Increased exports in the pipeline for Rothschild's Genel
Genel Energy, the Kurdistan-focused oil producer backed by the financier Nat Rothschild, has announced plans to step up exports next year.
The company, which is run by the former BP chief executive Tony Hayward sells most of its oil to Kurdistan's domestic market, with the remainder sent to Turkey. However, it said it will be able to export a much larger volume of oil from next year when a pipeline connecting its main Taq Taq oilfield in the semi-autonomous region of Kurdistan to Turkey is completed.
The pipeline would reduce Genel's reliance on a Baghdad-controlled pipeline to Turkey, which Kurdistan stopped using in December after Iraq failed to honour all the payments it had agreed to make for the oil. Iraq views Kurdistan exports as illegal, and meetings between Iraq's oil minister and his Kurdish counterpart in Baghdad on Wednesday failed to resolve the long-running dispute.
Julian Metherell, Genel's chief financial officer, said: "We can expect by 2014 to be accessing the export markets from our major assets, whether that is through Baghdad-controlled infrastructure or through independent Kurdistan infrastructure.
"Most critically, the infrastructure is under construction, which has the potential to remove the prevailing reliance on Baghdad-controlled infrastructure," he added.
Increasing exports should help Genel to boost revenues because a larger pool of potential buyers should see the oil fetch a higher price. In its first full-year set of results since it was incorporated in April 2011, Genel reported a $75.9m (£50m) profit for 2012 on $333.4m of revenues. Average daily production was 44,500 barrels, and that should rise to between 45,000 and 55,000 this year, Genel said. Revenues should increase to between $300m and $400m.
The company was created in 2011 when Turkey's Genel Enerji was reversed into a cash shell set up by Mr Rothschild, who still has a 10 per cent shareholding. Genel is, however, faring much better than Mr Rothschild's other major creation, Bumi, which has seen its shares dive amid his battle with his co-founders, Indonesia's Bakrie brothers, over corporate governance.
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