Presentation

Genel Energy is an independent E&P company focused on the Kurdistan Region of Iraq (KRI), where the company has been active since 2002. Genel is listed on the London Stock Exchange with a market capitalization of about USD 450m. The company had a net cash position of USD 57m.

Genel’s most important asset is the Tawke PSC (25% WI), where we expect the successful Peshkabir field to keep gross production above 100,000 bpd in 2020e. This is expected to enable the company to produce ~26,000 bpd net of oil in 2020e with a low opex of less than USD 3/boe, and a 10% higher exit rate driven by the Sarta development. The Sarta field is expected to commence production by YE’20 and we estimate that it will lift Genel’s net production above 30,000/bpd.

We estimate that Genel has about 160 mill barrels of net recoverable resources at the Tawke (incl. Peshkabir) and Taq Taq oil fields while the Miran and Bina Bawi natural gas fields hold in excess of 2bn boe of primarily gas resources. At P/NAV 0.6x (Brent USD 50/bbl long-term), we believe the market underestimates the robustness of Genel’s business and think the company is an attractive play on higher oil prices.