Gulf Keystone Complete Testing of Bijeel-1 Discovery

Gulf Keystone notes the announcement made 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.

Commenting on 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."

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.