustainability hinges on export entitlement disputes being resolved and production ramping back to pre-shutdown levels—neither yet assured.
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