Anterra Energy Inc.
TSX VENTURE : AE.A
TSX VENTURE : AE.B

Anterra Energy Inc.

August 20, 2007 17:07 ET

Anterra Announces Second Quarter Results and Operations Update

CALGARY, ALBERTA--(Marketwire - Aug. 20, 2007) - Anterra Energy Inc. (TSX VENTURE:AE.A) (TSX VENTURE:AE.B) ("Anterra" or the "Company") today reported its financial and operating results for the three- and six-month periods ended June 30, 2007.

HIGHLIGHTS

- Record funds flow from operations of $453,767 for the quarter, up 175% from the second quarter 2006 and $753,497 for the first six months of the year, up 75 % from the prior year.

- Average oil and gas sales for the quarter were 260 boepd (65% light oil and 35% sweet gas).

- During the quarter, Anterra drilled two 100% interest oil wells at Breton, one 100% oil well at Frontier and acquired a 100% interest in a producing property at Sakwatamau, adding a combined 100 boepd of oil production, which will be reflected in the third quarter.

- June 25, 2007 announcement of bought-deal private placement "flow through" financing by way of the issuance of 3,518,332 Class A shares at a price of $0.60 per share for gross proceeds of $2.111 million. The financing was fully subscribed and closed subsequent to the end of the second quarter.

- Completion of the amalgamation of Resolve Energy Inc. and Anterra Corporation on May 1, 2007.

- Negotiation of $5.75 million credit facility and $1.5 million development facility with a major Canadian chartered bank.

"We exit the second quarter, poised to embark on the most exciting drilling program in our history," said Owen Pinnell, Chairman and Chief Executive Officer of Anterra. "We are about to commence drilling at Judy Creek, targeting oil from the Swan Hills reef rim. This project follows on the recent success at our Breton property with the drilling of the two 100%-interest Belly River oil wells now producing a combined 60 boepd. As this is the first quarter of post-merger operations, the impact of our business plan will become more evident in the third and fourth quarters. Subsequent to quarter-end, we completed a $2,111,000 private placement whose proceeds have been applied to working capital, allowing us to substantially complete our $10 million CAPEX program for the year. Our bank credit facility of $5.75 million with an additional $1.5 million facility in reserve is available for future development projects. Going forward, we will continue to execute on our defined business plan for growth and development in our core areas, combining high impact exploration along the Devonian reef edge in central Alberta with lower risk development and exploitation," said Mr. Pinnell.



FINANCIAL SUMMARY

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Three Months Three Months Six Months Six Months
June 30, June 30, June 30, June 30,
2007 2006 2007 2006
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Oil and Gas Production
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Revenue 1,443,991 1,271,574 2,602,687 2,553,514
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Royalties (113,930) (111,061) (213,871) (257,425)
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Gross overriding
royalties 3,499 1,517 3,499 5,281
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Net revenue 1,333,560 1,162,030 2,392,315 2,301,370
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Operating costs 497,728 553,143 973,703 953,685
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Oil and gas operating
margin 835,832 608,887 1,418,612 1,347,685
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Midstream Processing
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Revenue 244,796 168,401 540,703 398,690
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Operating costs 190,048 209,532 367,973 471,585
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Midstream operating
margin 54,748 (41,131) 172,730 (72,895)
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Other revenue - - - -
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Intersegment revenue
and cost (46,080) (48,773) (95,041) (114,226)
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Total Net Revenue 1,532,276 1,281,658 2,837,977 2,585,834
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Total Operating Costs 641,696 713,902 1,246,635 1,311,044
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Total Operating Margin 890,580 567,756 1,591,342 1,274,790
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Expenses
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General and
administration 371,585 347,120 690,349 664,515
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Stock compensation 76,462 1,880 87,126 49,563
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Interest 65,228 41,171 147,496 82,591
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Depletion, depreciation,
accretion 471,358 286,626 834,984 683,497
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Total Expenses 984,633 676,797 1,759,955 1,480,166
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Net Profit (Loss)
Before Tax (94,053) (109,041) (168,613) (205,376)
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Provision For Taxes (5,926) (6,480) (32,112) (29,792)
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Net Profit (Loss) (88,127) (102,561) (136,501) (175,584)
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Earnings per Class
A Share
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Basic (0.004) (0.004) (0.007) (0.007)
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Fully Diluted (0.004) (0.004) (0.007) (0.007)
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Weighted Average
Number of Shares In
Thousands 20,553,000 25,733,000 18,244,000 25,733,000
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Funds Flow From
Operations 453,767 172,283 753,497 431,968
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Funds Flow Per Class
A Share 0.022 0.007 0.041 0.017
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OPERATIONS REVIEW

Anterra's 2007, $10 million capital program commenced in early May, following the completion of the Anterra Resolve merger transaction. Despite weather related delays, the Company executed an aggressive second quarter program, drilling three 100% working-interest oil wells and completing and interpreting its $1 million 3-D program. The first oil well at Frontier was placed on production in early June, while the two Breton oil wells were placed on production in July, adding a combined 100 bopd of production. Momentum continued into the third quarter with considerable progress being made on permitting and surface lease acquisition in both the Judy Creek and Macleod areas.

To facilitate efficient operations, Anterra focuses its activities in core areas where it can control the land base and infrastructure. At Breton, following the recent drilling success, the Company produces 275 boepd, owns over 5,000 acres of contiguous lands and controls the infrastructure. This will be the model that management will strive to emulate at both Judy Creek and Frontier where operations remain at an early stage. Undeveloped land is critical to the Company's ongoing growth and development in its core areas and land inventories are being added to on a regular basis to enable continuous exploitation of play types and geological trends, greatly reducing overall exploration risk.

CORE AREA REVIEW

Breton

During the second quarter, Anterra continued development of its 100% working interest property at Breton with the drilling and completion of two oil wells and the commissioning of the first phase of the secondary recovery scheme. Both new wells encountered 11 meters of oil pay and are jointly producing 60 bopd of light oil, with this rate expected to increase as reservoir pressure builds from the effects of the enhanced secondary recovery scheme. Over the balance of the year, the Company plans to convert its dual completed LSD11-23 oil and gas well into a gas well and re-drill the basal Belly River for oil. These activities are expected to add a further 100 boepd of oil and gas production, increasing Breton oil and gas production from 275 boepd to 375 boepd.

Southeast Alberta and southwest Saskatchewan

During the second quarter, Anterra drilled its first 100% working-interest Shaunavon oil well at Frontier in southwest Saskatchewan and the well has stabilized at 20 bopd. The Company continues to acquire land and has now accumulated 1,760 acres over this prospect with six more locations to drill. Although the wells are not large producers, reserves per location average 75,000 barrels and this long-life production can be improved with a water flood scheme and the area is accessible throughout the year. One new well at LSD 16-7 and a re-entry at LSD 8-24 are scheduled for August. At Suffield in southeast Alberta, the Company has farmed out a 50% interest in its LSD 4-1 Sunburst/Pekisko well which is also scheduled for drilling in August. Production from the area is presently 60 bopd.

Judy Creek Area

During the second quarter, Anterra acquired 25 bopd of pipeline connected oil production at Sakwatamau near Judy Creek. The exploitation and development of this property includes a Shunda exploration well which will be drilled during the fourth quarter. Anterra has now accumulated 5,024 net acres over its Judy Creek high-impact Devonian reef prospect and has completed and interpreted a $1 million 3-D seismic program. The Company has identified four drilling locations and is actively acquiring surface leases and well licences. It expects to drill two Swan Hill's reef light oil tests, the first at LSD 9-19, by the end of September. The Swan Hills reef can be a prolific zone, and this high-impact prospect has the potential to substantially increase company reserves and production.

MacLeod and Crooked Lake Area

The Swan Hills reef test well at MacLeod is Anterra's highest-impact project for 2007. The re-entry on this 160 BCF natural gas target is scheduled for the fourth quarter, subject to final approvals from regulatory bodies. Anterra is re-entering a cased well and deepening the well bore from 2,400 meters to 3,300 meters and has a 52.5% working interest in the project. At Crooked Lake, Anterra has acquired four sections of 100% lands and is presently developing its exploration plan for this property. This is a 2008 project that will require an extensive 3-D program and the purchase of additional lands over the prospect.

OUTLOOK

Anterra has positioned itself to take advantage of the positive business environment in the oil and gas sector. Although natural gas prices remain weak, Anterra is primarily an oil company and is benefiting from the strong price environment for this commodity.

The Company plans to continue growing its core areas while putting in place the projects that will be needed to drive growth in the future. Frontier will become a core area, with management presently developing a plan to acquire more land and to exploit the low-risk reserves in the region. Management is also pursuing several new prospects on Company lands at Breton and Sakwatamau, while continuing to pursue the development of high impact exploration projects along the Swan Hills reef edge.

Anterra's 2007 second quarter consolidated financial statements and related MD&A are available on Anterra's website at www.anterra.org as well as on the SEDAR website at www.sedar.com.

Funds flow from operations is not a recognized measure under Canadian generally accepted accounting principles (GAAP). However, management believes that funds flow from operations is a useful measure of financial performance. For the purposes of funds flow from operations calculations, funds flow is defined as "Funds flow from operations" before changes in non-cash operating working capital. Anterra's determination of funds flow from operations may not be comparable to that reported by other companies.

In this press release, the calculation of barrels of oil equivalent (boe) is calculated at a conversion rate of 6,000 cubic feet (mcf) of natural gas for one barrel (bbl) of oil based on an energy equivalency conversion method. Boes may be misleading particularly if used in isolation. A boe conversion ratio of 6 mcf : 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

Anterra Energy Inc. ("Anterra" or the "Company") is an emerging energy company with a balanced portfolio of high impact exploration and lower risk exploitation projects. Complementing this strong exploration and development focus, the Company owns and operates oil and gas production and associated fee-based midstream facilities in western Canada. Anterra is a public Canadian company listed on the TSX Venture Exchange under the symbols AE.A and AE.B. More information about Anterra is available on the internet at www.anterra.org.

This news release contains forward looking information related to the planned drilling program, production and operating costs. These statements are based on current expectations that involve a number of risks and uncertainties, which could cause actual results to differ from those anticipated. These risks include, but are not limited to, risks associated with the oil and gas industry (e.g. operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of estimates in relation to reserves, production and expenses; and health, safety and environmental risks). Due to the risks, uncertainties and assumptions inherent in forward-looking statements, prospective investors in the company's securities should not place undue reliance on these forward-looking statements.

26,360,606 Class A Shares

753,014 Class B Shares

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

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