24 Jun 2009 07:00

Not for release, publication or distribution in or into jurisdictions other than theĀ United KingdomĀ andĀ BermudaĀ where to do so would constitute a contravention of the relevant laws of such jurisdiction
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24Ā June 2009
Gulf Keystone Petroleum Ltd.
("Gulf Keystone" or "the Company")
KURDISTANĀ DRILLING UPDATE
Shaikan-1 Exploration Well
Gulf Keystone Petroleum Ltd (AIM: GKP), an independent oil and gas exploration company with interests inĀ Algeria and Kurdistan, today announces the following progress update on the Shaikan-1 exploration well, Shaikan block,Ā theĀ KurdistanĀ region of northernĀ Iraq.
TheĀ Shaikan-1Ā wellĀ was spudded onĀ 27Ā April with a planned TD, pending actual drilling results, of 3000 to 3500Ā metres. The range of TD depthsĀ reflectsĀ the under explored nature of the area and the lack of nearby correlation wells.
Following the setting of 20" surface casing at about 100Ā metres, the well plan called for the drilling of an 8-1/2" pilot hole down to the 13-3/8" intermediate casing point. This decision was based on a number of operational considerations. Primarily,Ā the fractured nature of many of the shallow geological formations and theĀ resultingĀ high likelihood that mud returns would be lost andĀ thusĀ much of the interval would have to be drilled without the informationĀ normallyĀ gained from drilling mud returns. Under these conditions it is more prudent to drill a smaller, easier to control pilot hole as a first step.
Much of this section was, indeed, drilled with little or no drilling mud returns. In addition, consistent with the active oil seeps in the area, much of the pore space in these shallow sections was filled with tar and very heavy, dead oil. At depthsĀ belowĀ 1350Ā metresĀ the well began to encounter lighter, live oil shows.
Subsequently,Ā it was decided to log the entire open hole from 100m down toĀ 1510Ā metres. However,Ā swelling shales prevented the logging tools from getting below 1000Ā metres. Reverting to the planned well program,Ā it was decided toĀ open the pilot hole to the full 17-1/2" diameter necessary for the running of the intermediate casing.
CurrentlyĀ the well isĀ drilling 17-1/2" hole at about 1100Ā metresĀ towardsĀ theĀ plannedĀ intermediateĀ
casing point at 1350Ā metres. Oil shows have increased significantly asĀ the larger hole approaches the deeper portions of the pilot hole. After setting theĀ 13-3/8"Ā casing at 1350Ā metres,Ā GKP plans toĀ log the remaining portion ofĀ theĀ open hole down to 1510Ā metres. ItĀ isĀ this lower portion of open hole thatĀ hasĀ shownĀ indications of porosity and from whichĀ we believeĀ the oilĀ inflow originates. Pending log results, a limited flow test may be warranted.
After evaluation ofĀ thisĀ unexpectedĀ shallow zone,Ā the wellĀ willĀ beĀ drilledĀ toĀ theĀ next casing point as planned. The primary zones of interest for this well are still belowĀ theĀ depth of current activities. Plans are to reachĀ the finalĀ TD of 3000 to 3500Ā metres, pendingĀ actualĀ well results andĀ anyĀ future testing,Ā during September.
The Shaikan Block is situated nearĀ the city ofĀ Dihok, approximately 85 kilometres North-West of Erbil and covers an area of 283 square kilometres. The partners in the Shaikan block are Gulf Keystone Petroleum International Limited (75% working interest and operator),Ā Texas Keystone (5%) and MOL (20%).
Todd Kozel, ExecutiveĀ Chairman of Gulf Keystone, commented:Ā
"Although we are at an early stage in the drilling of this well, we are encouraged by these shallow zone live oil shows and by the good progress our drilling crew is making despite some difficult geological conditions. Subject to what we encounter in the primary zones, we expect Shaikan-1 to reach target depth in line with our planned schedule. "
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Enquiries
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Gulf Keystone Petroleum: |
+44 (0) 20 7514 1400 |
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Todd Kozel, Executive Chairman |
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Ewen Ainsworth, Chief Financial Officer |
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RBCĀ Capital Markets: |
+44 (0) 20 7653 4667 |
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Sarah Wharry |
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Tristone Capital Limited: |
+44 (0) 20 7355 5800 |
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Simon Ashby-Rudd |
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Majid Shafiq |
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Citigate Dewe Rogerson: |
+44 (0) 20 7638 9571 |
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Martin Jackson |
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Emma Woollaston |
or visit:Ā www.gulfkeystone.com
Christopher Garrett, the Company's Vice President of Operations, who has over 29 years relevant experience within the sector meets the criteria of a qualified person under theĀ AIMĀ guidance note for mining, oil and gas companies, and has reviewed and approved the technical information contained in this announcement. Mr Garrett is a Fellow of the Geological Society, a member of the Petroleum Exploration Society of Great Britain, and a Certified Petroleum Geologist (American Association of Petroleum Geologists).
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