Groundstar Resources Limited Announces Closing of Private Placement Financing and Operations Update

Groundstar Resources Ltd.

Metals & Mining

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Groundstar Resources Limited Announces Closing of Private Placement Financing and Operations Update

Calgary, December 23, 2013 -Groundstar Resources Limited (TSXV: GSA US: GRDSF symbol) (the "Company") is pleased to announce that it has closed on its previously announced private placement financing of units and common shares in the capital of the Corporation issued on a "flow-through" basis ("Flow-Through Shares") pursuant to the provisions of the Income Tax Act (Canada). The Company issued and closed approximately 7.1 million Flow-Through Shares and 0.3 million common shares for aggregate gross proceeds of approximately $1.5 million. The Company received additional demand by subscribers wishing to purchase Flow-Through Shares that it amended the allocation such that up to 8.5 million shares may be issued pursuant to the financings. The Company expects an additional closing of the offering prior to year end and may issue up to 0.5 million common share units and up to 0.6 million Flow-Through Shares such that now up to $1.7 million in total gross proceeds may be subscribed. A syndicate of agents, including PI Financial Corp. and Canaccord Genuity Corp. as co-lead agents, were involved with the offering and were issued a total of approximately 0.45 million agents' warrants, exercisable for a period of 18 months from the closing date at a price of $0.18 per share. The Company expects to use the net proceeds from the offering to further the exploration and development activities of its oil and gas properties. The proceeds received by the Company from the sale of the Flow-Through Shares will be used to incur eligible Canadian Development Expenses ("CDE") and Canadian Exploration Expenses ("CEE") which will be renounced in favour of subscribers for the 2013 taxation year. The securities were issued on a private placement basis and are subject to a statutory hold period of four months and a day from the closing date of the offering, such hold period to expire on April 23, 2014. Jordan Capital Markets Inc. also participated in the financing.

Based upon Groundstar's recent drilling success in Saskatchewan, the Company is pleased to announce the licensing of a follow-up drilling location at 4-13-45-26 W3. The location, targeting additional potential in the Manville formation, is expected to drill early in the New Year. As well, Groundstar has expanded its agreement with the mid-sized oil and gas producer with extensive land and proprietary seismic data base in the area, and expects that recent funding proceeds may be allocated to development drilling. At it's Viking, light oil opportunity, the Company is completing an Authority For Expenditure relevant to the drilling of a vertical well which is scheduled as part of the 2014 work program.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

About Groundstar Resources Limited

Incorporated in 1968, Groundstar Resources Limited is a diversified publicly traded oil and gas company with oil production and exposure to 7.3 million gross acres of resource assets. The Company is actively growing a portfolio targeting producing oil and gas assets with development opportunities and exploration upside. The Company's current portfolio of assets provides both near term and longer term potential. Groundstar is quoted and trades under the ticker symbol "GSA" in Canada and "GRDSF" in the United States.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This press release contains forward-looking statements within the meaning of applicable securities laws, including expectations regarding the anticipated closing of a second tranche of the offering, the gross proceeds expected to be received in connection therewith and the anticipated use of proceeds from both offerings. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. These risks include, but are not limited to: the risks associated with the oil and gas industry (e.g. operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve and resource estimates; the uncertainty of estimates and projections relating to production, costs and expenses and health, safety and environmental risks), commodity price and exchange rate fluctuation, uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures and uncertainties regarding whether regulatory approval for the offerings will be received and if received, on the timelines expected, as well as the intended use of the net proceeds of the offerings. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement. The forward-looking statements contained in this press release are made as of the date hereof and the Company undertakes no obligations to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.


Contact Information: Contact Information:

Groundstar Resources Limited, Suite 2300, 144 4th Avenue SW, Calgary, Alberta T2P 3N4

 |Groundstar Resources Limited  |     |
 |Chad Dust  403 608 6505 or 403|Tyron Pfeifer  403 614 9902     |
 |265 2549                      |[email protected]|
 |[email protected] |                                |
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