ann out.............significant gas shows, page-2

Napoleonville ‐ Sagers #1, Assumption Parish, Louisiana, Non Operator 39.89% WI
The Board of Grand Gulf Energy Ltd (ASX: GGE) is pleased to advise the Sagers #1 well is presently drilling ahead at 9,585ft. The well is expected to reach TD within the next day. Significant gas shows have been observed in the well. The significance of the gas show will be determined after a full electric logging operation is completed once the well reaches targeted depth of 10,100ft, and if warranted, a production testing operation is conducted. The Sagers #1 well is testing the Operc and Cris R III Sands as primary objectives with 300,000 barrels and 1.2 BCF of gas classified as a proven undeveloped (PUD) target. Further upside exists in secondary exploration objectives in the Marg A and Cris R I of 300,000 barrels of oil and 1.2 BCF of gas. If the well is successful, initial flow rates are expected to be around the 200+ barrels of oil per day and 500 thousand cubic feet (MCF) of gas per day.

Napoleonville‐ Dugas & Leblanc #1 Well, Assumption Parish, Louisiana, 39.5% WI
The workover rig has managed to recover 800 ft of 5 inch casing and will attempt to recover the tubing
this week. The workover rig is likely to attempt to pull further pipe to determine whether the casing is in
suitable condition. The well may still be converted into a production well. Otherwise, subject to
Government approval, it will be plugged and abandoned.

Napoleonville‐ Dugas & Leblanc #2 Well, Assumption Parish, Louisiana, 39.5% WI
As previously announced, this well encountered over 118ft of net pay (both oil and gas) over three sands
including an additional 19ft of gas and oil column in the Big Hum N sand.The workover rig that is presently working on the Dugas & LeBlanc #1, will be moved to the Dugas & Leblanc #2 as soon as it is released and testing the oil leg in the Big Hum N sand in #2 will commence shortly thereafter. The Operator has recorded a cement bond log in the interim and confirmed that a successful cement/casing bond has been placed over the M and N sands. The Company previously advised that this prospect was targeting a 1.2 MMBO and 3 BCF gas anomaly. The Company does not believe that this volume will be materially reduced as a result of the uncontrolled flow of the Dugas & Leblanc #1 that occurred from 11 August to 24 August 2010. If the well is successful initial flow rates are expected to be around the 200+ barrels of oil per day and 1,000 MCF per day.