Groundstar Resources Limited
TSX VENTURE : GSA

Groundstar Resources Limited

January 04, 2011 07:00 ET

Groundstar Resources Announces Spud of the First Exploration Well in West Kom Ombo, Upper Egypt

CALGARY, ALBERTA--(Marketwire - Jan. 4, 2011) -

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Groundstar Resources Limited (TSX VENTURE:GSA) ("Groundstar" or the "Company"), in conjunction with Energean Oil & Gas, is pleased to announce the spud of the West Kom Ombo - 1 exploration well on the West Kom Ombo block in Upper Egypt. This is the first exploration well of two firm commitment wells and two additional optional wells with a capital expenditure of up to US$30 million gross. Groundstar is carried for a 10% net interest through the exploration drilling stage.

The well is located in Area A on a fault controlled closure defined by seismic data. An active petroleum system has been proven at the Al Baraka field in the adjacent block to the east operated by Dana Gas Egypt. It is anticipated similar geology will be present in Area A.

The well will drill to approximately 2,370 meters and is expected to reach total depth in about 45 days. After completion of drilling, the rig is expected to move to drill Prospect B, about 100 kilometers to the southwest.

Groundstar is extremely excited to participate in the drilling of another high potential exploration well that follows the currently drilling Qara Dagh - 1 well in Kurdistan, Iraq, and the spud of the Apoteri K-2 exploration well on the Takutu Petroleum Prospecting Licence (PPL) in Guyana. The Company extends their appreciation to Energean for their dedication to the project and looks forward to a successful drilling campaign.

About Groundstar Resources Limited

Groundstar is a publicly traded Canadian junior oil and gas company actively pursuing exploration opportunities in Guyana, North Africa and the Middle East.

About Energean Oil & Gas

Energean Oil & Gas is a private international upstream oil and gas exploration and production company with a Mediterranean and North African Basin focus with oil and gas operated assets in Greece and Egypt. Energean Oil & Gas operates the offshore East Magawish concession in the Gulf of Suez and is the operator of West Kom Ombo Block. For further information about Energean Oil & Gas please visit www.energean.com.

This press release may contain forward-looking statements within the meaning of applicable securities laws. Forward-looking statements may include estimates, plans, anticipations, expectations, opinions, forecasts, projections, guidance or other similar statements that are not statements of fact. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. These risks include, but are not limited to: the risks associated with the oil and gas industry (e.g. operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses and health, safety and environmental risks), commodity price and exchange rate fluctuation and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligations to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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