Bijeel-1 Discovery Well Updat

RNS Number : 7766V

Gulf Keystone Petroleum Ltd

08 November 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.

8 November 2010

Gulf Keystone Petroleum Ltd. (AIM: GKP)

("Gulf Keystone" or "the Company")

Bijeel-1 Discovery Well Update

Gulf Keystone notes the announcement made today by MOL Hungarian Oil & Gas Plc regarding the successful end of testing of the Bijeel-1 discovery well, in which Gulf Keystone holds a 20% Working Interest. 

Highlights

·	The cased hole test, performed at a depth of 3,804 - 3,967 meters in the Jurassic formations, produced 2,700 barrels per day (bbl/d) of 12-13 °API oil through a 40/64 inch choke.
·	Previously, the Bijeel-1 well produced 3,200 bbl/d of 18 °API oil and 933,000 standard cubic feet per day (scf/d) of gas, (150 barrels of oil equivalent per day (boe/d)),  through a 48/64 inch choke from  3,646 - 3,831 meters in the Jurassic formations.
·	A joint cased hole test was also performed for the above two intervals (3,729 - 3,967 meters) with a result of 3,743 bbl/d of 13° API oil and 618,826 scf/d (99 boe/d) gas through a 48/64 inch choke.
·	Following the successful result, Kalegran Ltd, MOL's fully owned subsidiary, has notified the Ministry of Natural Resources of the Kurdistan Regional Government of Iraq confirming the presumed existence of the discovery.
·	The planning of the formation's appraisal programme is now underway.
·	The results support Gulf keystone's belief that the Bijeel-1 well is the possible southern flank of the potentially significant Bekhme structure.
·	Ongoing exploration of the Akri-Bijeel block, including the Bekhme structure, will continue in due course.
·	The Weatherford 842 drilling rig will now be released to the Shaikan-2 location and begin drilling the first deep appraisal well on the Shaikan structure.

A copy of the complete MOL announcement can be found below.

Commenting on today's announcements, John Gerstenlauer, Chief Operating Officer said:

"Today's announcement by MOL brings the testing of the Bijeel-1 well to a successful conclusion and highlights the clear potential of the Akri Bijeel block, in which Gulf Keystone holds a 20% stake.  In addition to this further positive exploration development, we are pleased that the Weatherford 842 drilling rig will now be able to be moved to the nearby Shaikan-2 location, as part of the ongoing Shaikan appraisal programme."

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
Pelham Bell Pottinger LLP	[phone]
Mark Antelme

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 four exploration blocks in Kurdistan. The Company is currently embarking on an active appraisal and exploration drilling campaign in Kurdistan, including work to fully understand the scale of the world class Shaikan Field discovered in 2009.

MOL Hungarian Oil & Gas Plc Announcement:

Testing of Bijeel-1 well in Akri-Bijeel block in the Kurdistan Region of Iraq successfully closed

MOL Hungarian Oil and Gas Plc. hereby informs the capital market participants that it has finished the testing of the first well, Bijeel-1 in Akri-Bijeel Block in the Kurdistan Region of Iraq. The cased hole test performed in the depth of 3,804 - 3,967 m from Jurassic formations produced 2,700 bbl/d 12-13 °API oil through 40/64" choke. Earlier, the Bijeel-1 well produced during an open hole test 3,200 bbl/d 18 °API oil and 933,000 scf/d (150 boe/d) gas through 48/64" choke from interval 3,646 - 3,831 m, Jurassic formations. Finally, a joint cased hole test was performed for the above two intervals (3,729 - 3,967 m) as well, with a result of 3,743 bbl/d 13° API oil and 618,826 scf/d (99 boe/d) gas through 48/64" choke.

Based on the above mentioned results, MOL's fully owned subsidiary, Kalegran Ltd. as operator of the block, has notified the Ministry of Natural Resources of the Kurdistan Regional Government of Iraq confirming the presumed existence of the discovery. The testing results have proven the validity of our geological model providing a solid basis for planning the appraisal program for this formation. The exploration of the block entered automatically into the second subperiod of the initial exploration phase in November 2010, where during the next two years, as a consequence of the results obtained from Bijeel 1 well, we implement an appraisal program and also continue the exploration of the block potential with appropriate capex investment.

Background:

MOL, via its 100% subsidiary, Kalegran Ltd., signed a Production Sharing Contract with the Kurdistan Regional Government for Akri-Bijeel exploration block in 2007. Kalegran is the operator of the block with 80% participating interest and Gulf Keystone Petroleum International Ltd. is our partner with 20% share, both are subject to dilution by a Government held Third Party Participation of 20% and a Government Interest of 20%.

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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