The energy explorer, listed on the London stock exchange, announced it spudded Sheik Adi-2, located about 1 mile north of the first well in the area.
"The Sheik Adi block is located immediately to the west of the company's Shaikan block, which is a major discovery," the company emphasized.
In November the explorer revised the reserve estimate at its Shaikan oil discovery in Iraq upward to 10.5 billion barrels.
The company said results from Sheik Adi-1 suggest there is a mean estimate of 1.9 billion barrels of oil-in-place reserves in the field.
"Sheik Adi-2 is a significant addition to our extremely active 2012-2013 drilling program in the Kurdistan Region of Iraq," John Gerstenlauer, Gulf Keystone's chief operating officer, said in a statement. "To date, we have completed or are currently drilling 13 exploration and appraisal wells across the four blocks in the region in which we have interest."