Orleans Energy Ltd.

Orleans Energy Ltd.

November 23, 2009 16:37 ET

Orleans Energy Provides Corporate Update

CALGARY, ALBERTA--(Marketwire - Nov. 23, 2009) - Orleans Energy Ltd. ("Orleans" or the "Company") (TSX:OEX) is pleased to provide the following updates:

Drilling Operations

In late-October 2009, the Company successfully drilled and subsequently completed two (1.75 net working interest) horizontal Montney gas wells on its western Kaybob land block. The first well (4-15-60-19W5M - 100% working interest) was completed with multi-stage fracture technology as an eleven-stage fracture stimulation with an aggregate 198 tons of proppant sand being displaced along the 1,343 meter horizontal leg. The 4-15 well recently flowed liquids-rich gas over an 89 hour extended flow test period at a final gross raw test rate of 5.6 million cubic feet per day ("mmcf/d") or 933 barrels of oil equivalent per day ("boe/d"), with a flowing well head tubing pressure of 1,450 pounds per square inch ("psi"). The 4-15 well was brought on-stream on November 21, 2009 and is currently producing at a similar "flush" rate to its final flow test rate.

The second Kaybob well (75% working interest) was completed and stimulated with an eleven-interval hydraulic fracture encompassing 209 total tons of proppant sand being displaced along the 1,144 meter horizontal leg. This well recently flowed gas over a 69 hour extended flow test period at a final gross raw test rate of approximately 5.5 mmcf/d or 917 boe/d (687 boe/d net working interest), with a flowing well head tubing pressure of 1,420 psi. The well is presently shut-in for down hole pressure testing and the Company anticipates this well to be tied-in by mid-December 2009.

These two Kaybob wells represent the initial, successful application of horizontal drilling and multi-stage completion techniques on those respective sections of land, thus validating and enhancing the repeatable, scalable nature of the Company's Triassic Montney natural gas "resource play" at Kaybob, in addition to bolstering Orleans' reserves booking assignment and valuation. Orleans has regulatory approval to drill up to five horizontal wells per section across 25 (22.5 net working interest) of its 28 gross sections of land in Kaybob, thereby creating a drilling inventory of up to 100 horizontal locations. Since commencing horizontal drilling in October 2007, Orleans has drilled a total of 16 (14.1 net working interest) Montney horizontal wells at Kaybob, with a success rate of 94%.

At Waskahigan, to the northwest of Kaybob in West Central Alberta, the Company intends to commence field operations and spud on or about November 26, 2009 a 100% working interest Montney horizontal test (12-17-63-23W5M) on one of its eighteen (18) sections of contiguous land. The 12-17 well is programmed to be drilled with a total measured depth of 3,667 meters. Orleans has utilized its internally-developed technical and geological experience garnered with its Kaybob Montney development success to assist in identifying and growing its Montney-prospective land base in the Waskahigan area. Pending exploration success, Waskahigan area is expected to complement and significantly expand Orleans' currently large, "resource-style" drilling inventory.

Revised 2009 Capital Budget and Market Guidance

As a result of the flow-though share equity financing which closed on November 12, 2009, the Company announces an increase to its 2009 total capital expenditures budget to approximately $44 million. The revised 2009 capital investment program encompasses the drilling of a total of four (3.75 net) horizontal Montney wells at Kaybob and two (2.0 net) horizontal wells involving its new Montney exploration prospect at Waskahigan.

Notwithstanding the previously-disclosed disposition of the Company's non-core Medicine River property, Orleans' year-end 2009 guided exit production rate target is projected to remain unchanged at approximately 4,600 boe/d (assuming the aforementioned second Kaybob well is brought on-stream by year-end as planned). Projected average daily production for fiscal 2009 is forecasted to approximate 3,900 boe/d, a 7% reduction from the previously-established annual average daily forecasted level of 4,200 boe/d.

With respect to providing capital spending, production and financial guidance for 2010, Orleans is currently engaged in its budgeting phase and will look to provide such guidance in early 2010.

Orleans Energy Ltd. is a Calgary, Alberta-based emerging crude oil and natural gas company, with common shares trading on the Toronto Stock Exchange under the symbol "OEX". Orleans is a team of dedicated, experienced professionals focused on the creation of shareholder value via acquisition, exploration and development of crude oil and natural gas assets in Alberta, Canada.

The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions. These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in commodity prices and foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for oil and natural gas; liabilities inherent in oil and natural gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, of reserves, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry ; geological, technical, drilling and processing problems and other difficulties in producing petroleum reserves; and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits that the Company will derive from them. 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. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements.

In this news release, reserves and production data are commonly stated in barrels of oil equivalent ("boe") using a six to one conversion ratio when converting thousands of cubic feet of natural gas ("mcf") to barrels of oil ("bbl") and a one to one conversion ratio for natural gas liquids ("NGLs" or "ngls"). Such conversion may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf: 1 bbl is based on energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Any references in this news release to initial and/or final raw test or production rates and/or "flush" production rates are useful in confirming the presence of hydrocarbons, however, such rates are not determinative of the rates at which such wells will commence production and decline thereafter. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for the Company.

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