Gulf Keystone Petroleum Limited has reported a full-year pretax loss of $29.5 million.

“2007 was a year of significant challenges for Gulf Keystone Petroleum from which I believe the Company has emerged both operationally and strategically stronger.  Entering into two production sharing contracts in Kurdistan, entitlement to production from the GKN-1 oil field and continuing exploration activity in Algeria has ensured the shape of Gulf Keystone, and as such our future prospects, has improved considerably over the past year,” said Chairman and Chief Executive Officer Todd Kozel.

The oil-and-gas exploration company, which operates in Algeria and Kurdistan, reported a profit of $46.4 million a year earlier, it said in a statement.

The loss follows a charge of $20.6 million as a result of an impairment test on Block 126a, following the failure to find commercial levels of hydrocarbons in GRJ. Its revenue came in at $5.4 million, it added..

Gulf Keystone Petroleum said it expects development at Block 126, in the south east Constantine basin, North Algeria, to be self-financing, adding the work programme on the HBH Permit in

Algeria is progressing at a steady pace. The company said it expects to drill an exploration well on the Shaikan Block in the Kurdish Region of Iraq soon.