Cobalt Energy Ltd.
TSX VENTURE : CB.A
TSX VENTURE : CB.B

Cobalt Energy Ltd.

December 17, 2008 17:32 ET

Cobalt Announces Revision to Previously Announced Financing

CALGARY, ALBERTA--(Marketwire - Dec. 17, 2008) -

NOT FOR DISTRIBUTION TO US NEWSWIRE SERVICES FOR DISSEMINATION IN THE UNITED STATES.

Cobalt Energy Ltd. ("Cobalt" or the "Company") (TSX VENTURE:CB.A) (TSX VENTURE:CB.B) announces today it has amended the proposed financing previously announced on December 1, 2008.

The revised financing provides that Cobalt intends to issue by way of a private placement up to 2,143,000 units of the Company (the "Units") on a commercially reasonable efforts basis, at a price of $0.35 per Unit for gross proceeds of up to approximately $750,000 ("Offering"). Each Unit is comprised of one (1) flow-through Class A Share and one (1) non-transferable Share purchase warrant (the "Warrants"). Each Warrant will entitle the holder to acquire an additional non-flow-through Class A Share at an exercise price of $0.40 for a period of twelve (12) months following the closing date of the Offering.

The private placement will be led by Wolverton Capital Markets, a division of Wolverton Securities Ltd. Proceeds from the Offering will be used to incur qualifying expenditures which will be renounced in favour of the subscribers for the 2008 taxation year.

Closing of the Offering is expected to occur on or about December 22, 2008, and is subject to the receipt of all requisite regulatory and stock exchange approvals. The issued shares will be subject to a four month hold period from the date of closing.

Cobalt participates in the exploration, development and production of conventional crude oil and natural gas reserves in western Canada. The Company's strategy is to build shareholder value through selective acquisitions, exploitation, and exploration and development drilling.

Reader Advisory - This news release contains certain forward-looking statements, which include assumptions with respect to funds from financing and use of capital. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. All such forward looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control. Such risks and uncertainties include, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, tax treatment (including royalties), inability to retain drilling rigs and other services, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, the impact of general economic conditions in Canada, the United States and overseas, 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, increased competition, the lack of availability of qualified personnel or management, fluctuations in foreign exchange or interest rates, stock market volatility and market valuations of companies with respect to announced transactions and the final valuations thereof, and obtaining required approvals of regulatory authorities. The Company's actual results, performance or achievements could differ materially from those expressed in, or implied by, these 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 so, what benefits, including the amount of proceeds, that the Company will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive. All subsequent forward-looking statements, whether written or oral, attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws. BOE or boe/d may be misleading particularly if used in isolation. A BOE conversion of 6mcf:1bbl is based as an energy equivalency conversion method primarily applicable at the burner tip and does not necessarily represent a value equivalency at the well head.

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

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