Gulf Oil and Gas accountACCOUNT

Spudding of Bekhme-1 Exploration Well

Source: www.gulfoilandgas.com 3/25/2011, Location: Middle East

Gulf Keystone is pleased to announce that the Bekhme-1 Exploration Well has spudded on the Akri-Bijeel block in the Kurdistan Region of Iraq on 21st March 2011.

Bekhme-1 is the second exploration well to be drilled on the Akri-Bijeel block, 20 km to the northeast from the Bijell-1 discovery well (Operator's P50 estimate of 2.4 billion barrels of oil in place). Bekhme-1 will target prospective intervals in the Jurassic and the Triassic with a planned depth of approximately 3000 meters.

The Company has a 20 percent working interest in the Akri-Bijeel block operated by Kalegran Ltd., a 100% subsidiary of MOL Hungarian Oil and Gas Plc., which holds 80 percent working interest in the block.

John Gerstenlauer, Gulf Keystone's Chief Operating Officer commented: "Bekhme-1 is the first well to be drilled on the large surface feature that dominates the north of the Akri-Bijeel block, which is adjacent to the Shaikan block with proven oil and gas reservoirs. The discoveries at Bijell-1 and Shaikan have considerably de-risked this new drilling target making Bekhme an attractive prospect."

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