Kurdistan Operational Update

RNS Number : 5083P

Gulf Keystone Petroleum Ltd

19 July 2010

 



Not for release, publication or distribution in or into the United States or jurisdictions other than the United Kingdom and Bermuda where to do so would constitute a contravention of the relevant laws of such jurisdiction.

19 July 2010

Gulf Keystone Petroleum Ltd. (AIM: GKP)

("Gulf Keystone" or "the Company")

Kurdistan Operational Update:

Extended Shaikan-1 Well Test, First Production and Sheikh Adi-1 Exploration Well

Gulf Keystone announces the arrival of the initial loads of production facility equipment to the Shaikan field location and the commencement of the rig move by the AOS Discover-1 drilling rig to the Sheikh Adi-1 exploration well site.

The first pre-packaged production equipment units have arrived at the production facility construction site near the Shaikan-1 well location.  This equipment together with the oil storage tanks and truck loading facility will form the basis of an 18,000 bopd capacity oil production treating and truck loading facility. 

This facility will be used during the long term production testing of the Sargelu (upper Jurassic) oil reservoir in the Shaikan-1 discovery well (reference 12 July 2010 announcement with respect to workover rig operations).  Production testing will last for at least 18 to 24 months and accumulate valuable data related to reservoir characteristics and oil recovery factors.  The test volumes (estimated at 8,000 to 10,000 bopd) will generate Gulf Keystone's first oil production revenue in Kurdistan.

In addition, the AOS Discoverer-1 drilling rig has arrived at the Sheikh Adi-1 well site and rig up is 10% complete.  This well will be Gulf Keystone's first exploration well on the Sheikh Adi block in which the Company has an 80% working interest.  The well is planned to spud in August and will target the Cretaceous, Jurassic and Triassic formations.  Planned total depth, depending on well results, is 3,850 meters and drilling is expected to take 6 months.  The Company's estimated oil-in-place resource potential for the Sheikh Adi structure is in excess of one billion barrels.

Enquiries:

Gulf Keystone Petroleum:	[phone]
Todd Kozel, Executive Chairman
Ewen Ainsworth, Chief Financial Officer
Strand Hanson Limited	[phone]
Simon Raggett / Rory Murphy / James Harris
Mirabaud Securities LLP	[phone]
Peter Krens
Brunswick Group LLP	[phone]
Patrick Handley / Pip Green

or visit: www.gulfkeystone.com

John Gerstenlauer, the Company's Chief Operating Officer, who has 31 years of relevant experience within the sector meets the criteria of a qualified person under the AIM note for mining, oil and gas companies and has reviewed and approved the technical information contained in this announcement.  Mr. Gerstenlauer is a member of the Society of Petroleum Engineers.

Notes to Editors:

§  Gulf Keystone Petroleum Ltd. (AIM: GKP) is an independent oil and gas exploration company focused on exploration in the Kurdistan region of Northern Iraq.

§  Gulf Keystone Petroleum International (GKPI) holds Production Sharing Contracts for fourexploration blocks in Kurdistan.

§  The Company's shares have traded on the AIM market, since listing on 8 Sept 2004.

§  Gulf Keystone Petroleum Limited is registered in Hamilton, Bermuda with offices in Erbil, Kurdistan, Algiers, Algeria and London, UK.

§  Oil initially-in-place is that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations prior to production. The range of uncertainty of the oil-in-place volumes is represented by a probability distribution with a low and high provided: P90 represents at least a 90% probability (high) that the quantities determined to be in place will equal or exceed the low estimate and P10 represents at least a 10% probability (low) that the quantities determined to be in place will equal or exceed the high estimate.  P1 represents at least a 1% probability that the quantities determined to be in place will equal or exceed the ultimate upside estimate.

Not for release, publication or distribution, directly or indirectly, in or into the United States or jurisdictions other than the United Kingdom and Bermuda where to do so would constitute a contravention of the relevant laws of such jurisdiction. This document (and the information contained herein) does not contain or constitute an offer of securities for sale, or solicitation of an offer to purchase securities, in the United States or jurisdictions other than the United Kingdom and Bermuda where to do so would constitute a contravention of the relevant laws of such jurisdiction. The securities referred to herein have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States unless the securities are registered under the Securities Act, or an exemption from the registration requirements of the Securities Act is available. No public offering of the securities will be made in the United States.

 

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