Genel Energy shares plummet after KRG terminates gas field projects

ERBIL (Kurdistan 24) – Genel Energy in a statement on Friday said that they received a notice of termination from the Kurdistan Region’s Government Ministry of Natural Resources for the Bina Bawi and Miran natural gas field projects. 

The shares of the UK based company plummeted near 16 percent, the lowest in more than a year, in London trading after the announcement.

“Genel wishes to continue operations under the production sharing contracts and to work with the KRG on the development of these fields. However, Genel will take steps to protect its rights under the PSCs and, if necessary, seek compensation, including for its material investment,” the company said in a statement.

Genel said it was planning “to hold good faith negotiations to resolve this matter promptly without the need for either party to refer the matter to international arbitration.”

The producer has been unable to develop the gas resources after talks over their development stalled, Bloomberg reported on Friday.

Bina Bawi and Miran contain an estimated 14.8 trillion cubic feet of raw gas in addition to 130 million barrels of oil and condensate resources.

The Ministry of Natural Resources has not yet commented on the termination of two gas fields.

Bina Bawi and Miran are both still in the pre-production stage. The company reached a “commercial understanding” with the KRG to develop the fields two years ago.