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Gulf Keystone sees 40,000 b/d in Iraq by end-2012

Gulf Keystone Petroleum Ltd. plans to build and upgrade facilities that will make it possible to produce and export 20,000 b/d of oil by mid-2012 and 40,000 b/d by the end of the year from Shaikan, which it calls one of the three major oil fields in Iraqi Kurdistan today.

Gulf Keystone has conducted nine well tests in all target formations in the Triassic and Jurassic that tested a combined 18,900 b/d of oil at the Shaikan-2 appraisal well 9 km southeast of the discovery well.

In anticipation of equally positive results from the Shaikan-4 appraisal well, the company plans to design and build an additional testing and production facility for Shaikan-2 with a minimum capacity of 20,000 b/d of oil. Upgrading of the existing Shaikan-1 & 3 early well test facilities will lead to initial production of 20,000 b/d to export specifications by mid-2012, and the Shaikan-2 facility will increase this to 40,000 b/d by the end of 2012.

The rig is moving to drill the Shaikan-6 appraisal well, 9 km east of Shaikan-2, to 3,800 m.

Shaikan has independently audited volumes of 8-13.4 billion bbl of oil in place.

Gulf Keystone is operator of the Shaikan block with 75% working interest. Kalegran Ltd., a 100% subsidiary of MOL Hungarian Oil and Gas PLC, has 20%, and Texas Keystone Inc. has 5%.

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