DNO, Genel, KRG reach oil sales deals

OSLO, August 24, 2017 – DNO and Genel Energy have reached separate agreements with the Kurdistan Regional Government (KRG) under which debt will be cleared and oil export payments restructured, the two companies announced on Thursday.

DNO’s outstanding receivables for the Tawke licence have been settled by the KRG, the Norwegian company said in a press release. The company will also acquire the KRG’s 20% stake in the licence, increasing its interest to 75%.

“This sends a strong positive signal to investors and helps restore confidence in Kurdistan’s oil sector,” DNO executive chairman Bijan Mossavar-Rahmani said.

Genel Energy reported the settling of debt from past oil sales from the Taq Taq and Tawke fields. Under its agreement, the company will also receive a greater proportion of revenue from oil sales from Tawke, increasing its take to 4.5% for the next five years.

“Cash flow is expected to be materially enhanced over the course of the agreement, delivering significant value creation for all stakeholders,” the company said.

Following Wednesday’s news, the two companies each saw a rise in share prices. Genel Energy shares gained 6.9% and DNO shares gained 6.5%.

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