Canning Basin EP417 - Conventional and Unconventional Gas Project

“The potential for shale gas to dramatically alter the entire Australian energy sector is significant given what has occurred in the US and based on industry estimates for as much as 400 trillion cubic feet (tcf) of recoverable gas in total” (EIA, 2011)

Our Objective

Our objective is to define, develop and produce large scale economic natural gas resources in conjunction with our Joint Venture Partners.

The EP417 farm-in complements Green Rock Energy’s (Green Rock) existing geothermal business by leveraging the commercial and technical resources experience of the Directors, whilst providing Green Rock with exposure to the emerging shale gas and tight gas industries in Australia.

The Project

Green Rock Energy executed a Farm-In Agreement with New Standard Energy (“New Standard”) in March 2011 to earn an initial 15% interest in Exploration Permit EP417 in the Fitzroy Trough in the Canning Basin in Western Australia by participating in a well on the Permit in 2011. Upon initial farm-in the interests in EP417 will be New Standard 50% (the Operator), Buru Energy Limited (ASX:BRU) (“Buru”) 35% and Green Rock 15%. Green Rock can earn an additional 5% through participating in funding a second exploration well on the permit.

EP417 lies in the southern Canning Basin in the Kimberley region of Western Australia. Contained within EP417 are several conventional targets of natural gas and regional potential for large scale unconventional gas resources. The unconventional shale gas and tight gas prospectivity of the significant Laurel Formation and Anderson Formation across EP417, provides an attractive opportunity for short term, large scale exploration success.

The regional Laurel play illustrating the large scale of the prospective resources being pursued in the region

The prospective Laurel Formation including the new Seven Lakes SPA, EP417 and various prospects

Source: GRK ASX Announcement, 25 July 2011

ACTIVITIES

Green Rock’s interest in EP417 provides funding of two wells. The first is a re-entry (planned for September 2011) of the existing Lawford#1 well which was initially spudded by New Standard in 2008 before being temporarily suspended before reaching the target Anderson and Laurel Formations due to mechanical issues and the impending onset of the wet season. Deepening of Lawford#1 to the Laurel and Anderson Formations provides attractive drilling targets with both large conventional and unconventional gas resource potential.

The Joint Venture participants estimate that Lawford prospect has the capacity to host in excess of 500Bcf of gas in place as a conventional target. In addition, the assessment of the shales and tight sands of the Laurel and Anderson Formations contained within the Lawford structure (but which extend regionally beyond the structural closure at Lawford) will provide important information and upside for an extensive unconventional play across EP417 and throughout the region.