Pearl Exploration and Production Ltd.

Pearl Exploration and Production Ltd.

May 19, 2006 16:30 ET

Pearl Settles Pan-Global Debt

CALGARY, ALBERTA--(CCNMatthews - May 19, 2006) - Pearl Exploration and Production Ltd. ("Pearl" or the "Company") (TSX VENTURE:PXX) is pleased to announce that it has negotiated a prepayment privilege in respect of a $5 million convertible debenture made by Pan-Global Energy Ltd. in June 2005. Pan-Global was acquired by Pearl on April 28, 2006.

Under the renegotiated payment terms, Pearl was permitted to prepay the debenture by paying the principal amount of $5 million plus $300,000 on account of accrued and unpaid interest and bonus and issuing 150,000 shares of Pearl. The issuance of the 150,000 shares was approved by the TSX Venture Exchange on May 17, 2006.

Pearl is a public company focused on delivering disciplined growth by establishing a North American portfolio of oil and gas projects with an emphasis on large resource opportunities. Additional information on Pearl is available on our website at:

Gary Guidry, President and CEO

Forward-looking statements: This document contains statements about expected or anticipated future events and financial results that are forward-looking in nature and, as a result, are subject to certain risks an uncertainties, such as general economic, market and business conditions, the regulatory process and actions, technical issues, new legislation, competitive and general economic factors and conditions, the uncertainties resulting from potential delays or changes in plans, the occurrence of unexpected events, and the Company's capability to execute and implement its future plans. Actual results may differ materially from those projected by management. For such statements, we claim the safe harbour for forward-looking statements within the meaning of the Private Securities Legislation Reform Act of 1995.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

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