Canacol Energy Ltd.
TSX VENTURE : CNE

Canacol Energy Ltd.

September 17, 2009 12:27 ET

Canacol Energy Ltd. Provides Update on Operated Development Drilling Program in Colombia

CALGARY, ALBERTA--(Marketwire - Sept. 17, 2009) - Canacol Energy Ltd. (TSX VENTURE:CNE) ("Canacol" or the "Corporation") is pleased to provide an update of its development drilling program in its operated producing oil fields in Colombia. The Corporation has a 100% operated working interest in the Rancho Hermoso field and a 60% working interest in the Entrerrios field, both located in the Llanos Basin of Colombia. Through to the end of 2009, the Corporation has plans to drill 2 new development wells and work over 1 existing well in the Rancho Hermoso field, and drill 1 new development well and work over 2 existing producing wells in the Entrerrios field.

The Corporation commenced drilling operations on the Rancho Hermoso 3A well on August 18, 2009, which reached a total depth of 9,333 feet measured depth in the Mirador reservoir target. The well encountered 24 feet of net interpreted oil pay within the Mirador reservoir, which was perforated from 9,118 to 9,133 feet measured depth. The Corporation is currently tying the well into the permanent existing production facility, and it is anticipated that the well will be on full production within 2 weeks.

The Saxon 126 drilling rig is currently being mobilized to the Entrerrios field to commence the drilling of the Entrerrios 5 well, which is anticipated to spud in the last week of September. The objective of the Entrerrios 5 well is the Cretaceous Ubaque reservoir. The drilling rig will then be mobilized back to the Rancho Hermoso field in early November to commence drilling of the Rancho Hermoso 5 well. The objective of the Rancho Hermoso 5 well is the Mirador reservoir.

Canacol is a Canadian based international oil and gas corporation with operations in Colombia, Brazil and Guyana. Canacol is publicly traded on TSX Venture Exchange (TSX VENTURE:CNE). The Corporation's public filings may be found at www.sedar.com.

This press release contains certain forward-looking statements within the meaning of applicable securities law. Forward-looking statements are frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur, including without limitation statements relating to estimated production rates from the Corporation's properties and intended work programs and associated timelines. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. The Corporation cannot assure that actual results will be consistent with these forward looking statements. They are made as of the date hereof and are subject to change and the Corporation assumes no obligation to revise or update them to reflect new circumstances, except as required by law. Prospective investors should not place undue reliance on forward looking statements. These factors include the inherent risks involved in the exploration for and development of crude oil and natural gas properties, the uncertainties involved in interpreting drilling results and other geological and geophysical data, fluctuating energy prices, the possibility of cost overruns or unanticipated costs or delays and other uncertainties associated with the oil and gas industry. Other risk factors could include risks associated with negotiating with foreign governments as well as country risk associated with conducting international activities, and other factors, many of which are beyond the control of the Corporation.

A barrel of oil equivalent (boe) is derived by converting gas to oil in the ratio of six thousand cubic feet of gas to oil and may be misleading, particularly if used in isolation. A boe conversion is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead, especially in various international jurisdictions.

Neither 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.

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