Buccaneer Energy Limited (ASX:BCC) Operational Update on Pompano and Lee County

Sydney, Aug 17, 2011 AEST (ABN Newswire) - Buccaneer Energy Limited (ASX:BCC) has a 65.0% working interest in the SL 103229 and SL 103230 wells located in the Pompano field in the Gulf of Mexico. Both wells were drilled and placed onto production in early 2008 and have produced a total of 6.33 BCF of gas to date.

Production from these wells has over time declined naturally with gradual depletion of reservoir pressure and in some cases sand being carried into the wells' tubing, these wells and are now producing <0.5 MMCFD. A jack-up liftboat has now been placed on location and has commenced performing a wireline work-over on a zone in each well. The operation is expected to take ~ 14 - 18 days to perform.

If both operations are successful then it is anticipated production from the two wells will increase significantly from the current levels.

Lee County

Buccaneer has a 52.5% working interest in the Alexander # 1 well located 120 miles north-west of Houston located with the Lee County project. A vertical well was drilled through the Austin Chalk in September 2010, with excellent shows of oil produced while drilling. The original drilling plan was to drill and evaluate the Austin Chalk and Eagle Ford Shale.

With initial production from fractures within the middle Austin Chalk in excess of 900 BOPD, the plan was modified to penetrate these middle Austin Chalk fracture zones with a 2500 foot horizontal. A malfunction with the directional drilling equipment precluded drilling the horizontal segment at that time and the well was completed as a vertical well in the identified fractures, the vertical well initially produced at 948 BOPD over a 72 hour period under natural pressure.

Production naturally declined and the well was placed on pump with expectations of a stabilised production rate of 100 - 200 BOPD. Production was inhibited due to shale from above the Austin Chalk "sloughing" into the well bore and blocking the oil from the pump. After multiple clean outs, it has been determined to now execute the originally planned horizontal.

A rig has now been placed on location to drill a 2,500 foot horizontal within the identified fractures in the middle Austin Chalk that initially produced 948 BOPD. A liner will also be set to seal the shale above the Austin Chalk. The operation is expected to take about 14-20 days to perform.

If the operation is successful it is anticipated production from the will again be established.

Contact

Dean Gallegos Mob: +61-416-220-007 Tel: +61-2-9233-2520 http://www.buccenergy.com