Blugrass Announces Effectiveness of Reverse Stock Split

DALLAS, May 16, 2011 /PRNewswire/ -- Blugrass Energy Inc. (OTC.BB: BLUG - News), currently doing business as Rio Grande Petroleum Inc., today announced that the Company received approval from the Financial Industry Regulatory Authority ("FINRA"), clearing the 5-to-1 reverse stock split previously approved by the Board of Directors and announced on March 18, 2011.

According to FINRA's approval, the reverse split will take effect at the open of business on May 17, 2011.  On that effective date, the Company's trading symbol will be changed from "BLUG" to "BLUGD" for 20 business days, after which the Company's trading symbol will revert to BLUG.  The Company's common stock will trade under a new CUSIP number, 09623H209.

As a result of the reverse split, the number of authorized shares of the Company's common stock has been reduced, from 500,000,000 shares to 100,000,000 shares.  Also as a result of the reverse split, each five shares of the Company's common stock issued and outstanding on the effective date will represent one share of the Company's common stock.  Fractional shares existing as a result of the reverse split will be rounded up to the nearest whole share.

All records of the Company's transfer agent, Holladay Stock Transfer, will be updated to give effect to the reverse split.  Holladay Stock Transfer will provide instructions to stockholders relating to the issuance of book-entry evidence of ownership to give effect to the reverse stock split, and instructions as to the issuance of new stock certificates.  Stockholders whose certificates are held in "street name" or on deposit with their brokerage firm, as part of the DTC system, will be automatically adjusted on the same basis.

The reverse stock split is intended to increase the per share trading price of the Company's common stock, which should make it more attractive to a broader range of institutional and other investors. 

We invite you to visit the company's website at www.riograndepetroleum.com.

FORWARD LOOKING STATEMENTS SAFE HARBOR

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  Forward-looking statements give our current expectations or forecasts of future events. They include our plans to drill oil and gas wells on the lease lands in a search for economically recoverable reserves.  Actual results could differ materially as a result of a variety of risks and uncertainties.  See the description of risks related to our business in the documents that the company files with the SEC on Forms 10-K, 10-Q and 8-K.  We caution you not to place undue reliance on our forward-looking statements, which speak only as of the date of this news release, and we undertake no obligation to update this information.

Further information will be available on the company's website, where the company will routinely post announcements, updates, events, investor information and presentations, and all recent press releases.

SOURCE Blugrass Energy Inc.