Gulf Keystone Petroleum and ShaMaran Petroleum propose $1bn merger

Gulf Keystone Petroleum and ShaMaran Petroleum have announced a proposed merger to create a leading independent oil producer focused on the Kurdistan Region of Iraq and Federal Iraq. The transaction, to be implemented as a statutory merger under Bermuda law, is expected to result in a combined company with a pro-forma market capitalisation exceeding US$1 billion.

Upon completion, shareholders of Gulf Keystone and ShaMaran will each own approximately 50 percent of the combined entity. Under the terms of the deal, ShaMaran shareholders are set to receive newly issued Gulf Keystone shares valued at approximately US$601 million. Additionally, Gulf Keystone intends to pay a US$50 million special dividend to its existing shareholders at closing, subject to board approval and Bermuda law.

The merger will consolidate four oil assets across the Kurdistan Region and Federal Iraq. The combined company is projected to have estimated working interest 2P reserves of 323 million barrels and a pro-forma working interest production of 53,000 barrels of oil per day. Both companies' boards have unanimously approved the transaction, which remains subject to shareholder and regulatory approvals. Completion is anticipated in mid-2027.