GKP Shares Up Following Update

Akri-Bijeel (20% working interest)

Bijell-1B is a side-track well targeting the Jurassic horizons of the Bijell discovery and currently drilling 8 ½" hole in the Jurassic below 3,820 metres.

Bijell-2 is a deep appraisal well targeting the Triassic horizons of the Bijell discovery and currently drilling and coring in the Sargelu formation below 3,900 metres.

Bijell-4 is an appraisal well targeting the Jurassic horizons of the Bijell discovery and currently in 17 ½" hole in the Upper Fars formation below 1,040 metres.

Finance

The US$50 million tap issue of convertible bonds in November 2013 confirmed investor interest to invest in the Company's evolving story. The Company's increasing production will provide a recurring revenue stream and the Company believes that this will provide an opportunity for Gulf Keystone to access the debt market under more favourable terms in due course.

In order to fund the Company's ongoing capital expenditure requirements and meet its obligations under the terms of the Shaikan PSC, the Company is in discussions with a major international bank to assist with the evaluation of the Company's near term debt financing options.

Following the hearing in the English Commercial Court (the "Court") on 13 December 2013 and the resultant Court Order, the Company has now received £17,500,000, which had been paid into Court as security for the costs of the Company, its two subsidiaries and Texas Keystone Inc. (together the "Defendants") by the funders of Excalibur Ventures LCC ("Excalibur"). Texas Keystone Inc. holds a 5% interest in the Shaikan PSC in trust for Gulf Keystone, pending transfer of its interest to the Company.

According to the Judgment handed down on 13 December 2013, the Court ordered that the Defendants should recover their costs of these legal proceedings and that these costs, if not agreed, should be assessed on an indemnity basis, and that Excalibur must pay interest on the Defendants' costs at the rate of 1.5% per annum, from the date of payment of the invoices until 13 December 2013.