Gulf Keystone looking to cash in on Iraq's black gold

14th Jun 2011 11:50

The Iraq focused oil company Gulf Keystone Petroleum is reporting some success at its Shaikan-1 and Shaikan-3 facilities in the Kurdistan region of the country.The AIM listed firm says it is now in the commissioning phase of its operations at the site and is aiming to produce 10,000 barrels of oil per day (bopd) within eight months, with a shorter term target of 5,000 bopd.Vugar Aliyev, an analyst at Matrix Group acknowledges that the start of exports is positive for Gulf Keystone but cautions that the logistics currently do not work in the firm's favour. He estimates trucking costs for the oil could be as much as ten dollars per barrel which would eat into margins.The bigger game, he argues, is the connection of the Shaikan site to the Kirkuk-Ceyhan pipeline which, according to early estimates, could cost $120m.