Gallic Energy Ltd. Provides an Operations Update on the Ossun-2D Well and Initiates Drilling Plans for the Hagolle-2 Well in ...

Gallic Energy Ltd. ("Gallic" or "Company") (TSX VENTURE:GLC) announces that it
has temporarily suspended completion operations at its Ossun-2D well located in
Southern France. The Ossun-2D well was successfully drilled to a total depth of
3,050 m and subsequently cased and cemented after open-hole logs indicated
characteristics of hydrocarbon bearing formations in both the Upper Cretaceous
Flysch Carbonate and the Dano-Paleocene. Wellbore information confirmed the 200
m thickness, porosity, resistivity, and calculated hydrocarbon saturation of the
Upper Cretaceous Flysch Carbonate zone as the primary zone of interest.
Formation imaging logs identified fracturing in the target limestone zone,
including a 17-m thick interval with perpendicular, intersecting fracture sets.
The presence of natural fracture permeability was further confirmed when 9.1 m3
of drilling mud was lost into the Upper Cretaceous. 


The Company used the SMP 101 drilling rig to execute the drilling of the
sidetrack leg and to also conduct the initial completion operations to date. A
net interval of 64 m was perforated in the upper 130 m of the Flysch Carbonate
formation. Following initial perforating, an extrapolated pressure response of
approx. 27 to 28 MPa was evident in the Upper Flysch formation which is
encouraging with no formation water seen. Post perforating, the well encountered
what Gallic believes are correctible problems that restricted the permeability
of the formation (i.e. mud and/or cement losses into the formation at the time
of casing operations). As a result, Gallic, prior to resuming any further
completion or testing operations at the Ossun-2D location, has decided to
analyze all data gathered to understand the inconsistency between the lack of
permeability seen post casing, and the previous formation data observed.
Furthermore, the formation pressure is believed to be near hydrostatic gradient.
The pressure on the formation was 1.36 times hydrostatic when circulating mud
around the 7" production casing at TD. This is believed to have driven mud into
the fractures, effectively sealing them. The pressure on the formation was 1.41
times hydrostatic while cement was being pumped around the production casing,
possibly filling any remaining open fractures with cement. 


The Hagolle-2 well is Gallic's next drilling target on its Ledeuix permit in the
Aquitaine Basin in Southern France. The Company has recently completed its
submission for a permit to drill the prospective well and expects to commence
operations in Q3 2012. The Hagolle-2 well will target a shallow gas zone
previously drilled in the 1980's (Hagolle-1) and is defined on 3D seismic as a
thrusted anticlinal structure. Hagolle-1 demonstrated a gas-charged limestone of
Upper Cretaceous age at 1,100 m and extending to 1,800 m. Hagolle-2 is
positioned to be updip on the same structure as Hagolle-1. The limestone
reservoir is believed to be extensively fractured from the uplift and folding of
the thrusted anticline by tectonic forces. 


Mr. William H. Smith, President and CEO of Gallic, states "While the inability
to obtain prompt conclusive results at Ossun 2D has not yet been achieved, we
are optimistic of achieving a desired outcome. With valuable and encouraging
drilling and log data now obtained, Gallic plans to utilize this information to
either successfully resume completion and testing operations on the Ossun-2 well
and/or to drill future horizontal wells on the play. The majority of fractures
seen on formation imaging logs are dipping 40 - 70 degrees from horizontal.
Therefore a horizontal wellbore is expected to intersect many more of these
fractures than can a vertical wellbore. While assessing the next steps at
Ossun-2, we are also looking forward to drilling the Hagolle-2 well in a
structural position where permeability from natural fractures is believed to be
greatly enhanced." 


Gallic has a 100% ownership interest in all its French assets. European gas
prices have remained in the $8-$9/mcf range over the past year contrary to
depressed North American natural gas prices.


Gallic is an international oil and gas company with assets in France and
Australia. Current operations are focused on France and in particular the
Aquitaine Basin where the Company holds approximately 320,000 net acres of
exploration lands. The Company holds acreage in the prospective Canning Basin in
Australia.


IMPORTANT INFORMATION REGARDING FORWARD-LOOKING STATEMENTS 

Certain statements in this news release constitute forward-looking information.
Forward-looking statements are often, but not always, identified by the use of
words such as "seek", "anticipate", "plan", "continue", "estimate", "expect",
"may", "will", "intend", "could", "might", "should", "believe", "schedule" and
similar expressions. Forward-looking statements are based upon the opinions and
expectations of Gallic as at the effective date of such statements and, in
certain cases, information received from or disseminated by third parties.
Although the Company believes that the expectations reflected in such
forward-looking statements are based upon reasonable assumptions and that
information received from or disseminated by third parties is reliable, it can
give no assurance that those expectations will prove to have been correct.
Forward-looking statements are subject to certain risks and uncertainties (known
and unknown) that could cause actual outcomes to differ materially from those
anticipated or implied. These factors include, but are not limited to, such
things as general economic conditions in Canada, France and elsewhere;
volatility of prices for oil and gas; commodity supply and demand; fluctuations
in currency and interest rates; inherent risks associated with the exploration
and development of oil and gas properties; ultimate recoverability of reserves;
production, timing, results and costs of exploration and development activities;
political or civil unrest; availability of financial resources or third-party
financing; new laws (domestic or foreign); changes in administrative practices;
changes in exploration plans or budgets; and availability of personnel and
equipment. Accordingly, readers should not place undue reliance upon the
forward-looking statements contained in this news release and such
forward-looking statements should not be interpreted or regarded as guarantees
of future outcomes. 


The forward-looking statements of the Company contained in this news release are
expressly qualified, in their entirety, by this cautionary statement. Various
risks to which Gallic and its affiliates are exposed in the conduct of their
business are described in detail in the Company's Annual Information Form and
Management Discussion and Analysis for the year ended December 31, 2011, which
has been filed on SEDAR www.SEDAR.com. Subject to applicable securities laws,
the Company does not undertake any obligation to publicly revise the
forward-looking statements included in this news release to reflect subsequent
events or circumstances, except as required by law.