Gulf Keystone Petroleum cheered by results of latest Kurdistan well

Wednesday, Jan 05 2011 by
Gulf Keystone Petroleum cheered by results of latest Kurdistan well

Gulf Keystone Petroleum (LON:GKP) , the oil and gas group active in the Kurdistan region of Iraq, this morning reported that it had finished drilling and testing operations on its Shaikan-3 shallow appraisal well. The well was drilled to 1,100m in order to test Cretaceous age rock intervals for producible oil – an area that could not be completed properly in the original Shaikan-1 well that was drilled in 2009. Flow tests and log evaluations have focused on resources in the Garagu, or lower portion, of the Cretaceous rock. The company said there was a 50% (P50) chance that oil in place volumes were 220 million barrels and a 10% (P10) chance that the volumes were closer to 2.2 billion barrels.

Gulf Keystone is currently involved in an appraisal and exploration programme on its Kurdistan blocks where it wants to firm up the precise nature of the Shaikan field. The company has already discovered between 1.9 billion (P90) and 7.4 billion (P10) barrels of oil in place in the deeper Jurassic and Triassic formations.

It said the large spread between P50 and P10 volumes in the latest well was due to the uncertainty over the exact nature of the Cretaceous down dip, on the flanks of the Shaikan structure. If the Cretaceous is oil bearing near the flanks, then the P10 volumes become more likely and it is possible that the oil will also be less viscous and of higher API gravity. In the meantime, due to the different characteristics of the Cretaceous oil, the Shaikan-3 well has been completed as a second Jurassic producer from the Sargelu formation and will flow into the same test facilities as the Shaikan-1 well.

Gulf Keystone has a 75% working interest in the block and is partnered with the MOL subsidiary, Kalegran, and Texas Keystone which have the remaining 20% and 5% working interests respectively. The partner group is now set to formulate a development plan for the new resources.

John Gerstenlauer, Gulf Keystone’s chief operating officer, said: “The Cretaceous resources evaluated by the Shaikan-3 well are massive by any standard. They represent a significant oil resource for Kurdistan and Iraq. It is a further demonstration of the huge hydrocarbon potential of the area.”

In early December the partners began drilling…

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Gulf Keystone Petroleum Limited (Gulf Keystone) is a holding company, which is engaged in the oil and gas exploration and production. The Company operates in the Kurdistan Region of Iraq. It operates through segments, including Kurdistan Region of Iraq and United Kingdom. The Kurdistan Region of Iraq segment consists of the Shaikan, Ber Bahr blocks and the Erbil office, which provides support to the operations in Kurdistan. The United Kingdom segment provides geological, geophysical, engineering and corporate services to the Company. It operates in the Shaikan oil field. The Shaikan block is situated over 85 kilometers northwest of Erbil, covering an area of over 280 square kilometers. more »

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Mkt Cap (£m)
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4.6



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