Questerre Energy Corporation

Questerre Energy Corporation

May 12, 2005 09:15 ET

Questerre Announces First Quarter Results

CALGARY, ALBERTA--(CCNMatthews - May 12, 2005) - Questerre Energy Corporation (TSX:QEC) ("Questerre" or the "Company") reported today on its financial and operating results for the first quarter of 2005.

The Company reported revenue of $461,000 for the three months ended March 31, 2005 as compared to revenue of $65,000 for the same period in 2005. Cash flow from operations for the first quarter improved from a loss of $226,000 in 2004 to a loss of $10,000 in 2005.

The Company participated in the drilling and completion of five wells in Alberta during the quarter. Four wells (1.8 net) were cased as oil and gas producers and one well (0.3 net) was dry and abandoned for a success rate of 80%. Three of the four wells were completed and tested for stable initial flow rates. The remaining well will be completed and tested after spring break-up.

In aggregate, the three tested wells flowed over 400 boe per day with an estimated 170 boe per day net to Questerre's interest. The Company anticipates that production from one of these wells could be improved and it will be re-stimulated and re-tested during the second quarter of 2005. In conjunction with the operator, Questerre is developing plans for facilities and pipeline tie-ins.

Participation in these wells earned Questerre an interest in 8 sections of land (3.8 net). Based on the success of the winter drilling program, the Company is currently evaluating additional acreage for further drilling this summer. The Company also acquired two sections in the Westlock area of Alberta prospective for shallow natural gas. Drilling is expected to commence on these lands this quarter.

Michael Binnion, Chief Executive Officer, commented, "I am very pleased with our drilling results in the first quarter. Based on our growing land position and prospect inventory, we are maintaining our target exit rate of 500 boe per day for 2005."

Questerre Energy Corporation is a Calgary-based independent resource company actively engaged in the exploration for and development, production and acquisition of large-scale exploration and development projects in Canada.

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