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Press release from Marketwire

Savanna Energy Services Corp. Expands 2011 Capital Program

Thursday, June 02, 2011

Savanna Energy Services Corp. Expands 2011 Capital Program11:23 EDT Thursday, June 02, 2011CALGARY, ALBERTA--(Marketwire - June 2, 2011) - Savanna Energy Services Corp. ("Savanna") (TSX:SVY)is pleased to announce expansion of its 2011 and 2012 capital program. In the face of substantial, sustainable demand, the Company has determined to add incremental capital to its 2011 capital budget as follows: Approved EstimatedDescription Capital Delivery----------------------------------------------------------------------------2x TDS 3000 Drilling Rigs $12.0 million Q1, 2012 $21.6 million 2H, 2011 (6)12x Top Drives 1H, 2012 (6)3 Service Rigs (2 U.S., 1 Canada) $5.0 million 2H, 2011 1 Conventional Double Retrofit to 3600 M capacity $5.0 million 2H, 2011 3 Service Rig retrofits $4.0 million Q3, 2011 Rental fleet expansion $5.0 million 2H, 2011 Additional drillpipe and support equipment $2.0 million 2H, 2011 Field shop expansion $1.0 million Q3, 2011 ----------------------------------------------------------------------------Total $53.6 million Excluding acquisitions, total committed capital for our 2011 expansion (including 2010 carryover) now exceeds $165 million, with the estimated 2011 cash outlay approximating $150 million. Expansion of the TDS3000 rollout is in response to the very strong demand for this highly efficient rig in both Canada and the United States. The two incremental rigs noted above are not contracted, however, there are contracts in place for six of the TDS3000 rigs (4 now in operation), and based on discussions with customers, we fully expect the remaining four newbuilds will be contracted before completion.Similarly, there are customer commitments to fully utilize the top drives being ordered, with Savanna presently operating four rental top drives to satisfy customer demand. Upon taking delivery of the 12 top drives, Savanna will have over 80% of our drilling fleet so equipped, one of the highest ratios in the industry. Strong commitment to horizontal drilling by our customers, and clear operating advantages from utilizing top drives in these wells, are driving substantial customer demand for this technology.Further expansion and commitment to Savanna's well servicing capacity are reflective of ongoing demand for workover rigs in our North Dakota base. The expansion also includes completion of a workover rig under construction in Performance Well Services at the time of its acquisition.Finally, we have determined to upgrade one of our two remaining sub-3000 meter conventional double drilling rigs to 3600 meter capacity. In addition to enhancing its hookload and horsepower, we will be expanding its pump capacity and adding top drive capability. This platform has experienced very strong customer commitment to date, with equally strong expected demand going forward. This rig will be subject to a term contract on completion.Upon completion of this expanded capital investment program along with prior capital commitments, Savanna's combined workover and drilling fleet in Canada, the United States and Australia will reflect the following:Drilling ----------------------------------------------------------------------------Conventional (excluding TDS3000) 54 rigsTDS3000 10 rigsHybrid - CT1500 24 rigsHybrid - CT2200 8 rigs Hybrid - Australia 4 rigs Coring/Surface Setting 5 rigs ---------------------------------------------------------------------------- 105 rigs Well Servicing ----------------------------------------------------------------------------Mobile Singles 49 rigs Mobile Doubles 56 rigs ---------------------------------------------------------------------------- 105 rigs (i)(i) Including 17 rigs acquired via acquisitions of Silverstar Well Servicing expected to close on or about July 7, 2011.Savanna is a Canadian-based drilling and well servicing provider with operations in Canada, the United States and Australia, focused on providing fit-for-purpose equipment and technologies.Cautionary Statement Regarding Forward-Looking Information and StatementsCertain statements and information contained in this press release may constitute forward-looking information within the meaning of applicable Canadian securities legislation and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. These statements are based on certain assumptions and analysis made by Savanna in light of its experience as well as other factors it believes are appropriate in the circumstances. However, whether actual results or events will conform to Savanna's expectations and predictions is subject to a number of known and unknown risks and uncertainties which could cause actual results and events to differ materially from Savanna's expectations. Consequently, all of the forward-looking information and statements made in this press release are qualified by this cautionary statement and there can be no assurance that the actual results or events anticipated by Savanna will be realized or, even if substantially realized, that they will have the expected effects on Savanna or its business or operations. Except as may be required by law, Savanna assumes no obligation to update publicly any such forward looking information and statements, whether as a result of new information, future events, or otherwise.U.S. DisclaimerThis news release does not constitute an offer to sell of the solicitation of an offer to buy any securities within the United States. The securities to be offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act or other laws.FOR FURTHER INFORMATION PLEASE CONTACT: Ken MullenSavanna Energy Services Corp.President and CEO(403) 503-9990(403) 267-6749 (FAX)ORDwayne LaMontagneSavanna Energy Services Corp.Executive Vice President & Chief Development Officer(403) 503-9990(403) 267-6749 (FAX)