Groundstar Resources Limited

Groundstar Resources Limited

August 31, 2010 09:02 ET

Groundstar Resources Receives US$1 Million Loan From Aegean Energy

CALGARY, ALBERTA--(Marketwire - Aug. 31, 2010) - Groundstar Resources Limited (TSX VENTURE:GSA) (the "Company") is pleased to announce that in accordance with the Sale Agreement terms with Aegean Energy for the West Kom Ombo Block (WKO) in Upper Egypt as announced on June 6, 2010, the Company has received a US$1.00 million interest free loan from Aegean Energy in order to undertake activities such as road building, long-lead items procurement and engagement of contractors in preparation of drilling the first exploration well on the West Kom Ombo Block. Upon approval of the deeds of assignment by the Egyptian authorities which will transfer a 70% net interest in the Block to Aegean Energy, Groundstar will receive US$5.00 million from Aegean. The balance of this loan not expensed on the date Aegean Energy assumes operatorship of the Block will be repaid to Aegean. Groundstar will retain a 10% net carried interest to September 16, 2014.

The operator in concert with Aegean has initiated construction of a 35 km access road for the first exploration well in WKO. This access road that is expected to take 60 days to complete starts from the tarmac highway connecting Luxor to El Kharga Oasis approximately 120 km from Luxor going south. Tendering process for a drilling rig, wellheads and casing has been completed. The operator is now in the process of awarding contracts to the successful bidders.

The WKO-1 exploratory well is scheduled to spud in November 2010. Drilling of the next three wells could follow in rapid succession.

Groundstar appreciates the cooperation and support of Aegean Energy to expedite the commencement of exploratory drilling of up to four wells on the Block.

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 Aegean Energy S.A.

Aegean Energy 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. Aegean Energy in Egypt operates the offshore East Magawish concession in the Gulf of Suez. For further information about Aegean Energy please visit

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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