Algeria Licensing Bid Result

Gulf Keystone Petroleum Ld
11 April 2005



11 April 2005



                        GULF KEYSTONE PETROLEUM LIMITED
                       ("Gulf Keystone" or "the Company")


   Gulf Keystone Awarded Two blocks in Algeria's 6th International Bid Round


Gulf Keystone Petroleum, Ltd. (AIM-GKP), an independent oil exploration company
operating in the Republic of Algeria, announces that it has been awarded two
exploration blocks in Algeria's 6th international licensing round.


The awards were announced on April 9, 2005. Gulf Keystone's awards comprise
block 129 on the Bottena perimeter in the South East Constantine Basin and
blocks 317b1-322b3-347b-348-349b on the Hassi Ba Hamou perimeter in the Bechar
Oued Namous basin.


Block 129 is located due east of Block 126a, which is currently operated by Gulf
Keystone, and covers an area of 4,368.55 km(2). The block contains two existing
SONATRACH discoveries, the Djebel Onk oil field and the Djebel Foua gas field.
SONATRACH has previously acquired 5300 km of 2D seismic analysis and 379 km of
3D seismic analysis from which it has identified two exploration prospects and
nine leads. The existing gas pipelines from Hassi R'mel to Tunisia and Europe
cross the block.


Hassi Ba Hamou blocks 317b1-322b3-347b-348-349b cover an area of 18,380 km(2)
and contain one existing SONATRACH discovery HBH-1. SONATRACH had previously
acquired 4069 km of 2D seismic analysis and from that seismic it has identified
five exploration prospects.


Whilst Gulf Keystone will have the benefit of the existing discoveries on these
blocks, it will also actively pursue the exploration upside of both blocks. The
Company has undertaken to drill three exploration wells.


Todd Kozel, Chief Executive Officer of Gulf Keystone said:


"We are extremely excited about the award of these two blocks. Block 129 expands
our current position in the South East Constantine basin, while Hassi Ba Hamou
secures a position in an entirely new prospective basin in Algeria with strong
upside potential."


Enquiries


Evolution Securities                          020 7071 4300

Stuart Andrews


Citigate Dewe Rogerson                        020 7638 9571

Martin Jackson/Kate Delahunty


Notes to Editors


Introduction


Gulf Keystone has a Production Sharing Contract with SONATRACH, the Algerian
National Oil Enterprise, for Block 126 in the north eastern area of Algeria near
to the Tunisian boarder.  The Company has operated in the Algerian oil sector
since 2001 and its management team has extensive experience in the North
African, Middle Eastern and United States operating and regulatory environments.


Algeria


Algeria is a member of OPEC (the Organisation of Petroleum Exporting Countries)
and is estimated by an EIA Report to have proven reserves of 37.9 billion boe.
These reserves are estimated to represent 0.9% of the world's crude oil reserves
and 2.6% of the world's natural gas reserves.  Algeria is the world's 16th
largest oil producer and the 6th largest gas producer, with its 2003 oil
production totalling approximately 1.86 million bbl/d.  Algeria is a major
exporter of oil and gas, and the National Council of Energy believes that the
country contains vast undeveloped oil and gas reserves.  Over the last few
years, significant oil and gas discoveries have been made, largely by foreign
companies in partnership with Sonatrach.  Algeria's oil sector, unlike that of
most OPEC countries, has been open to foreign investment for more than a decade
to assist with the development of its oil reserves.


Business


Block 126 is at an early stage of development.  The Company intends to grow the
proven and probable reserves by a programme of further drilling, testing and
evaluation of the GKN field and the GKS, GRJ, OGZ and FKN discoveries.  It is
further intended to pursue the exploration drilling of identified prospects and
leads.  Block 126 had aggregate estimated remaining proven and probable reserves
of approximately 221 MMboe of which Gulf Keystone's share is approximately 107
MMboe.  The Company considers that Block 126 has significant upside potential in
possible and lead prospective resources  of 959.6 MMSTB and 2.6 Tcf of gas.


Strategy


Management intends to exploit its position as an independent exploration company
operating in Algeria by continuing to drill exploratory wells on prospects
showing strong perceived geophysical evidence of commercially viable oil and gas
reserves.  At the same time, it intends to continue to drill development wells
in fields containing proven reserves.


Specifically, the Company currently intends to focus on (i) the development of
the GKN field which contains a producing well; (ii) carrying out appraisal work
on prospects GRJ, OGZ, GKS and FKN; (iii) conducting further exploration works
on new prospects and leads on Block 126.  The Company intends to participate in
future bid rounds to attempt to secure additional blocks in Algeria and to
evaluate other oil and gas prospects in North Africa and the Middle East.  In
addition, the Company intends to seek opportunities to partner with new and
existing operators in Algeria such as SONATRACH.



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