GOIL Granby Oil

    15 January 2007

Granby Oil and Gas plc

("Granby" or "the Company" or "the Group")

UK North Sea 42/28c-9 Exploration Well Completed

Drilling of North Sea exploration well 42/28c-9 on the Watling prospect has been completed without
finding commercially producible hydrocarbons.

The  well  began drilling on 18 December 2006 with the ENSCO 92 rig operated by Centrica Resources
Limited, a subsidiary of Centrica plc, targeting the Watling prospect in a Rotliegendes reservoir.
The  well  was  drilled  to  a total depth of 8,922 feet (2,719 metres),  and  the  reservoir  was
encountered high to prognosis with gas shows, but with no commercially producible hydrocarbons.

The well, which was drilled at no cost to Granby, is to be plugged and abandoned.

David Grassick, Managing Director of Granby Oil and Gas, said:

"Whilst the Watling well was a disappointing result, Granby has many excellent prospects which  we
are  preparing  to  drill over the next couple of years, including the Guinea  prospect  which  is
expected  to  begin  drilling  in  February  2007.  We are  continuing  to  prepare  a  multi-well
exploration programme for 2007 and 2008 based on our 22nd and 23rd Round licences, and are  making
excellent progress with our Galoc and Tristan North West developments."

Richard Moreton, Executive Director of Granby Oil and Gas, said:

"The  final  results  were disappointing given the early encouragement in the  well,  particularly
having found the reservoir at a favourable depth and observing gas shows throughout."

Enquiries:
 Granby Oil and Gas                                    020 7653 3660
    David Grassick, Managing Director                  07785 921080
                                                       
    Nigel Burton, Finance Director                     077 8523 4447
                                                       
                                                       
 College Hill                                          020 7457 2020
    Nick Elwes / Paddy Blewer                                       
                                                       

Notes to Editors

Background to Watling
The  Watling exploration well 42/28c-9 was Granby's third exploration well since its flotation  on
AIM  in  June  2005,  and the Company's first in the Southern North Sea. The block  was  initially
awarded  to  a  Granby-led group in the 23rd Licensing Round. Centrica and Gas  Plus  subsequently
agreed  to  farm  in to the block, leaving Granby fully carried for the cost of  this  exploration
well.  Granby  subsequently  acquired an additional interest  from  the  original  co-venturer  to
increase its carried interest to 33.33% (29.33% net).

Overview of the Business
Granby  Oil and Gas plc (ticker symbol GOIL) is an oil and gas business focused on exploration  in
carefully  selected  areas  in  the North Sea and elsewhere, and also  on  securing  oil  and  gas
production  and developments. The Group's strategy is to build a significant portfolio  of  assets
through both discovery and exploitation of oil and gas reserves.

The  Group  was  created by the combination of Granby Enterprises and Team  Oil,  two  independent
companies  formed  in 2002 which have had common management teams and ownership since  June  2004.
Granby raised �11.5m in 2005, of which �10m was from a placing and Admission to AIM in June  2005,
and an additional �9m in a placing in August 2006.

Granby's portfolio and plans
Granby  is planning a multi-well exploration programme in the North Sea for 2007 and 2008, with  a
fully  funded well on the Guinea prospect in block 15/13b currently expected to begin drilling  in
February  and another testing the Burton Agnes-1 prospect on the onshore licence PEDL071 later  in
the year.

Granby's current acreage comprises interests in a significant portfolio of blocks and part  blocks
in  the  Central  and  Southern North Sea and the Forth Approaches, containing multiple  prospects
generated by the Company. Granby also has an interest in a single onshore licence in Yorkshire.

In  addition,  Granby  has  a  9.14% indirect interest in the Galoc field,  offshore  Philippines,
through its 15.69% shareholding in the Galoc Production Company ('GPC') which operates the  field.
Development  of  the  Galoc  oil  field is now fully approved by  co-venturers  and  the  relevant
authorities.  First oil production from the field is expected in late 2007 at an initial  rate  of
approximately 15,000 bopd.

Granby has also earned a 42% interest in the Tristan North West gas development in block 49/29b in
the  UK Southern North Sea and executed a loan facility agreement with Mitsubishi Corporation  for
the  development.  First production is currently anticipated to be in late  2007  or  early  2008,
subject to availability of a suitable rig and other items with long lead times.

Granby  announced on 5 January 2007 that it has secured a 9.0% interest in the Monkwell gas  field
in UK Block 42/29a in the Southern North Sea.



                                                                
Granby Oil & Gas plc



                                                                

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