Buccaneer Energy Limited (ASX:BCC) Kenai Loop Project Update

Sydney, Oct 19, 2011 AEST (ABN Newswire) - Buccaneer Energy Limited (ASX:BCC) reports the following in respect to the Kenai Loop project.

The Kenai Loop #3 well ("KL #3") was drilled approximately 100 feet up-dip to the successful Kenai Loop #1 well ("KL #1"). The KL #3 bottom hole location was 1,700 feet to the south of the KL #1 well and approximately 1.0 mile north of the Cannery Loop field (which produced 178 BCF of gas).

The KL #3 well encountered four well developed Tyonek sand packages (Zones 1-4); wire line log data indicated good permeability, porosity with possible gas pay in at least 3 of those zones. All four zones were perforated and proved to be non productive.

KL #1 encountered virgin pressure in its sand packages, pressure testing from KL #3 indicates that depleted (~20%) pressures were encountered. The Company's geological model anticipated that the Kenai Loop field was separated from the Cannery Loop field, the depleted pressures clearly indicate that KL #3 is in communication with Cannery Loop and is geologically separated from the KL #1 location by a fault.

KL #3 is part of a multi-well development program necessary to identify and drain proven and potential reserves in the Kenai Loop complex. The data from KL #3 well is useful in identifying the seal mechanism and determining the depositional nature of pay sands in the area. The results in no way change the Company's view of the significant potential of the overall Kenai Loop project.

Importantly, these results have little or no impact or effect on the total recoverable proven and potential reserves from KL #1 as the aerial extent of those reserves lie to the north of the KL #3 well.

KL #1 is on target to commence production in December 2011.

Over the coming months, the Company intends to undertake the following activities:

- Permit and then complete a 3D seismic survey over the southern part of Kenai Loop;

- Map the fault using the 3D seismic, new data from KL #3 as well as recently acquired non public data from the Cannery Loop field; and

- On completion of the above, drill a side-track well within KL #3 giving it a bottom hole location within the known proven sand packages encountered by the KL #1 well and the new sand packages in the KL #3.

Prior to drilling KL #3 the Company's plan was to drill an additional Kenai Loop well in April 2012 after the winter period, this timing has not changed.

Contact

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