Investor Relations

Operational Highlights – 119% increase in Meters Drilled year-on-year Interim Results to be announced on 3 September 2012

29 August 2012

Greka Drilling Limited (AIM: GDL), the largest independent and specialised unconventional gas driller in China, is pleased to announce that its interim results will be released on 3 September 2012.

OPERATIONAL HIGHLIGHTS

• 57,997 meters drilled in H1 2012 compared with 26,435 meters drilled in the same period last year, an increase of 119% year-on-year
• LiFaBriC wells averaged 3,897 total meters in H1 2012 compared with 3,691 total meters during the same period year-on-year (H1 2011), a 6% increase
• The longest LiFaBriC lateral section was 5,454 meters in H1 2012 (5,297 meters in H1 2011), a 3% increase
• The longest measured depth (“MD”) of a single LiFaBriC section, surface to intersect, was 1,809 meters in H1 2012 (1,668 meters in H1 2011), an 8% increase
• The longest total vertical depth (“TVD”) of a single vertical well was 1,414 meters in H1 2012 (1,233 meters in H1 2011), a 15% increase

CORPORATE HIGHLIGHTS

• All new rigs have now arrived at our Shanxi Base Camp  as planned , increasing the fleet from 7 rigs to 32 rigs, with ISO 9001 certification on all  25 new GD75 rigs being attained
• The Company has completed the commissioning and integration of what is currently the single largest fleet of Electromagnetic MWD (Measurement While Drilling) tools available within the People’s Republic of China (“PRC”)
• The first of the new fleet of rigs was fitted with equipment that allowed the rig to be monitored remotely via the Supervised Control and Data Acquisition system (SCADA) from a centralized Zhengzhou control facility. This control system will be added to all the other rigs in the fleet
• Company personnel increased to 715 at end of H1 2012 versus 520 in December 2011 (325 at end of H1 2011), a 38 % increase
• 639 personnel received internal training for a total of 73,684 man hours in H1 2012
• In line with improving overall efficiency and reacting to operational events, the Operational Control Centre (“OCC”) saw the creation of positions for both Well Planning/Modeling and Production Planning Engineers.  These positions give a 24/7 coverage of our operations, providing decisions into the field within 1-2 hours from up to 8 hours historically
• Construction of the Shanxi Base Camp was completed in H1 2012 with a total on-site resident headcount of over 450 personnel. The Company website provides photographs of the site which is the first of its kind in China

The Company is pleased to report that the first phase of the rig fleet expansion plan is now complete. The first phase involved design, construct and commission of a rig fleet of 25 rigs. These rigs, purpose built for unconventional gas development, were co-designed with the manufacturer, made in China and the first of its kind imported in to China being successfully commissioned. This entire business plan was conceived and executed within a year, an important milestone.

The Company, which prides itself in technological firsts, believes it has one of the largest directional drilling teams in China of any independent driller. In coping with the geological difficulties that exist in unconventional gas production, the Company looks forward to providing third parties with the necessary skill sets to optimise drilling and will update the market as and when appropriate.

Today the Company is able to drill at greater depths and geo-steer more precisely with increased well lengths to over 1,800 meters. In addition to this, the Company is now drilling vertical wells targeting unconventional gas reservoirs at depths of over 1,400 meters.

Randeep Grewal, Chairman and Chief Executive of Greka Drilling, commented:

“I am delighted to report that we have grown the business on time and within plan. In this half year we have completed our first phase of rig fleet growth by adding the 25 specialized rigs in which we were instrumental in their configuration and design. We have significantly increased senior management capability from multiple disciplines both within China and from the wider region with skills specific to the drilling services industry. We have enhanced the day-to-day operating structure of the Company and introduced technology that allows the business to reap the benefits of scale. While we have had several clients engage us with an interest in our capabilities, we have so far been focused on getting the fleet and personnel induction phase completed to make sure we are prepared for the next phase of our continued growth.  We are now prepared to accept third party contracts and increase the clientele of the business.”

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