August 6, 2019 / 6:44 AM / 3 months ago

UPDATE 1-Genel Energy confident on Bina Bawi talks with Kurdish authorities

* Genel to pay $14 mln, 5c/shr interim dividend

* Genel “increasingly confident” on Bina Bawi (Adds detail)

LONDON, Aug 6 (Reuters) - Iraqi Kurdistan-focused Genel Energy said it is confident it is making progress on its Bina Bawi gas project as it holds talks with the Kurdistan Regional Government (KRG) over exact terms.

It wrote down $424 million at the Miran field in March amid slow progress on Bina Bawi, which will be developed first.

Genel wants to use money from oil output at Bina Bawi to fund a phased development for full-scale gas production.

“Commercial discussions continue on Bina Bawi, and we are increasingly confident of making sufficient progress to enable work on the ground to begin next year, with the potential for Bina Bawi oil to also add to our production in 2020,” it said.

“Genel and the KRG are now aligned on a phase one upstream project scope delivering a reduced c. 250 million standard cubic feet a day raw gas. The KRG and Genel will jointly fund the midstream gas development required to process the raw gas.”

Genel said it would pay an interim dividend of $0.05 per share, amounting to $14 million, as part of its pledge to pay out at least $40 million a year. Earlier this year it paid out $0.10 a share, amounting to $27.9 million.

Genel, which is also looking for acquisitions to add near-term production in or outside of Iraq, had $390 million of cash as of Aug. 5, it said.

Genel has upped its free cash flow guidance for this year to in excess of $100 million at an oil price of $45 a barrel. It previously put the measure at $100 million. (Reporting by Shadia Nasralla, editing by Louise Heavens)

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