GRJ-2 WELL TEST

15 May 2007 11:32

Gulf Keystone Petroleum Ld15 May 2007 GULF KEYSTONE PETROLEUM LTD ("Gulf Keystone" or the "Company") BLOCK 126a - GRJ-2 WELL TEST Gulf Keystone Petroleum Limited, an independent oil and gas exploration companyoperating in the Republic of Algeria in partnership with SONATRACH, announcesthat the Company has abandoned the testing of well GRJ-2 located on Block 126a. Well test operation and results Well GRJ-2 was drilled by Gulf Keystone in late 2005. The well encounteredencouraging hydrocarbon shows in Cenomanian / Turonian carbonates, the samereservoir interval that is currently producing in the GKN-1 well. Moreover,both core and image log data acquired over these prospective reservoir intervalsindicated both the presence of fractures and hydrocarbons. The well was nottested at the time of drilling due to the lack of availability of suitable testequipment within Algeria. During recent operations, Gulf Keystone perforated two potential reservoir zonesover the two intervals: 2291.5 -2337 m and 2221-2276.5 m measured depth. Overeach interval the Company performed an injectivity and step rate test followedby matrix acidisation (mini frac). The aim of the test program was to connectthe fracture and / or the matrix permeability in the surrounding reservoir, andthereby access moveable hydrocarbons. Whilst operations were performed successfully, no hydrocarbons flowed into thewellbore under test. The well is therefore presently being plugged andabandoned. The information contained in this release has been reviewed and approved by MrPeter Dempsey (B,Sc, M.Sc), VP Engineering for Gulf Keystone, who has 24 yearsexperience as a petroleum / reservoir engineer in the oil industry. Todd Kozel, CEO of Gulf Keystone said: "We are disappointed that we were not able to establish connectivity withmoveable hydrocarbons in this well. It is unlikely that we will conduct anyfurther operations on the GRJ structure. However, we will, as part of ouroverall technical appraisal of the northern blocks, review all geological,geophysical and engineering data collected during this operation to establishthe likely reasons for the lack of commercial flow from this particular well." Equities in Block 126a are: Gulf Keystone Petroleum LTD. 60% (Operator)SONATRACH 40% Enquiries Gulf Keystone Petroleum +44 (0)20 7514 1400 Bill Guest Todd Kozel Jon Cooper Hoare Govett Limited +44 (0) 20 7678 8000 Andrew Foster Citigate Dewe Rogerson: 020 7638 9571 Media enquiries: Martin Jackson Analyst enquiries: Kate Delahunty / Nina Soon or visit: www.gulfkeystone.com This information is provided by RNS The company news service from the London Stock Exchange