Gulf Keystone Petroleum Regulatory News (GKP)

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.

7 February 2011

Gulf Keystone Petroleum Ltd. (AIM: GKP)

("Gulf Keystone" or "the Company")

Awards under the Executive Bonus Scheme and Share Option Plan

Executive Bonus Scheme for 2010

The Remuneration Committee has recommended to the Trustee ("EBT Trustee") of the Company's Employee Benefit Trust ("EBT") that it makes discretionary awards for 2010 under the Company's Executive Bonus Scheme up to a maximum of 8,453,334 common shares of USD 0.01 ("common shares") to be provisionally allocated for Directors and employees. No more than 2,113,334 common shares can be considered for award in 2011and 3,170,000 common shares in each of the years 2012 and 2013.

The maximum number of common shares that would be available in the EBT under the 2010 Executive Bonus Scheme for the Directors, subject to the discretion of the EBT Trustee, is set out below:

Todd Kozel 3,968,889

Ewen Ainsworth 793,778

John Gerstenlauer 793,778

In addition the Board has approved the direct award [not through the EBT] of up to 888,888 common shares under the 2010 Executive Bonus Scheme to each of Mehdi Varzi and Lord Peter Truscott with no more than 222,222 common shares being considered for award in 2011 and 333,333 common shares in each of the years 2012 and 2013.

Share Subscription by the EBT Trustee

The EBT Trustee has considered the recommendations and indicated on 4 February 2011 that it wishes to subscribe for a total of 5,886,332 common shares in the Company to enable it to effect the discretionary issue of 3,772,998 common shares to Directors and employees in respect of one third of the 2009 Executive Bonus Scheme, in accordance with the previous recommendations of the Remuneration Committee (detailed in announcements of the 7th June and 25th June 2010) and 2,113,334 common shares as recommended in respect of the 2010 Executive Bonus Scheme.

Executive Bonus Scheme Awards 2008, 2009 and 2010

On 4 February 2011 the Board approved the direct issue [not through the EBT] of a further 1,103,948 common shares to enable the Company to effect the final instalment pursuant to the 2008 Executive Bonus Scheme and the second instalment pursuant to the 2009 Executive Bonus Scheme (detailed in announcements of the 7th June and 25th June 2010) and the first instalment pursuant to the 2010 Executive Bonus scheme in favour of certain Directors and employees in accordance with the recommendations of the Remuneration Committee. The direct awards to Directors are as follows:

2008 Final Instalment

Todd Kozel 166,666

Ewen Ainsworth 73,773

Ali Al-Qabandi 150,000

2010 First & 2009 Second Instalment

Mehdi Varzi 255,555

Lord Peter Truscott 255,555

Share Option Plan with Long Term Incentive Performance Conditions

The Remuneration Committee also recommended to the EBT Trustee grants of options under the existing Share Option Plan with stretching long term incentive performance conditions ("2010 LTIP Options"). It recommended that the Trustee grants 2010 LTIP Options over common shares at a price of 175 pence per share to the following Directors as set out below:

Todd Kozel 4,195,000

Ewen Ainsworth 839,000

John Gerstenlauer 839,000

It is recommended that the 2010 LTIP Options will be available for exercise in equal tranches over three financial years subject to the following performance conditions:

(i) One third of the 2010 LTIP Options will vest on the share price reaching 275 pence.

(ii) One third of the 2010 LTIP Options will vest on the share price reaching 325 pence.

(iii) One third of the 2010 LTIP Options will vest on the share price reaching 375 pence.

It recommended to the EBT Trustee that a total of 9,490,000 common shares may be the subject of 2010 LTIP Options for Directors and employees.

The EBT Trustee confirmed on 4 February 2011 that it wishes to grant 2010 LTIP Options at a price of 175 pence per share over a total 9,490,000 common shares including the recommended grant to Todd Kozel, Ewen Ainsworth and John Gerstenlauer as set out above. The closing share price of the Company on the 4 February 2011 was 173.5 pence per share.

Directors Interests in Shares

Following the issue of the 2008, 2009 and 2010 Executive Bonus Scheme shares and the grant of 2010 LTIP Options, subject to the discretion of the EBT Trustee, the interests of the Directors in the share capital of the Company are as follows:

Following the issue of the 2008, 2009 and 2010 Executive Bonus Scheme shares the total issued share capital of Gulf Keystone will be 761,233,441 common shares of USD 0.01. The Company does not hold any common shares in treasury and so the total number of voting rights in Gulf Keystone is 761,233,441.

Application will be made for admission of 6,990,280 new common shares of USD 0.01 to trading on AIM with effect from 11 February 2011.

Enquiries:

or visit: www.gulfkeystone.com

Notes to Editors:

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.