GKP Falls on Spending Concerns

Corporate Developments - to 30 June 2013 and post period end

• On 10 September 2013, the English Commercial Court in London dismissed all the claims asserted by Excalibur Ventures LLC ("Excalibur") against Gulf Keystone, two of its subsidiaries (the "Companies") and Texas Keystone Inc. and decided all issues in favour of the Companies and Texas Keystone Inc.
• Gulf Keystone engaged Deutsche Bank AG, London Branch to act on an exclusive basis in connection with the proposed move from AIM, a market operated by the London Stock Exchange, to the standard segment of the Official List, which is expected to be completed before the end of 2013
• Simon Murray, C.B.E. was appointed Independent Non-Executive Chairman of the Board
• Five additional Non-Executive Directors were appointed to the Company's Board and search process for one other independent Non-Executive Director is on-going.

OUTLOOK

• Increase production from the Shaikan PF-1 to 20,000 bopd by the end of 2013 to generate steady revenues
• Complete, commission and start production at Shaikan PF-2, ramping up production to additional 20,000 bopd, following the completion of flowlines to connect PF-2 to the Shaikan-2, -5 and -10 wells
• Apply cash-neutral approach to growing operations, including the development drilling campaign to drill up to eight wells on Shaikan in 2014 and investment decisions on additional Shaikan production facilities (PF-3 and -4)
• Obtain and evaluate results of the Shaikan-7 exploration well, targeting deeper Triassic and Permian horizons in the Shaikan block
• Appraise the Sheikh Adi discovery and continue to target additional exploration prospects on the block

Todd F Kozel (pictured), CEO of Gulf Keystone, commented:

"As a result of having the Shaikan FDP approved, and in line with the Kurdistan Regional Government's stated production targets for the Shaikan discovery, we are delighted to have entered the first phase of commercial production, which was eagerly awaited by the Company's shareholders. It is an important milestone and another highlight of the four years of hard work since striking oil in August 2009.

"With the protracted Excalibur litigation behind us and the key uncertainty about the Company's future removed, we are working hard to deliver on all of our stated objectives and are very pleased to have appointed Deutsche Bank to advise the Company on achieving our goal to move to the Main Market by the end of 2013."

(Sources: GKP, Yahoo, Bloomberg)