Compass Petroleum Ltd.

Compass Petroleum Ltd.
Sun Red Capital Corporation

May 21, 2010 12:26 ET

Compass Petroleum Ltd. and Sun Red Capital Corporation Announce Completion of Amalgamation

CALGARY, ALBERTA--(Marketwire - May 21, 2010) -

Not for dissemination in the United States or through U.S. newswires. The securities noted in this News Release have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an exemption from the registration requirements. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

Compass Petroleum Ltd. ("Compass") and Sun Red Capital Corporation ("Sun Red") are pleased to announce the successful completion of the previously announced amalgamation (the "Amalgamation") of Sun Red and Compass Acquisition Corp. ("AcquisitionCo"), a wholly-owned subsidiary of Compass. The Amalgamation was approved at the special meeting of Sun Red shareholders held on May 21, 2010 and constitutes Sun Red's "qualifying transaction" under the rules of the TSX Venture Exchange. Upon completion of the Amalgamation, each Sun Red shareholder received one common share of Compass ("Compass Shares") for each forty Sun Red common shares ("Sun Red Shares") held.

Further particulars of the Amalgamation are set out in the amended and restated amalgamation agreement entered into between Sun Red, Compass and AcquisitionCo on March 26, 2010 (the "Amalgamation Agreement"). Information concerning the Amalgamation and the Amalgamation Agreement is included in the information circular and proxy statement of Sun Red, dated April 21, 2010 (the "Circular"), a copy of which is available on SEDAR under Compass' profile at

In connection with the Amalgamation, a total of 7,882,911 Compass Shares were also issued to the former holders of subscription receipts of AcquisitionCo, which were privately placed on May 14, 2010, for total gross proceeds of $10,641,930, (the "Offering"). Raymond James Ltd. ("Raymond James") acted as sole agent of Compass for the Offering. Compass has agreed with Raymond James that it will use the net proceeds of the Offering to fund the development of Compass' west central Saskatchewan core area and for general corporate purposes.

The Compass Shares have been conditionally approved for listing on the TSX Venture Exchange under the trading symbol "CPO". The TSX Venture Exchange has indicated that it expects to issue a bulletin with respect to the date of commencement of trading of the Compass Shares by May 26, 2010. The Sun Red Shares will continue to be halted from trading and will be de-listed from the TSX Venture Exchange upon the commencement of trading of the Compass Shares. After giving effect to the Amalgamation and the Offering, there are approximately 32,023,519 Compass Shares issued and outstanding (calculated on a non-diluted basis).

Raymond James acted as exclusive financial advisor to Compass.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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