Slide Background

Investor Relations

Annual results for the year ended December 2014

Annual results for the year ended December 2014

13 April 2015

                                                                                                 Greka Drilling Limited

                                                                                      ("Greka Drilling" or the Company”)

Greka Drilling (AIM: GDL), the largest independent and specialized unconventional oil and gas driller in China, is pleased to announce its annual results for the year ended 31 December 2014.

FINANCIAL HIGHLIGHTS

·           Annual revenues US$24.4m (2013: US$30.5m)

·           Second half revenues significantly above H1 2014 revenues

·           Losses before tax widened to US$5.3m (2013: profit US$1.1m) due to investment in Indian operations

            and contracted drilling moved by client into 2015

·           Year-end cash and bank deposits of US$8.0m (including restricted cash) (2013: US$16.1m)

·           Gross margin 26%, compared with 28% in same period last year

OPERATIONAL HIGHLIGHTS

·           Expanded operations into India and recruited approximately 200 staff for India operations

·           Indian head office established in New Delhi

·           Field operational hub set-up including warehouse and yard in Durgapur, West Bengal

·           Started drilling operations in West Bengal on 4 October 2014, under the contract with Essar Oil Ltd (“Essar”)

·           A 100% successful first attempt at intersecting the vertical well in a LiFaBriC completion with the Company’s own

            Rotating Magnet Ranging Systems (“RMRS”)

·           10 well LiFaBriC contract commenced and completed  for Green Dragon Gas Ltd (“GDG ”)

·           Further 30 well LiFaBriC contract awarded by GDG for 2015 drilling campaign has been mobilized

·           Contracted parties include GDG, CNPC, Sinopec (BOFA) and  Essar Oil

·           2015 pipeline includes the 30 contracted LiFaBriC wells for GDG and an additional 100 wells for third parties.

             Mobilization on these contracts and thus the pace of drilling are at  the discretion of the contracted parties

NON FINANCIAL KPIs

·           The maximum meters drilled in a single LiFaBriC well was 3,571m in 2014 (2013: 4,554m)

·           The longest MD of a single LiFaBriC section, surface to intersect, was 1,600m in 2014 (2013: 1,917.5m)

·           The deepest TVD of a directional was 1,556.6m (1,594m MD), (2013: 1,280.9m TVD (1,351m MD))

·           Fastest vertical well was drilled in 5.1 days to a depth of 620m or 121.6m/day; 2013: fastest well 9.35 days to a depth

            of  795m or 85m/day -  a 43% improvement

·           Fastest directional well was drilled in 7.8 days to a depth of 1,494m or 191.5m/day; 2013: fastest well drilled in 6.48

            days but to a depth of only

            752m or 116m/day – a 65%

            improvement

·           Fastest LiFaBriC well was drilled in 22.9 days to 1,412.4m MD (TVD 566.7m) or 61.7m/day. 2013: fastest LiFaBriC

            drilled in 35.6 days to 1,882.5m MD (TVD 862m) or 52.9m/day -

            a 17% improvement

·           Zero lost time in the period due to injury or accident

Randeep S. Grewal, Chairman & CEO of Greka Drilling, commented:

2014 was a difficult financial year as we waited for our clients to start their drilling campaigns.  During the year management focused its attention on personnel and operational optimization which was well reflected in improved drilling accuracy and efficiency. In addition, we successfully started the operations in India which adds an important geography to our footprint.

“We are truly excited about 2015 which started with robust mobilization and drilling orders from both our principal clients, GDG and Essar.”

For further information on Greka Drilling, please refer to the website at www.grekadrilling.com or contact:

James Henderson / Rollo Crichton-Stuart

Investor Relations

Bell Pottinger

+44 20 7861 3800

Dr Azhic Basirov / David Jones / Ben Jeynes

Nominated Adviser

Smith & Williamson

+44 20 7131 4000

James Felix / Michael McNeily

Broker

Arden Partners

+44 20 7614 5900

Mark Taylor

Broker

Charles Stanley Securities

+44 20 7149 6000