Gulf Keystone CEO on how ShaMaran merger could boost production, cut costs and unlock growth

Gulf Keystone Petroleum announces a merger with Shamaran Petroleum, aiming to create a leading independent oil producer focused on Kurdistan and Iraq. The merger is expected to enhance shareholder value by diversifying the company's portfolio and reducing reliance on cash flows from the Shaikan field. The combined entity is projected to increase production from 28,000 barrels per day to 53,000 barrels, with potential growth towards 100,000 barrels per day as the development of both Shaikan and the Hamrin field progresses.

The merger is structured as a 50-50 deal, which Gulf Keystone CEO John Harris believes is fair for shareholders, despite initial concerns about the balance of contributions from both companies. The deal includes a $50 million special dividend for Gulf Keystone shareholders and aims to improve liquidity and access to financing. Additionally, Gulf Keystone plans to delist from the London market and move its primary listing to Oslo, citing cost savings and better trading liquidity as key reasons for the shift. The company reassures UK retail investors that they will still have opportunities to participate in the new structure and that the transition will be handled smoothly.

Gulf Keystone Petroleum Limited (LSE:GKP) CEO Jon Harris spoke with Proactive's Stephen Gunnion about the proposed merger with another Kurdistan-focused oil producer, the potential for higher production and what the deal could mean for shareholders.

Harris explained how the proposed 50:50 combination with ShaMaran Petroleum would bring together four complementary, low-cost, long-life assets to create a larger independent producer with greater scale and more diversified cash flow.

Combined net production could rise from around 28,000 barrels of oil per day to 53,000 bopd, with longer-term potential to approach 100,000 bopd as development opportunities at the Shaikan and Hamrin fields are realised.

The discussion covered plans to develop Hamrin in Iraq, the proposed US$50 million special dividend for Gulf Keystone shareholders and how future cash flow could support investment and sustainable shareholder returns.

Harris also outlined the proposed move to a single Oslo stock market listing, explaining how it could improve trading liquidity, reduce costs and broaden market access. He addresses the implications for UK retail investors, including the proposed timetable and share-transfer arrangements.

Watch the full interview for Harris’s case for the merger, production growth prospects and what comes next for shareholders.

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