Half Year 2026 Gulf Keystone Petroleum Ltd Earnings Call

August 25, 2026

Speaker #1: Good morning, and welcome to Gulf Keystone Petroleum's 2026 Half-Year Results Presentation. At the end of today's presentation, there will be an opportunity for Q&A.

Operator: Good morning, and welcome to Gulf Keystone Petroleum's 2026 half-year results presentation. At the end of today's presentation, there will be an opportunity for Q&A. For participants joining via the conference call, you may ask a question by pressing star one on your telephone keypad. For those listening through the webcast, you can submit a written question at any time by clicking on the control panel at the bottom of your screen and selecting the questions icon to type it in. We will take analyst questions from the conference call first, followed by investor questions from the webcast. I will now hand over to Chief Executive Officer, Jon Harris. Jon, please go ahead.

Operator: Good morning, and welcome to Gulf Keystone Petroleum's 2026 Half-Year Results Presentation. At the 6 of today's presentation, there will be an opportunity for Q&A. For participants joining via the conference call, you may ask a question by pressing star one on your telephone keypad. For those listening through the webcast, you can submit a written question at any time by clicking on the control panel at the bottom of your screen and selecting the questions icon to type it in. We will take analyst questions from the conference call first, followed by investor questions from the webcast. I will now hand over to Chief Executive Officer, Jon Harris. Jon, please go ahead.

Speaker #1: For participants joining via the conference call, you may ask a question by pressing *1 on your telephone keypad. For those listening through the webcast, you can submit a written question at any time by clicking on the control panel at the bottom of your screen and selecting the Questions icon to type it in.

Speaker #1: We will take analyst questions from the conference call first, followed by investor questions from the webcast. I'll now hand over to Chief Executive Officer Jon Harris.

Speaker #1: Jon, please go ahead.

Speaker #2: Thank you. Welcome to Gulf Keystone's 2026 half-year results presentation. I'm Jon Harris, the CEO, and I'm joined by Gabriel Papineau-Legre, our CFO. Over the next few slides, we will discuss our operational and financial performance in the first half of 2026 and the current outlook for the business.

Jon Harris: Thank you. Welcome to Gulf Keystone's 2026 H1 results presentation. I am Jon Harris, the CEO, and I am joined by Gabriel Papineau-Legris, our CFO. Over the next few slides, we will discuss our operational and financial performance in H1 2026 and the current outlook for the business. We will then open the line for questions. Next slide, please. This is our regular legal disclaimer, and I will leave you to review at your leisure. Presentation slides are available to view on our website. Next slide, please. Gulf Keystone delivered a resilient operational financial performance in H1 2026 during a period of significant regional disruption caused by the conflict between the USA and Iran. Our priority throughout has been the safety of our people.

Speaker #2: We will then open the line for questions. Next slide, please. This is our regular legal disclaimer, and I'll leave you to review it at your leisure.

Speaker #2: The presentation slides are available to view on our website. Next slide, please. Gulf Keystone delivered a resilient operational and financial performance in the first half of 2026.

Speaker #2: During a period of significant regional disruption caused by the conflict between the USA and Iran, our priority throughout has been the safety of our people.

Speaker #2: Despite the challenging circumstances, we are pleased to have extended our track record of zero lost-time incidents to over 3.5 years. Decisive actions to reduce expenditures following the production shutdown enabled us to minimize cash outflow, maintain a robust balance sheet, and pay a $12.5 million dividend to shareholders.

Jon Harris: Despite the challenging circumstances, we are pleased to have extended our track record of zero lost time incidents to over three and a half years. Decisive acts to reduce expenditures following the production shutdown enabled us to minimize cash outflow, maintain a robust balance sheet, and pay a $12.5 million dividend to shareholders. We are pleased to have recently restarted production and exports, with volumes continuing to ramp to prior levels. Looking ahead, we are focused on unlocking full production sharing contract entitlement for export sales at international prices, which could bolster cash flow generation in H2 of the year and support a return to production growth in 2027. Turning now to the operational review. Next slide, please. Production in 2026 year-to-date has been impacted by two precautionary shut-ins related to the regional security environment, totaling almost five months.

Jon Harris: Despite the challenging circumstances, we are pleased to have extended our track record of zero lost time incidents to over 3.5 Years. Decisive acts to reduce expenditures following the production shutdown enabled us to minimize cash outflow, maintain a robust balance sheet, and pay a $12.5 million dividend to shareholders. We are pleased to have recently restarted production and exports, with volumes continuing to ramp to prior levels. Looking ahead, we are focused on unlocking full production sharing contract entitlement for export sales at international prices, which could bolster cash flow generation in H2 of the year and support a return to production growth in 2027. Turning now to the operational review. Next slide, please. Production in 2026 year-to-date has been impacted by two precautionary shut-ins related to the regional security environment, totaling almost five months.

Speaker #2: We are pleased to have recently restarted production and exports, with volumes continuing to ramp up to prior levels. Looking ahead, we are focused on unlocking full Production Sharing Contract entitlement for export sales at international prices.

Speaker #2: This could bolster cash flow generation in the second half of the year and support a return to production growth in 2027. Turning now to the operational review.

Speaker #2: Next slide, please. Production in 2026 year-to-date has been impacted by two precautionary shutdowns related to the regional security environment, totaling almost five months.

Speaker #2: Gross average production in the first half of 2026 was 14,600 barrels of oil per day, compared with 44,100 barrels per day in the first half of 2025, reflecting the shutdown from 28 February to 23 June.

Jon Harris: Gross average production in H1 2026 was 14,600 barrels of oil per day, compared with 44,100 barrels per day in H1 2025, reflecting the shut-in from 28 February to 23 June. Shaikan field and the team on the ground responded exceptionally well to these disruptions. Prior to the first shut-in, production had exceeded 44,000 barrels of oil per day on several days in late February, thanks to the completion of several well workovers. Following the restart on 24 June, the field ramped up quickly to exceed 45,000 barrels of oil per day before the second shut-in on 19 July. On 16 August, we were able to restart production again following the extension of the Tripartite Interim Export Agreement and our view of the regional security environment.

Speaker #2: Shotgun field and the team on the ground responded exceptionally well to these disruptions. Prior to the first shutdown, production had exceeded 44,000 barrels of oil per day on several days in late February, thanks to the completion of several well workovers.

Speaker #2: Following the restart on the 24th of June, the field ramped up quickly to exceed 45,000 barrels of oil per day before the second shutdown on the 19th of July.

Speaker #2: On August 16, we were able to restart production again following the extension of the tri-partite interim export agreements and our view of the regional security environment.

Speaker #2: Gross volumes are currently approaching 40,000 barrels of oil per day, and well activities are underway to increase production to prior levels soon. Our focus for the remainder of 2026 is completing the ongoing ramp-up and maintaining stable export sales, subject to a stable security environment continuing.

Jon Harris: Gross volumes are currently approaching 40,000 barrels of oil per day, and well activities are underway to increase production to prior levels soon. Our focus for the remainder of 2026 is completing the ongoing ramp-up and maintaining stable export sales, subject to the stable security environment continuing. Next slide, please. Investment and activity in H1 2026 has focused on enhancing production and improving safety and reliability of our facilities. Almost half of the USD 80 million net CapEx in the period was spent prior to the shut-in on 28 February. Subsequently, we moved quickly to moderate expenditures and preserve cash. Nonetheless, we have actively continued to progress safety critical and strategic projects during that period, in particular, the installation of water handling facilities at PF-2. We are making good progress and remain on track for full start-up in Q1 2027.

Speaker #2: Next slide, please. Investment and activity in the first half of 2026 has focused on enhanced production and improving the safety and reliability of our facilities.

Speaker #2: Almost half of the $18 million net capex in the period was spent prior to the shutdown on the 28th of February. Subsequently, we moved quickly to moderate expenditures and preserve cash.

Speaker #2: Nonetheless, we have actively continued to progress safety-critical and strategic projects during that period, in particular, the installation of water handling facilities at Pier 2.

Speaker #2: We're making good progress and remain on track for full startup in Q1 2027. Once operational, the project is expected to unlock 4,000 to 8,000 barrels of oil per day of incremental gross production above the baseline, expand total capacity to around 77,000 barrels of oil per day, and reduce reservoir risk.

Jon Harris: Once operational, the project is expected to unlock 4,000 to 8,000 barrels of oil per day of incremental gross production above the baseline, expand total capacity to around 77,000 barrels of oil per day, and reduce reservoir risk. Looking ahead to the remainder of the year, we will continue to further progress the work program provided production remains online. We are also positioning for a return to field development and drilling in 2027 once we have unlocked full production sharing contract entitlement for export sales at international prices. Next slide, please. Despite the disruption to production this year, the Tripartite Interim Export Agreement signed in September 2025 between the IOCs, Kurdistan Regional Government, and Federal Government of Iraq have worked effectively. IOC remuneration has improved relative to local sales, and payments have been consistent without delay following crude liftings.

Speaker #2: Looking ahead to the remainder of the year, we will continue to further progress the work program, provided production remains online. We are also positioning for a return to field development and drilling in 2027.

Speaker #2: Once we have unlocked full Production Sharing Contract entitlement for export sales at international prices. Next slide, please. Despite the disruption to production this year, the tripartite interim export agreements signed on September 25 between the IOCs, Kurdistan Regional Government, and Federal Government of Iraq have worked effectively.

Speaker #2: IOC remuneration has improved, relative to local sales, and payments have been consistent without delay following crude liftings. Realized prices in entitlement invoices have been very robust, with the shotgun discount of rent in the first half of the year at around $9 a barrel.

Jon Harris: Realized prices in entitlement invoices have been very robust, with the Shaikan discount to Brent in H1 of the year at around USD 9 a barrel. The decrease in discount relative to Q4 2025 has been driven by strong demand for Kirkuk blend of crude marketed at Ceyhan from the Iraq-Turkey pipeline. Due to the market disruptions caused by the US-Iran conflict, some cargoes of Kurdistan crude were sold at a net-back price which included a premium to the Kirkuk blend Official Selling Price. We will keep a close eye on how the discount evolves going forward, but it is too early at this stage to provide long-term guidance. In June, the independent consultant's review of IOC invoices and contractual costs were submitted to the government of Iraq. Gulf Keystone and other IOCs are now focused on reconciling export sales since September 2025 to international prices.

Speaker #2: The decrease in discount relative to Q4 2025 has been driven by strong demand for the crude blend marketed at Cheyenne from the Iraq-Turkey pipeline.

Speaker #2: Due to the market disruptions caused by the US-Iran conflict, some cargoes of Kurdistan crude were sold at the net at a net back price, which included a premium to the cook of blend official selling price.

Speaker #2: We will keep a close eye on how the discount evolves going forward, but it is too early at this stage to provide long-term guidance.

Speaker #2: In June, the independent consultants' review of IOC invoices and contractual costs was submitted to the Government of Iraq. Gulf Keystone and other IOCs are now focused on reconciling export sales since September 25 to international prices.

Speaker #2: As you can see from the chart, we have a top-up receivable on our balance sheet of around $80 million, net to Gulf Keystone.

Jon Harris: As you can see from the chart, we have a top-up receivable on our balance sheet of around USD 80 million net to Gulf Keystone. This is estimated value is the differential between cash received to date of USD 30 a barrel and international prices in the entitlement invoices. It remains subject to the implementation of the independent consultant's review. We are seeking to recover the receivable through the commencement of additional liftings in September 2026. The interim exports agreements have also been extended for 6 months to the end of January 2027. This was the final step enabling the recent restart of exports and follows the one-year extension of the Iraq-Turkey pipeline agreement earlier this month. Our focus is now on replacing the interim arrangements with longer-term agreements at international prices. Next slide, please. Shaikan remains a large, long-life asset with significant growth potential.

Speaker #2: This is the estimated value for the differential between cash received to date of $30 a barrel and international prices in the entitlement invoices. It remains subject to the implementation of the independent consultants' review.

Speaker #2: We are seeking to recover the receivable through the commencement of additional shiftings in September 2026. The interim exports agreements have also been extended for six months, to the end of January 2027.

Speaker #2: This was the final step enabling the recent restart of exports and followed by a one-year extension of the Iraq-Turkey pipeline agreement earlier this month.

Speaker #2: Our focus is now on replacing the interim arrangements with longer-term agreements at international prices. Next slide, please. Shaikan remains a large, long-life asset with significant growth potential.

Speaker #2: As of the end of 2025, the Jurassic Reservoir had 416 million barrels of internally estimated gross QP reserves, implying a reserve life of 27 years at 2025's production levels.

Jon Harris: As at the end of 2025, the Jurassic reservoir had 416 million barrels of internally estimated gross 2P reserves, implying a reserve life of 27 years of 2025's production levels. The field also contained 311 million barrels of estimated gross contingent resources, including 157 million barrels in the Triassic reservoir, based on the latest CPR from 2022. Returning to stable exports and payments at international prices will provide the foundation for renewed investment in production growth. In preparation, we are discussing a revised FDP with the Ministry of Natural Resources and positioning for a potential return to field development and drilling in 2027. The draft FDP targets a more than doubling of current production from the Jurassic, a test of the Triassic reservoir up to 10,000 barrels a day, and the elimination of routine gas flaring through a gas management plan.

Speaker #2: The field also contains 311 million barrels of estimated gross contingent resources, including 157 million barrels in the Triassic reservoir, based on the latest CPR from 2022.

Speaker #2: Returning to stable exports and payments for international prices would provide the foundation for renewed investment in production growth. In preparation, we are discussing a revised Field Development Plan with the MNR and positioning for a potential return to field development and drilling in 2027.

Speaker #2: The draft Field Development Plan targets more than doubling current production from the Jurassic, a test of the Triassic reservoir—up to 10,000 barrels a day—and the elimination of routine gas flaring through a gas management plan.

Speaker #2: We will provide further updates as we firm up our plans. With that, I will now hand over to Gabriel for the financial review.

Jon Harris: We will provide further updates as we firm up our plans. With that, I will now hand over to Gabriel for the financial review.

Speaker #3: Thank you, John. We delivered a resilient financial performance in the first half of 2026. By reducing expenditures, we were able to minimize the free cash outflow.

Gabriel Papineau-Legris: Thank you, Jon. We delivered a resilient financial performance in H1 2026. By reducing expenditures, we were able to minimize the free cash outflow, protect our balance sheets, and return cash to shareholders while continuing to progress safety-critical and strategic projects. Next slide, please. Adjusted EBITDA increased 26% to $52 million in H1 2026, compared with $41 million in H1 2025. The increase was driven primarily by considerably higher realized prices reflected in entitlement invoice for export sales as well as lower operating costs. This more than offset the impact of lower production from the temporary shut-in of the Shaikan field. Next slide, please. By taking decisive actions to reduce costs, we have been able to protect our balance sheet through the shut-in while maintaining our ability to quickly restart production at full capacity.

Speaker #3: Protect our balance sheets and return cash to shareholders, while continuing to progress safety-critical and strategic projects. Next slide, please. Adjusted EBITDA increased 26% to $52 million in H1 2026, compared with $41 million in the first half of 2025.

Speaker #3: The increase was driven primarily by considerably higher realized prices reflected in entitlement invoices for export sales, as well as lower operating costs. This more than offset the impact of lower production from the temporary shutdown of the Shaikan field.

Speaker #3: Next slide, please. By taking decisive actions to reduce costs, we have been able to protect our balance sheet through the shutdown, while maintaining our ability to quickly restart production at full capacity.

Speaker #3: Operating costs reduced by 25% to $20 million in the first half of the year relative to H1 2025, while other G&A expenses were 6% lower at $4.3 million.

Gabriel Papineau-Legris: Operating costs reduced by 25% to $20 million in H1 relative to H1 2025, while other G&A expenses were 6% lower at $4.3 million. OpEx per barrel, while elevated over the entire period due to the lower production denominator, was around $4.40 per barrel prior to the February shut-in, in line with prior years. G&A expenses were also down in H1, despite incurring the one-off costs related to the Oslo dual listing. Looking ahead, we remain focused on exercising strict cost control following the recent restarts of production and exports. Next slide, please. The reduction in CapEx and costs during the period enabled us to limit the free cash outflow to $2 million. The working capital outflow primarily reflects the difference between cash received at around $30 per barrel and the international prices reflected in the entitlement invoices.

Speaker #3: OPEX per barrel, while elevated over the entire period due to the lower production denominator, was around $4.40 per barrel prior to the February shutdown, in line with prior years.

Speaker #3: G&A expenses were also down in H1, despite incurring the one-off costs related to the Oslo fuel listing. Looking ahead, we remain focused on exercising strict cost control following the recent restart of production and exports.

Speaker #3: Next slide, please. The reduction in CAPEX and costs during the period enabled us to limit the free cash outflow to $2 million. The working capital outflow primarily reflects the difference between cash received at around $30 per barrel and the international prices reflected in the entitlement invoices.

Speaker #3: As John mentioned, the difference is accrued as a top-up receivable, which increased to around $80 million net to GKP at the end of the period.

Gabriel Papineau-Legris: As Jon mentioned, the difference is accrued as a top-up receivable, which increased to around $80 million net to GKP at the end of the period. To begin recovering the receivable, we are seeking the allocation by State Organization for Marketing of Oil of additional liftings of crude in September 2026, with payments expected no later than 30 days after scheduled cargoes. GKP's net entitlement of Shaikan field sales was approximately 36% in H1 of the year, in line with prior periods. Future net entitlement will depend on realized prices, production levels, and the outcome of the ongoing commercial negotiations with the Ministry of Natural Resources. A return to international prices would quickly defeat the current reported cost pool, incentivizing future investments. Next slide, please.

Speaker #3: To begin recovering the receivable, we are seeking the allocation by SOMO of additional listings of crude in September 2026, with payments expected no later than 30 days after scheduled cargoes.

Speaker #3: GKP's net entitlement of Shaikan field sales was approximately 36% in the first half of the year, in line with prior periods. Future net entitlement will depend on realized prices, production levels, and the outcome of the ongoing commercial negotiations with the Ministry of Natural Resources.

Speaker #3: A return to international prices would quickly defeat the current reported cost goal, incentivizing future investment. Next slide, please. GKP’s robust balance sheet and ability to moderate expenditure enable us to weather disruptions in the first half of the year, while paying a $12.5 million semi-annual dividend in April.

Gabriel Papineau-Legris: GKP's robust balance sheets and ability to moderate expenditure enable us to weather the disruption in H1 of the year while paying a $12.5 million semi-annual dividend in April. We remain committed to returning excess cash to shareholders. We are therefore pleased today to announce an interim semi-annual dividend of $10 million for payment in September 2026. The dividend decision follows a careful consideration by the board of GKP's operating environment, outlook, and cash balance. Achieving full PSC entitlement for export sales could strengthen cash flow generation in H2 of the year, while the company maintains significant flexibility to reduce CapEx and costs if required. As Jon mentioned, export sales at international prices would also support a return to field development and drilling in 2027 as we firm up our plan with the Ministry of Natural Resources.

Speaker #3: We remain committed to returning excess cash to shareholders. We are therefore pleased today to announce an interim semi-annual dividend of $10 million, for payment in September 2026.

Speaker #3: The dividend decision follows a careful consideration by the board of GKP's operating environment, outlook, and cash balance. Achieving full PSE entitlement for export sales could strengthen cash flow generation in the second half of the year, while the company maintains significant flexibility to reduce requirements.

Speaker #3: As John mentioned, export sales at international prices would also support a return to field development and drilling in 2027, as we firm up our plan with the Ministry of Natural Resources.

Speaker #3: Looking ahead, we will remain true to our strategies, balancing disciplined investment in production growth with shareholder distributions and a robust balance sheet. With that, I will hand over to Jon for closing remarks.

Gabriel Papineau-Legris: Looking ahead, we will remain true to our strategies, balancing disciplined investment in production growth while shareholder distributions and a robust balance sheet. With that, I will hand out to Jon for closing remarks.

Speaker #2: Thanks, Gabriel. To summarize, our performance in the first half of 2026 demonstrated the resilience of our business during challenging conditions. By acting quickly and decisively, we've been able to protect our people, our assets, and our balance sheet, while continuing to progress strategic projects and return cash to shareholders.

Jon Harris: Thanks, Gabriel. To summarize, our performance in H1 of 2026 demonstrated the resilience of our business during challenging conditions. By acting quickly and decisively, we have been able to protect our people, our assets, and our balance sheet while continuing to progress strategic projects and returning cash to shareholders. Following the recent restart of production and exports, we are focused on completing the current ramp-up to prior levels and unlocking full production sharing contract entitlement for past and present export sales. Achieving the latter would bolster cash flow generation, supporting our decision today to announce a semi-annual dividend of $10 million and provide the foundations for return to production growth in 2027. As I conclude, I would like to say a big thank you to our staff, shareholders, and wider stakeholders for your continued support. With that, I will now open the line for questions. Thank you.

Speaker #2: Following the recent restart of production and exports, we are focused on completing the current ramp-up to prior levels and unlocking full Production Sharing Contract entitlement for past and present export sales.

Speaker #2: Achieving the latter would bolster cash flow generation, supporting our decision today to announce a semi-annual dividend of $10 million and provide the foundations for returns to production growth in 2027.

Speaker #2: As I conclude, I would like to say a big thank you to our staff, shareholders, and wider stakeholders for your continued support. With that, I will now open the line for questions.

Speaker #2: Thank you.

Speaker #1: Thank you. As a reminder, if you would like to ask a question over the phone, please press star 1 on your telephone keypad. You can also submit written questions via the webcast.

Operator: Thank you. As a reminder, if you would like to ask a question over the phone, please press star one on your telephone keypad. You can also submit written questions via the webcast. We will take our first question from Werner Riding of Peel Hunt. Your line is open. Please go ahead.

Speaker #1: We will take our first question from Vernon Riding of Pearl Hunt. Your line is open, please go ahead.

Speaker #4: Thank you. Morning, guys. Just a question on reserves. You mentioned that your estimate of 2P reserves shows 27 years of productive life, based on last year’s production.

Werner Riding: Thank you. Morning, guys. Just a question on reserves. You mentioned that your estimate of 2P reserves shows 27 years of productive life based on last year's production. When I look at the license expiry, including the two 5-year extensions, the license expires well before this. I am thinking, what would be your thought? Do the revised discussions you are having on the new FDP with the MNR, do they factor in a development period that will allow you to produce all of those reserves? How do those two things marry together?

Speaker #4: When I look at the license diary, and including the two five-year extensions, the license expires well before this. So I'm thinking, well, I'd like to kind of hear your thoughts.

Speaker #4: Do the revised discussions you’re having on the new FTP with the M&R—do they factor in a development period that will allow you to produce all of those reserves?

Speaker #4: How do those two things marry together?

Speaker #2: Vernon, thank you. Thanks for your question. The simple answer is yes. Those are our reserves, and they are the reserves produced within the license period.

Jon Harris: Werner, thank you. Thanks for your question. The simple answer is yes. Those are our reserves, and they are the reserves produced within the license period. Essentially, I think during the presentation, I mentioned that we were looking to ramp up production to some 85,000 barrels a day, which is nearly double what we are producing now. Clearly that would shorten the 27 years life based on last year's production considerably. Not quite sure it halves it, but nearly, basically. Yes, they are the reserves. They are produced within the period, and it does assume a production ramp-up.

Speaker #2: Essentially, I think during the presentation I mentioned that we were looking to ramp up production to some 85,000 barrels a day, which is nearly double what we're producing now.

Speaker #2: So, clearly, that would shorten the 27 years' life based on last year's production considerably. Not quite sure it halves it, but nearly, basically. So yes, they are the reserves.

Speaker #2: They are produced within the period, and it does assume a production ramp-up.

Speaker #4: Okay. And so, with the revised FTP, it's possible that we'll see an extended license period as well, to kind of enable you to do that?

Werner Riding: Okay. With the revised FDP, it is possible that we will see an extended license period as well to enable you to do that?

Jon Harris: That is not part of the Field Development Plan at the moment. Of course, it might become part of future negotiations.

Speaker #2: We are not—that's not part of the field development plan at the moment. Of course, it might become part of future negotiations.

Speaker #4: Okay, all right. Thank you. Maybe one for Gabriel. Just wondering how much of the H1 operating cost reduction reflects the temporary shutdown versus, I guess, more sustainable structural efficiencies?

Werner Riding: Okay. All right. Thank you. Maybe one for Gabriel. Just wondering how much of the H1 operating cost reduction reflects the temporary shut-in versus, I guess, more sustainable structural efficiencies?

Gabriel Papineau-Legris: Yeah.

Werner Riding: Just because you were producing less.

Speaker #4: Because you were producing less, and it would.

Gabriel Papineau-Legris: Exactly. I would say the majority is related to the fact that we were shut in, so we were spending less on diesel, on chemicals. Obviously, we had to implement some other staff-related savings. But as you can see in the first 2 months, we were bang in line with historical cost, and we always look for opportunities to find savings that can carry on. But for the first half, specifically, given the high level of production going now, it is primarily related to the shut-in.

Speaker #2: Exactly. So I would say the majority is related to the fact that we were shut down. So we were spending less on diesel, on chemicals, and obviously, we had to implement some other staff-related savings.

Speaker #2: But as you can see in the first half, in the first two months, we were bang in line with historical costs, and we always look for opportunities to find savings that can carry on.

Speaker #2: But for the first half specifically, given the high level of production going down, it's primarily related to the shutdown.

Speaker #4: Yeah. Okay. Thank you.

Werner Riding: Yeah. Okay. Thank you.

Speaker #1: Our next question comes from Theodore Nelson from SB1 Market. Your line is open. Please go ahead.

Operator: Our next question comes from Teodor Sveen-Nilsen from SB1 Markets. Your line is open. Please go ahead.

Speaker #5: Good morning, guys. Thanks for taking my questions. A few questions from me—first, on the ongoing ramp-up you discussed. You indicated you aim to increase production back to the pre-shutdown level of around 40,000 barrels per day.

Teodor Sveen-Nilsen: Good morning, guys, and thanks for taking my questions. A few questions for me. First, on the ongoing ramp-up you discussed. You indicated you aim to increase production back to the pre-shutdown level of around 40,000 barrels per day. How should we think, when will we reach that level, and what should we expect? Production for the H2, assuming that there won't be any more shutdowns. Second question, that is on reserves. How could you think around any potential impact of the reserves because of the production shut down and then production restart and then shut down again? Will there be any impact at all? Final question, that is on the receivables. I understand it's difficult to precisely answer it, but how should we think about the repayment profile, and how much do you think should be recovered this year? Thanks.

Speaker #5: So, how do you think—when will we reach that level, and what should we expect? Production for the second half—I assume that there won't be any more shutdowns.

Speaker #5: Second question there is on reserves. How do you think about any potential impact on the reserves because of the production shutdown, then the production restart, and then shutdown again?

Speaker #5: Will there be any impact at all? And final question, that's on the receivables. I understand it's difficult to precisely answer, but how do you think about the repayment profile, and how much do you think could be recovered this year?

Speaker #5: Thanks.

Speaker #2: Brian, okay. I think your first question was around how quickly do we get back up to previous levels. I think we said during the sort of production ramp back in June through to July, which is like the 23rd of June to the middle of July.

Jon Harris: Right. Okay. I think your first question was around how quickly do we get back up to previous levels? I think I said during the production ramp back in June through to July, which was the 23 June to the middle of July, so that was 3 weeks, we got to 45,000. We've just started on the 16 August, that we've restarted production. Here we are not even 10 days into that. Coiled tubing is in the field lifting wells. As we speak, I'd expect to be over 40,000 by tomorrow in terms of production run rate. It's really about 3 weeks since we started, so I'd expect us to be back close to 44,000, 45,000. That's when the production ramps up. I hope that answers that question.

Speaker #2: So that was like three weeks, we got to 45,000. We've just started on the 16th of August—a restart of production. So here we are, not even 10 days into that.

Speaker #2: Core tubing is in the field lifting wells. As we speak, we might expect to be over 40,000 by tomorrow in terms of production run rate.

Speaker #2: And it's really about three weeks since we started. So, I'd expect us to be back close to 44,000–45,000. That's on the production ramp side.

Speaker #2: So, I hope that answers that question. You said, with the production shutdown, and start and shutdown again, do you expect the reserves to be affected?

Jon Harris: You said with the production shutdown and start and shutdown again, do you expect the reserves to be affected? I mean, the numbers we are talking about, I would not expect those to really materially affect the overall reserves position, because we will be producing a much higher rate. The fact that we have not been producing, that obviously plays into how we produce in the future. No, I do not expect the reserves to be affected materially by that.

Speaker #2: I mean, the numbers we’re talking about—I wouldn’t expect those to really, materially affect the overall reserves position, because we’ll be producing at a much higher rate. And the fact that we haven’t been producing, that kind of obviously plays into how we produce in the future.

Speaker #2: But I don't expect the reserves to be affected materially by that.

Speaker #3: Yeah, and I think from what you've seen in the activity on the field, it hasn't. As we ramp up the wells, they've all come back, and there haven't been any issues.

Gabriel Papineau-Legris: Yeah, I think what you have seen in the activity on the field, it has not, as we ramp up the wells, they have all come back and there has not been any issues. So that is from a mechanical or subsurface perspective. So that is positive. On your point on the receivable, basically we are really focused at the moment dealing with Q4 2025. That is following the submission of the independent consultant's review, and we are working quite hard with the other IOCs and the Ministry of Natural Resources at the moment to get some cargoes allocated from September. So we will have to see. We also need to recognize that in the summers, the volume, the throughput of oil, going through has been impaired by the security concerns, the fact that us and other fields have been limited. That impairs, I suspect a little bit at the ability for a quick handover of additional cargoes.

Speaker #3: So that's from a mechanical or subsurface perspective, so that's positive. And on your point on the receivable, basically we're really focused at the moment on dealing with the Q4 2025.

Speaker #3: That is following the submission of the independent consultant's review, and we're working quite hard with the other IOCs and the M&R and so on to get some cargoes allocated from September.

Speaker #3: So we'll have to see. We also need to recognize that in the summers, the volumes—the throughput of oil going through—has been kind of impaired by the security concerns.

Gabriel Papineau-Legris: So we will have to see. We also need to recognize that in the summers, the volume, the throughput of oil, going through has been impaired by the security concerns, the fact that us and other fields have been limited. That impairs, I suspect a little bit at the ability for a quick handover of additional cargoes.

Speaker #3: The fact that us and others have been limited, that impairs, I suspect, a little bit the ability for a quick handover of additional cargoes.

Speaker #3: But now that we are back online, production is ramping up. We hope that we're going to be able to see some of that cargo coming up soon.

Gabriel Papineau-Legris: But now that we are back online, production is ramping up. We hope that we are going to be able to see some of those cargo coming up soon. The priority is really get that first cargo, get Q4 over the line, and then basically then you start a program to deal with the H1 of this year. As Jon mentioned, production, the first part of this year was essentially January, February for the large part. So we would expect it should be also relatively quick to get the top-up for that period at an elevated oil price that we are seeing at the moment. But let us focus on Q4. That is the priority right now, and we will then move ourselves to Q1 after that.

Speaker #3: And the priority is really to get that first cargo, get Q4 over the line, and then basically start a program to deal with the first half of this year.

Speaker #3: And as Jon mentioned, production for the first part of this year was essentially January–February for the large part. So we'd expect it should also be relatively quick to get the top-up for that period.

Speaker #3: At an elevated oil price that we're seeing at the moment. But let's focus on Q4—that's the priority right now—and we'll then move ourselves to Q1 after that.

Speaker #5: Okay, understood. And one final question, if I may. That is on CAPEX. Given the accelerated production in the second half, should we also expect you to spend more in the second half than in the first half?

Teodor Sveen-Nilsen: Okay. Understood. One final question, if I may. That is on CapEx. Given accelerated production in H2, should we also expect you to spend more in H2 than in H1?

Gabriel Papineau-Legris: At the moment, it is a little bit too early to tell if it is just. I don't think we could say it is going to be double. You still have some discretionary spend that we can put forward in order to prep for next year's activities. But that's also tied with international pricing and the recovery of cash flows. That's why we didn't reinstate guidance. But for example, on strategic projects like the wet train and the shutdown and some of the things that we had decided to carry on, regardless or not of the production shut-in, those are carrying on. But some well activities and planning for next year's activities like long leads and stuff like that are more discretionary, and we will navigate those as we go through the remainder of this quarter and Q4.

Speaker #3: At the moment, it's a little bit too early to tell. I don't think we could say it's going to be double.

Speaker #3: You still have some discretionary spend that we can put forward in order to kind of prep for next year's activities. But that's also kind of tied with international pricing and the recovery of cash flows.

Speaker #3: So that's why we didn't reinstate guidance. But, for example, on strategic projects like the wet terrain and the shutdown, and some of the things that we had decided to carry on regardless of the production shut-in, those are carrying on.

Speaker #3: But some well activities and planning for next year's activities, like long leads and stuff like that, are more discretionary, and we will navigate those as we go through the remainder of this quarter and Q4.

Speaker #5: Okay, understood. Thank you. That's all from me.

Teodor Sveen-Nilsen: Okay, understood. Thank you. That's all from me.

Speaker #2: Thank you.

Gabriel Papineau-Legris: Thank you.

Speaker #1: Our next question comes from Charles Sharp from Canaccord. Your line is open. Please go ahead.

Operator: Our next question comes from Charles Shrout from Canaccord. Your line is open. Please go ahead.

Speaker #6: Thank you very much for taking my question. A couple of questions, actually, if I may. In terms of the recovery of the Q4 true-up, do you think you need to have agreement on the full export pricing before you get that, perhaps with the September lifting?

Charlie Sharp: Thank you very much for taking my question. A couple of questions actually, if I may. In terms of the recovery of the Q4 true up, do you think you need to have agreement on the full export pricing before you get that perhaps September lifting? Has that Q4 receivable for the true up been agreed with the various authorities?

Speaker #6: And has that Q4 receivable for the true-up been agreed with the various authorities?

Speaker #2: So, basically, the Q4 receivable was part of the independent consultant's review. And so, now that that number has been validated, it's now moving to allocation of additional cargoes to turn those receivables into money.

Gabriel Papineau-Legris: Basically, the Q4 receivable was part of the independent consultant's review. Now that that number has been validated, it is now moving to allocation of additional cargoes to turn those receivables into money. There is also a longer-term element to discuss about future production, long-term prices to ensure that we move away from that interim period to get future production. We are also in parallel having conversation with the different stakeholders to put in place long-term exports agreements, which would allow us to get international prices right from the beginning. I see those as being disconnected. You could still recover the receivables from the Q4, in advance of agreeing long-term agreements related to ongoing production.

Speaker #2: But there is also a longer-term element to discuss about future production—long-term prices to ensure that we move away from that interim period to get future production.

Speaker #2: So we're also, in parallel, having conversations with the different stakeholders to put in place long-term export agreements, which would allow us to get international prices right from the beginning.

Speaker #2: But I see those as being disconnected. You could still recover the receivables from Q4 in advance of agreeing to long-term agreements related to ongoing production.

Speaker #6: Okay, that's great. Thank you. And one short follow-up: you talk about maybe a return to growth next year, and drilling next year. Do you have in mind a possible timetable for that drilling?

Charlie Sharp: Okay, that is great. Thank you. One short follow-up. You talk about maybe a return to growth next year, and drilling next year. Do you have in mind a possible timetable for that drilling? Would that need, in your mind, to have agreement on the FDP or approval of the FDP?

Speaker #6: And would that need, in your mind, to have agreement on the FDP, or approval of the FDP?

Jon Harris: Charlie, we are out tendering at the moment for a rig. Obviously, there will be also some long leads which will dictate the exact start date, which we have not got the answer to. Our expectation is H2 next year. Yes, we would like to have the full development plan agreed. We might consider drilling without it, but I think our very strong preference is we are driving towards agreeing a field development plan.

Speaker #2: I mean, Charlie, we're out tendering at the moment for a reorganization. Obviously, there will also be some long lead items, which will dictate the exact start date, which we haven't got the answer to.

Speaker #2: Our expectation is the second half of next year. And yes, we would like to have the field development plan agreed, but we might consider drilling without it.

Speaker #2: But I think our very strong preferences are driving us towards agreeing with the field development plan.

Speaker #6: That's great. Thank you.

Charlie Sharp: That's great. Thank you.

Speaker #2: Thank you.

Jon Harris: Thank you.

Speaker #1: As a reminder, if you would like to ask a question over the phone lines, please press *R1* on your telephone keypad. Our next question comes from David Round from Stafford.

Operator: As a reminder, if you would like to ask a question over the phone lines, please press star 1 on your telephone keypad. Our next question comes from David Round from Stifel. Please go ahead.

Speaker #1: Please go ahead.

Speaker #6: Great. Morning, guys. Just firstly on the draft FDP—obviously, that's been around a while. I was interested in whether it's changed much in recent years, thinking particularly around the gas management system, or whether you've just sort of dusted off the old one.

David Round: Great. Morning, guys. Just firstly on the draft FDP, obviously, that's been around a while. I was interested whether it's changed much in recent years, thinking particularly around the gas management system or whether you've just sort of dusted off the old one. I think, correct me if I'm wrong, the last number I saw was sort of USD 800 million to USD 925 million for that next phase. So does that still stand? Are you able to break that down for us at all and how you think about funding it?

Speaker #6: And I think—I mean, correct me if I'm wrong—the last number I saw was sort of $800 to $925 million for that next phase.

Speaker #6: So does that still stand? Are you able to break that down for us at all? And how are you thinking about funding it?

Jon Harris: Based on the FDP in terms of development planning, in terms of expanding capacity, both in the facilities and from wealth perspective is similar. We have a few more wells than we had previously towards the back end of the program, so we have a continuous drilling program. The gas management plan, we are considering a number of alternatives. One is as per the original plan, which was to reinject all of the gas that is not needed for use in the plant. The second one is to just reinject the acid gas into a deeper reservoir and produce the sweet gas and make that available for sales. So that is the difference, and we have not concluded on that yet, but we are sort of honing in on those two solutions to the gas side of things. I think the next question was around

Speaker #2: So, based on the FDP, in terms of development planning and in terms of expanding capacity—both in the facilities and from a wells perspective—it is similar.

Speaker #2: We have a few more wells than we had previously, towards the back end of the program, so we'd have a continuous drilling program. The gas management plan—we are considering a number of alternatives. One is as per the original plan, which was to reinject all of the gas that is not needed for use in the plant.

Speaker #2: The second one is to just re-inject the acid gas into a deeper reservoir, and produce the sweet gas and make that available for sales.

Speaker #2: So, that's the difference. We haven't kind of concluded on that yet, but we are sort of honing in on those two solutions to the gas side of things.

Speaker #2: I think the next question was around the gas side of things.

Gabriel Papineau-Legris: On the CapEx.

Jon Harris: CapEx. Thanks.

Speaker #3: Yeah. So to account for those additional wells, which come later in the life of the asset, as well as the gas management program, we haven't yet come out publicly for what those will come in at, because we still need to go to the tendering of the gas project.

Gabriel Papineau-Legris: To account for those additional wells which come later in the life of the asset, as well as the gas management program, we have not come yet, obviously, for where those come in, because we still need to go to the tendering of the gas project. But I think the estimate that you said at a starting point on a gross basis, we would probably expect to see this going a little bit higher up because there would be more wells in the back end. And we would have to see how ultimately the costs come from the gas management. The one thing worth noting is that the cost pool has been mostly depleted since, if you move back 2022, 2023, just before the shut in of the ITP and moving to local sales. So essentially the recycling of the CapEx is going to be a much shorter balance.

Speaker #3: But I think the estimate that you said at a starting point, on the growth basis, we'd probably expect to see this going a little bit higher, because there would be more wells in the back end.

Speaker #3: And we'd have to see how, ultimately, the costs come from the gas management. The one thing worth noting is that the cost pool has been mostly depleted since, if you move back from 2020 to 2023, just before the shut-in of the ITP and moving to local sales.

Speaker #3: So, it's actually the recycling of the CapEx that is going to be a much shorter balance. That being said, we think that the capital generation of the asset will be improved.

Gabriel Papineau-Legris: And that being said, we think that the cash flow generation of the asset will be improved. But as well, we talked even back in the days to raise some debt. We know that the high-yield market has been quite supportive of Kurdistan Fair over the years. And depending essentially how the gas management program turns around, there could be some other providers of capital. But we are looking into this as we speak to make sure that we are well-funded and our pace of investment ties with the robust balance sheets and ensuring that our shareholders are seeing some distribution as we pace the investment over time. So once we get the FDP over the line, we will be in a much better place to come with the full story to investors.

Speaker #3: But as well, we talked even back in the day about raising some debt. We know that the high-yield market has been quite supportive of the recent effort over the years.

Speaker #3: And it's ending exactly how the gas management program turns around. There could be some other providers of capital, but we're looking into this as we speak to make sure that we're well funded and that our pace of investment aligns with a robust balance sheet, ensuring that our shareholders are seeing some distribution as we phase the investment over time.

Speaker #3: So, once we get the FDP over the line, we'll be in a much better place to come with the full story to investors.

Speaker #6: Okay, great. And can I just sneak in a follow-up, please? Just on the discounts: the numbers you show on slide 7—are they a discount for the Kurdistan blend, or are they specific Shaikan discounts?

David Round: Okay, great. And can I just sneak in a follow-up, please? Just on the discount. The numbers you show on slide 7, are they a discount for the Kurdistan blend or are they specific Shaikan discounts? And can I ask just what you are assuming going forward in your own estimate?

Speaker #6: And can I ask just what you're assuming going forward in your own estimate?

Speaker #3: Yeah, to clarify, this is really related to Shaikan. So, it takes into account the quality as well as the transportation, the length of the pipeline we use.

Gabriel Papineau-Legris: Yeah. So to clarify, this is really related to Shaikan. So it takes into account the quality as well as the transportation, the length of the pipeline we use. As Jon said, it is a little bit too early to call that 9% will be forever. But I suspect it is going to be low double digits, I think, going forward. And we are looking forward to see how that is going to evolve. But if you look back compared to the USD 23, 25 or even USD 27 per barrel that we saw before, this is a net material improvement from where we are. So we are really pleased to have those agreements in place with those reduced discounts.

Speaker #3: As Jon said, it's a little bit too early to call that 9% will be forever. But in my view, I suspect it's going to be low single-digit to double-digit.

Speaker #3: I think, going forward, we are looking forward to seeing how that's going to evolve. But if you look back compared to the $23, $25, or even $27 per barrel that we saw before, this is a net material improvement from where we are.

Speaker #3: So we're really pleased to have those agreements in place with this reduced discount.

Speaker #6: Okay. Great. Very clear. Thanks.

David Round: Okay, great. Very clear. Thanks.

Aaron Clark: Yep.

David Round: Yep.

Speaker #1: Thank you. That appears to be all the questions from the phone line. So, I'd like to now hand over for web request questions.

Operator: Thank you. That appears to be all the questions from the phone line, so I would like to now hand over for webcast questions.

Speaker #2: Thanks, Danielle. Thanks, everyone, for submitting your questions. The first question from investors is: What is management doing to unlock the value of the assets, given that the stock is undervalued and has underperformed over the last few years compared to industry peers?

Aaron Clark: Thanks, Danielle. Thanks everyone for submitting your questions. First question from investors is: What is management doing to unlock the value of the assets, as the stock is undervalued and has underperformed over the last few years against industry peers? Jon, maybe I can pass that to you.

Speaker #2: John, maybe I can pass that to you.

Speaker #4: Okay, great. Thank you. Well, I would say we've outperformed many of our international peers over the past three years, on a total shareholder return basis.

Jon Harris: Well, I would say we have outperformed many of our international peers over the past three years on a total shareholder return basis, accounting for dividends. I recognize that nonetheless, I agree that there has been an impact on our share price this year due to the deterioration of the regional security environment and our prudent response to shutting production, while many other peers have benefited from ongoing sales of course, at international prices, at the inflated international oil price. Now that we are back into production and seeking to get back to international prices, with targeted recovery of the top-up receivable for the actual production we had produced during this period, we expect our performance to very much recover. This would enable us to drive production growth from the Shaikan field, which we believe would unlock significant value for shareholders.

Speaker #4: Counting for dividends, I recognize that. Nonetheless, I agree that there's been an impact on our share price this year due to the deterioration of the regional security environment.

Speaker #4: And our prudent response to shutting production, while many other peers have benefited from ongoing sales across the international market at the inflated international oil price.

Speaker #4: Now that we're back into production, I'm seeking to get back to international prices, with targeted recovery of the top-up receivable for the actual production we had during this period.

Speaker #4: We expect our performance to recover significantly. This would enable us to drive production growth from the Shaikan field, which we believe would unlock significant value for shareholders.

Speaker #2: Thanks, John. The second question has actually been a few questions on the overdue receivables between 2022 and 2023. What's the update on those receivables?

Aaron Clark: Thanks, Jon. The second question on there has actually been a few questions on the overdue receivables between 2022 to 2023. What is the update on those receivables, and is there a resolution forthcoming anytime soon? Gabriel?

Speaker #2: And is there a resolution course coming anytime soon, Gabriel?

Speaker #5: Yep.

Gabriel Papineau-Legris: Yep. Thanks, Aaron. The recovery of those historical receivables, including 2023 and 2022, is part of the ongoing discussion with the Ministry of Natural Resources as part of the other outstanding Shaikan commercial matters. The talks are progressing regarding the timing and form of the potential settlements of all the historical receivable. What I am happy to point is that, as you can see in our account in note 12, we are actually effectively continuing to recover the cost oil portion of some of those 2022 and 2023 arrears. That balance has been going down since the back end of last year. It is positive and de-risks that position.

Speaker #3: Thanks, Aaron. So the recovery of those historical receivables, including '23 and '22, is part of the ongoing discussion with the M&R as part of the other outstanding Shaikan commercial matters.

Speaker #3: The talks are progressing, and regarding the timing and the form of the potential settlements of all the historical receivables, what I'm happy to point to is that, as you can see in our accounts in Note 12, we are actually effectively continuing to recover the costs, or a portion of some of those 2022 and 2023 arrears.

Speaker #3: So that balance has been going down since the back end of last year, so it's positive and de-risks that position.

Speaker #2: Great. So next question is just on M&A. Do you envisage opportunities to merge or diversify the asset base, and therefore enhance revenue streams, in the next 12 months?

Aaron Clark: Great. The next question is just on M&A. Do you envisage opportunities to merge or diversify the asset base and therefore enhance revenue streams in the next 12 months? Jon, would you like to take that?

Speaker #2: John, would you like to take that?

Speaker #4: Thank you. Yes, our primary focus remains unlocking the full Production Sharing Contract entitlement from export sales and returning to disciplined investment in production growth from the Shaikan field.

Jon Harris: Thank you. Our primary focus remains unlocking the full production sharing contract entitlement from export sales and returning to disciplined investment in production growth from the Shaikan field. Of course, we also look at opportunities to grow production and diversify our portfolio inorganically that will be value accretive and consistent with our current financial profile.

Speaker #4: But of course, we also look at opportunities to grow production and diversify our portfolio inorganically, that would be value-accretive and consistent with our current financial profile.

Speaker #2: Great, a few here on the top-up. I think Gabriel's covered that quite extensively, but there's one here just regarding the September liftings that we talked about.

Aaron Clark: Great. A few here on the top-up. I think Gabriel has covered that quite extensively, but there is one here just regarding the September liftings that we talked about. Are you now supposed to receive international oil prices for those liftings, or is it still the interim deal with local prices with a potentially later top-up?

Speaker #2: Are you now supposed to receive international oil prices for those liftings, or is it still the interim deal with local prices, with a potentially later top-up?

Speaker #3: Yeah, so the way it works is that there's a dollar amount of receivables owed to the IOCs, and basically, they take the international pricing, and you kind of divide that amount at that point in time. It determines the number of barrels.

Gabriel Papineau-Legris: Yeah. The way it works is that there is a dollar amount of receivables owed to the IOCs, and basically they take the international pricing, you divide that amount at that point in time, it determines the number of barrels. The IOCs are allocated some barrels. We sell those barrels, and as this is converted back to cash, we are able to complete our receivables. The short answer is yes, it would be on international pricing.

Speaker #3: So, then the IOCs are allocated some barrels. We sell those barrels, and as this is converted back to cash, we're able to deplete our receivables.

Speaker #3: So the short answer is yes, it would be based on international pricing.

Speaker #2: Great. Next question is just on the CPR. The last CPR was from 2022. When will there be a new CPR? John?

Aaron Clark: Great. Next question is just on the CPR. The last CPR was from 2022. When will there be a new CPR, Jon?

Speaker #4: Yeah. I mean, with us progressing to a field development plan, agreed with the Ministry of Natural Resources, we would move quite swiftly to also reinvigorate the last CPR.

Jon Harris: Yeah. With us progressing to a Field Development Plan, agreed with the Ministry of Natural Resources, we would move quite swiftly to also reinvigorate the last CPR. But one thing I would say is the field has continued to perform as expected. It has continued to produce as we thought it would. It has been very reliable. From that perspective, that is why it is quite easy to say our reserves have not changed significantly, albeit obviously we are still looking at doing a major development to liberate those reserves. But it is behaving predictably, so it gives us confidence to state the numbers having not done a CPR since 2022.

Speaker #4: But I mean, one thing I would say is just the field has continued to perform as expected. It's continued to produce as we thought it would; it's been very, very reliable.

Speaker #4: From that perspective, that's why it's quite easy to say our reserves haven't changed significantly. Albeit, obviously, we're still looking at doing a major development to liberate those reserves.

Speaker #4: But it is behaving predictably, so it gives us confidence to state the numbers. I mean, not going into a CPR since ’22. Thanks.

Aaron Clark: Thanks. Great. Just for you, Jon, again, can you elaborate on how the security situation has changed in such a way that you have decided to restart production?

Speaker #2: Great. And just for you, Jon—again, can you elaborate on how the security situation has changed in such a way that you've decided to restart production?

Speaker #4: Yeah, very much. So we continue to look at what's been going on. Obviously, between the US and Iran, and we've kind of continued to see that there was a build-up in military hardware by the US.

Jon Harris: Yeah, very much so. We continue to look at what's been going on, obviously between the US and Iran. We've kind of continued to see that there was a buildup in military hardware by the US, kind of up until about 10 days, 2 weeks ago. Then the US has kind of backed off going full tilt militarily, and continued with its rhetoric about going full tilt, but it hasn't done it. That's connected with the kind of the conversations around having sufficient Patriot missiles and other interceptors of drones and ballistic missiles, having a reduced number of those in the region, and therefore wanting to potentially move to a negotiated solution. Then obviously you'll have heard recently

Speaker #4: Kind of up until about 10 days, maybe two weeks ago, and then the US has kind of backed off going full tilt militarily, but continued with its rhetoric about going full tilt.

Speaker #4: But it hasn't done it. Plus, connected with the conversations around having sufficient Patriot missiles and other interceptors for drones and ballistic missiles, there's a reduced number of those.

Speaker #4: In the region, and therefore wanting to potentially go move to a negotiated solution. And then, obviously, you'll have heard recently—yesterday—the Secretary of State of the US has come out, the Secretary of State, but Blinken's come out and said that they're going to go full tilt on trying to bring them around to the negotiating table through economic hardship means.

Jon Harris: Yesterday, the Secretary of State of the US has come out. Well, not the Secretary of State, but the president has come out and said that they're going to go full tilt on trying to bring Iran to the negotiating table through economic hardship means. From our perspective, we've seen, obviously, the militia who are Shia militia sponsored by Iran, have been largely responsible for most of the ordnance fired into Kurdistan. Certainly, some has come from Iran, but the vast majority has been fired by the militia. We've seen the militia basically in negotiations with the Iraqi government about political power, but also getting to a place where they have backed off military activity as well.

Speaker #4: So from our perspective, we've seen, obviously, the militia who are Shia and the militia sponsored by Iran have been largely responsible for most of the ordnance fired into Kurdistan.

Speaker #4: Certainly, some have come from Iran, but the vast majority has been fired by the militia. And we've seen the militia basically in negotiations with the Iraqi government about political power, but also kind of getting to a place where they have backed off military activity as well, whilst people are talking about the US leaving Iraq.

Jon Harris: Whilst people are talking about the US leaving Iraq, also connected with the new Prime Minister of Iraq saying that he's expecting the militia to disarm, albeit there are rumblings about the timing of that and how that's going to be affected. Our overall assessment is that we've seen less hostilities towards Kurdistan, less hostilities towards IOCs, not for a considerable period of time, actually. Therefore, that's led us to go back to being able to produce. But we're going to continue to monitor the situation, and of course, it may deteriorate again, in which case we might have to shut in, but our hope is that we can continue to produce. Great. Thank you, Jon. I don't have any further questions from the webcast, so I will hand back to the operator to close the call.

Speaker #4: Also, connected with the new Prime Minister of Iraq saying that he's expecting the militia to disarm, albeit there are rumblings about the timing of that and how that's going to be affected.

Speaker #4: So our overall assessment is that we've seen less hostilities towards Kurdistan, less hostilities towards IOCs—not for a considerable period of time, actually. And therefore, that's led us to go back to being able to produce. But we're going to continue to monitor the situation, and of course, it may deteriorate again.

Speaker #4: In which case, we might have to shut in. But our hope is that we can continue to produce.

Speaker #2: Great. Thank you, John. I don't have any further questions from the webcast, so I will hand back to the operator to close the call.

Aaron Clark: Great. Thank you, Jon. I don't have any further questions from the webcast, so I will hand back to the operator to close the call.

Operator: Thank you. That concludes today's presentation and Q&A. You may now disconnect.

Aaron Clark: Okay.

Jon Harris: Okay.

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