GOIL Granby Oil

    12 March 2007

Granby Oil and Gas plc

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

Operational Update


UK North Sea 15/13b-8 Exploration Well

Drilling of North Sea exploration well 15/13b-8 was completed on 9 March 2007.

The  well  began  drilling  on 24 February 2007 with the rig Borgsten Dolphin  operated  by  Nexen
Petroleum  (UK)  Limited  and  was targeting a Balmoral sandstone  reservoir.  The  reservoir  was
encountered close to prognosis, but did not contain hydrocarbons. The well was drilled to a  total
depth of 7,140 feet (2,176 metres).

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


2007/8 Work Programme

Granby has an extensive work programme over the coming year.

Granby's next well is expected to be the Burton Agnes-1 exploration well onshore Yorkshire, in mid
2007.  This will be followed before the end of 2007 by the Tristan North West Development well  in
the  Southern North Sea and the two Galoc development wells in the Philippines.  Granby  has  also
announced  today,  in  a separate announcement, that the project financing  for  the  Galoc  Field
development has been completed.    A well on the Monkwell discovery is also planned in the next 12
months.

Granby and its co-venturers will be shooting seismic surveys over at least three licences in 2007.
High  resolution  2D  surveys (with closely spaced lines and processed to  simulate  3D)  will  be
recorded  over the Globe/Roebuck prospects in block 9/22 and over the Anglesey prospect  in  block
14/14b.   Assuming favourable results from the new data these prospects can then  be  fast-tracked
for early drilling.

Further  high resolution 2D seismic data will also be recorded over the newly awarded  24th  round
block 16/11, specifically targeting 2 new prospects (Dove and Skylark).

In  addition  to this new data acquisition, Granby will also be undertaking a number  of  detailed
seismic  reprocessing  projects within its portfolio - again, aimed  at  prospect  de-risking  and
maximising  the chance of exploration success. Examples include the Wheatsheaf prospect  in  block
44/27b,  the  Whitelock prospect in block 14/27b, the Oakleigh prospect in block  16/3f,  and  the
Whalebone prospect in block 47/18. The Whalebone and Oakleigh prospects, in particular,  are  both
promising  candidates for early drilling and are expected to be fully matured by the end  of  this
calendar  year.  Two other blocks (where Granby is currently in discussions with interested  third
parties)  are 13/25 and 43/7. Block 43/7 contains the drill-ready Williamson prospect, a very  low
risk gas target exhibiting direct hydrocarbon indicators.


In  accordance  with  AIM notice 16, the above resource information has been reviewed  by  Richard
Moreton,  Executive Director, who has over 22 years experience as a geophysicist  within  the  oil
industry.


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

"Whilst  we  are  disappointed with this result on Guinea, Granby's portfolio has  many  promising
prospects which we are seeking to drill over the next two years.

We  are  already preparing a multi-well exploration programme for 2007 and 2008 based on our  22nd
and  23rd Round licences, as well as preparing to farm out the licences recently awarded to Granby
in  the 24th Licensing Round which we expect will provide further drilling opportunities. Our next
well will be the Burton Agnes-1 onshore well in Yorkshire.

Work  on  Granby's first two developments (Galoc and Tristan North West), which  are  expected  to
generate cash flow early in 2008, is progressing well, with drilling scheduled in the second  half
of  2007.  Additionally  we  anticipate a well will be drilled on a third  development  (Monkwell)
within the next 12 months."

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

"Granby  is  currently maturing its exploration prospects across its portfolio for drilling  later
this year or in 2008. Near term exploration activity is concentrated on de-risking prospects prior
to  drilling,  both  to  increase their farmout appeal and to maximise the chance  of  exploration
success."


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
The  Guinea exploration well was drilled on block 15/13b which was initially awarded to a  Granby-
led  group in the 22nd Licensing Round. Nexen and Gas Plus subsequently agreed to farm in  to  the
block, leaving Granby and Elixir fully carried for the cost of this exploration well.

Interests in block 15/13b are as follows:

Nexen Petroleum (UK)                     50.00%
Granby Enterprises North Sea Ltd         24.375%
Elixir Petroleum                         13.125%
Gas Plus Italiana SpA                    12.5%


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.

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's current acreage comprises interests in a portfolio of offshore licences in the North Sea,
containing  multiple prospects generated by the Company. Granby also has an interest in  a  single
onshore licence in Yorkshire.

Granby's next exploration well is expected to be drilled onshore in Yorkshire later in the year.

Granby  has a 42% participating interest in the Tristan North West gas development in block 49/29b
in  the  UK  Southern  North  Sea  and  has executed a loan  facility  agreement  with  Mitsubishi
Corporation  for  the  development. A rig has been contracted and  a  tree,  controls  &  flowline
purchased. First gas is expected at the end of 2007.

Granby also has a 9.0% interest in the Monkwell gas field, which consists of two separate dry  gas
accumulations located in UKCS Licence P.001, Block 42/29a.  The field was discovered  in  1989  by
well 42/29-6, which produced gas at a rate of 26.8mmcfd from the Lower Leman Sandstone.  The field
was  appraised  by two further wells which also tested gas.  The operator is actively  progressing
engineering studies on the Monkwell gas field, targeting near-term gas production as a subsea tie-
back to nearby infrastructure.

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 Q1 2008 at an  initial  rate  of
approximately 15,000 bopd.



                                                                
Granby Oil & Gas plc



                                                                

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