Grey Wolf Exploration Inc.
TSX : GWE

Grey Wolf Exploration Inc.

February 24, 2009 14:27 ET

Grey Wolf Exploration Inc. Boosts Production Over 3,100 boe/d

CALGARY, ALBERTA--(Marketwire - Feb. 24, 2009) -

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Grey Wolf Exploration Inc. ("Grey Wolf") (TSX:GWE) is pleased to report that January 2009 production levels averaged over 2,400 barrels of oil equivalent per day ("boe/d"), an increase of 14 percent over the first quarter of 2008. The increase in January production is attributable to satisfactory performance on our first two (1.5 net) horizontal wells in the Pouce Coupe Montney/Doig play. Continuing geological and engineering review of our lands show approximately 50 additional horizontal locations, net to Grey Wolf, in the area.

We are also pleased to report first production from our Petitot core area in northwest Alberta where we hold over 54,000 acres of 100 percent owned lands, of which approximately 20,000 acres are now covered with 3D seismic. The Petitot 2-17 was placed on production February 20 at an initial rate of approximately 5 million cubic feet per day ("MMcf/d") raw gas (700 boe/d sales gas) from the Slave Point formation at approximately 2,000 meters in depth. Plans are to monitor production over time and if warranted, and if processing capacity becomes available, gradually increase production. This new production includes a certain amount of flush production that we expect will decline over time. Current Grey Wolf production is over 3,100 boe/d.

Current production levels are at, or close to, our full firm gas processing capacity in both of our core areas. Plans are in place to increase our firm capacity and our excellent inventory of lower risk drilling locations allows Grey Wolf to meet such increases. In this context, it should be noted that, like many other operators, Grey Wolf is in no rush to drill in current economic conditions. Our business plan is in place and it is working to increase production with prudent, timely investment of cash flow, and to make provision for the reduction in debt.

In response to a letter received from a shareholder regarding concerns with the corporate business plan, Bob Watson, Chairman and Chief Executive Officer stated, "In the current economic climate, it is unusual to find a junior oil and gas company that has significantly increased production through drilling in the past 12 months. We feel this validates our business plan that is designed to build production and pay down debt within the limits of current cash flow. That being said, our Board of Directors has evaluated, and continues to actively evaluate opportunities to maximize shareholder value."

Grey Wolf is an Alberta-based oil and natural gas company involved in the exploration, development and production of natural gas and crude oil in the Western Canadian Sedimentary Basin. Grey Wolf operates horizontal resource plays in the Doig and Montney of the Peace River Arch and the Horn River Shale at Petitot. Conventional operations include the gas reservoirs of the Slave Point at Petitot and the gas reservoirs in the Cardium, Viking and Mannville at Caroline. The Company's common shares trade on the Toronto Stock Exchange under the symbol "GWE".

Forward-Looking Statements - Certain information set forth in this document, including management's assessment of Grey Wolf's future plans and operations, contains forward-looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond Grey Wolf's control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Grey Wolf's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements. No assurance can be given that any of the events anticipated will transpire or occur, or if any of them do so, what benefits Grey Wolf will derive from them. Grey Wolf disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

The calculation of barrels of oil equivalent (.boe.) is based on a conversion ratio of six thousand cubic feet of natural gas to one barrel of oil to estimate relative energy content and does not represent a value equivalency. boes may be misleading, particularly if used in isolation.

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