Groundstar Resources Limited

Groundstar Resources Limited

October 27, 2009 16:30 ET

Groundstar Resources Limited Completes Sale of Working Interest in Takutu Basin, Guyana

CALGARY, ALBERTA--(Marketwire - Oct. 27, 2009) - Kam Fard, President and Chief Executive Officer of Groundstar Resources Limited (TSX VENTURE:GSA) ("Groundstar" or the "Company") is pleased to announce that the sale agreement (the "Agreement") with Canacol Energy Ltd. ("Canacol") for the sale of an additional working interest in the Takutu Basin Petroleum Prospecting Licence (PPL) in Guyana that was originally announced on May 14, 2009 has been successfully completed. The Agreement has been approved by the appropriate Guyana government authorities. Under the terms of the Agreement, Canacol acquired an additional 35% working interest in the PPL in exchange for a cash payment to Groundstar of US$ 3.45 million. Canacol's net working interest in the PPL is now 90%; Groundstar's net interest is 10% which will be carried by Canacol to first commercial production. Groundstar will remain operator of the PPL through to completion of the first exploratory well. The Farm-In Agreement announced on March 12, 2008 between Groundstar and Canacol is terminated by the completion of this sale.

The influx of new funds plus the retention of a carried interest in the PPL is a positive development for Groundstar. Groundstar welcomes Canacol as a highly experienced and successful operator in South America. The intent of the partnership is to drill an exploratory offset well to the 1982 Home Oil light oil discovery on the Karanambo Prospect in the first half of 2010.

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

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 the 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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