G3 Exploration Regulatory News (G3E)

10 September 2010

GREEN DRAGON GAS LTD

("Green Dragon" or "the Company")

DIRECTOR'S INTEREST

Green Dragon Gas Ltd. (AIM:GDG), one of the largest independent companies involved in the production of CBM gas and the distribution and sale of wholesale gas in China, announces that it was notified today that Randeep S. Grewal, Chairman and CEO of the Company, has implemented a structural change to his interests in the share capital of the Company, as set out below.

Green Dragon Gas (Holdings) Limited has today agreed to transfer (for no consideration) 10,500,000 ordinary shares in the Company ("Ordinary Shares") to GDGH II Ltd. GDGH II Ltd is a wholly-owned subsidiary of Green Dragon Gas (Holdings) Limited which is interested in a total of 88,000,000 Ordinary Shares (representing 73.0% of the Company's issued share capital), which, following this transfer, holds the Ordinary Shares as follows:

- Green Dragon Gas (Holdings) Limited itself holds 74,700,000 Ordinary Shares;

- GDGH Ltd., also a wholly owned subsidiary of Green Dragon Gas (Holdings) Limited, holds 2,800,000 Ordinary Shares; and

- GDGH II Ltd, holds 10,500,000 Ordinary Shares.

As previously announced, Mr Grewal is beneficially interested via a family trust in the Ordinary Shares held by Green Dragon Gas (Holdings) Limited. In addition to his interest in the Ordinary Shares held through Green Dragon Gas (Holdings) Limited, Mr Grewal directly owns 904,717 Ordinary Shares (representing 0.8% of the Company's issued share capital).

The transfer set out above does not change Mr Grewal's ultimate beneficial holding in the Company.

For further information on the Company and its activities, please refer to the website at www.greendragongas.com or contact: