The Shaikan Block in the Kurdistan Region of Iraq was independently audited, and the results indicated gross oil-in-place volumes of between 8.0 and 13.4 billion barrels calculated on the P90-to-P10 basis with a mean value of 10.5 billion barrels, according to Gulf Keystone Petroleum Ltd.

The company also completed the testing program for the Shaikan-2 appraisal well, drilled 9.0 km to the southeast of the Shaikan-1 discovery well.

Following a new Triassic discovery in the Kurre Chine C zone announced in August, the company conducted nine well tests in all target formations in the Triassic and Jurassic with the maximum aggregate flow rate of 18,900 barrels of oil per day (b/d).

The audit was done by Dynamic Global Advisors.

Following the conclusion of the Shaikan-2 testing program, the well will be completed as a producer and tied to an additional extended well test (EWT) facility, which the company plans to build and install in 2012.

The drilling rig is currently moving to the location of the Shaikan-6 appraisal well, which is nine km to the east of the Shaikan-2 appraisal well that is due to spud later in 2011 and will drill to an estimated total depth of 3,800 m (12,540 ft) subject to technical conditions.

Gulf Keystone is the operator of the Shaikan Block with a working interest of 75% and is partnered with Kalegran Ltd. (20%) and Texas Keystone Inc. (5%).

John Gerstenlauer, Gulf Keystone's chief operating officer noted, "Following these successful well tests at Shaikan-2 and in anticipation of equally positive results from the Shaikan-4 appraisal well, we plan to design and build an additional testing and production facility for Shaikan-2 capable of producing a minimum of 20,000 b/d.

“The completion of the ongoing upgrade of the existing Shaikan-1 and -3 EWT facilities will lead to an initial production of 20,000 b/d of Shaikan crude to export specifications by mid-2012. The Shaikan-2 facility will increase the production target to 40,000 b/d by the end of 2012,” he continued.