Questerre Energy Corporation
TSX : QEC
OSLO STOCK EXCHANGE : QEC

Questerre Energy Corporation

May 14, 2008 03:28 ET

Questerre Announces First Quarter Results

CALGARY, ALBERTA--(Marketwire - May 14, 2008) - Questerre Energy Corporation ("Questerre" or the "Company") (TSX:QEC)(OSLO:QEC) announced today its financial and operating results for the first quarter of 2008.

Michael Binnion, President and Chief Executive Officer of Questerre, commented, "The first quarter was eventful to say the least. The excitement surrounding the significant shale gas discovery on our Quebec acreage completely overshadowed the disappointment from the A-8 well at Beaver River. We had excellent drilling results with our newer projects in Antler and Greater Sierra. The higher quality reserves and improved netbacks coupled with higher prices translated into record cash flow for the quarter."

Highlights

- Significant Utica shale gas discovery in the St. Lawrence Lowlands, Quebec

- Excellent results from horizontal wells in Antler, Saskatchewan

- Successfully drilled two Jean Marie wells and acquired a 46 sq mile 3-D seismic survey in Greater Sierra, northeast British Columbia

- Tested non-commercial well at Beaver River Field

- Cash flow from operations increased to $3.94 million from $3.05 million in 2007

Cash flow from operations in 2008 grew to $3.94 million from $3.05 million in 2007. The increase reflects the higher commodity prices and improved operating netbacks of $37.08/boe in 2008, an increase of just over 50% from $24.57/boe in 2007. The Company reported a working capital deficit of $4.51 million at March 31, 2008 as compared to a surplus of $10.01 million at December 31, 2007.

Petroleum and natural gas revenue in the first quarter of 2008 was $7.23 million, a marginal decrease from $7.50 million in the preceding year. Higher oil production and commodity prices contributed to the strong revenue with average production of 1,274 boe/d during the quarter (2007: 1,702 boe/d). Net income of $1.47 million (2007: $0.48 million) for the quarter is primarily due to a future tax recovery of 2.25 million (2007: nil).

Questerre Energy Corporation is a Calgary-based independent resource company actively engaged in the exploration, development and acquisition of high-impact exploration and development oil and gas projects in Canada.

This news release contains forward-looking information. Implicit in this information are assumptions regarding commodity pricing, production, royalties and expenses, that, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. These forward-looking statements are based on certain assumptions that involve a number of risks and uncertainties and are not guarantees of future performance. Actual results could differ materially as a result of changes in the Company's plans, commodity prices, equipment availability, general economic, market, regulatory and business conditions as well as production, development and operating performance and other risks associated with oil and gas operations. There is no guarantee made by the Company that the actual results achieved will be the same as those forecasted herein.

Barrel of oil equivalent ("boe") amounts may be misleading, particularly if used in isolation. A boe conversion ratio has been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel and is based on an energy equivalent conversion method application at the burner tip and does not necessarily represent an economic value equivalent at the wellhead.

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