I’ve been following Genel Energy of Turkey for a while now, not least because of my obsession with the potentially catastrophic but otherwise fantastic venue that is Iraqi Kurdistan. Every week I see this moving fast in two directions: towards potential all-out conflict with Baghdad and towards an oil and gas goldmine.
There are other juniors worth looking at in this venue, but it always comes back to Genel, whose CEO is—not incidentally—former BP exec Tony Hayward.
This week, Genel’s shares on the London stock exchange rose 7% on a significant new oil find in Iraqi Kurdistan. A test on Genel’s Chia Surkh-10 well has yielded flow rates up to 11,960 barrels per day, plus 15 million cubic feet of gas.
The company has a market cap of £1,816.76 million, closing on the London Stock Exchange at £850.00, with 213,736,679 shares in issue.
Genel is the largest producer in Iraqi Kurdistan, and its holdings are impressive. We’re talking about 7 production-sharing contracts with some nice geological diversity. Its largest producing fields in Kurdistan are Taq Taq and Tawke, which have an estimated gross proven and probable reserves of 1.4 billion barrels of oil and gross proven, probable and possible reserves of 1.9 billion barrels. By 2014, Genel is aiming for a production capacity of 140,000 net bopd.
That’s just existing capacity. It gets better. Juniors in Iraqi Kurdistan have had an amazing…