Questerre Announces Preliminary Year-End Results

CALGARY, ALBERTA--(Marketwire - Feb. 24, 2012) -

NOT FOR DISTRIBUTION ON U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Questerre Energy Corporation ("Questerre" or the "Company") (TSX,OSE:QEC) reported today on its preliminary financial and operating results for the year ended December 31, 2011.

Michael Binnion, President and Chief Executive Officer, commented, "We realigned our strategy in 2011. With development of our Utica shale gas discovery deferred during the environmental assessment in Quebec, we looked for new opportunities in unconventional oil to create value for our shareholders. We also committed to grow our conventional assets to create a reserve of capital. I am pleased to report we made excellent progress on both of these fronts during the year."

2011 Highlights

• Executed new oil shale strategy through Letter of Intent with Red Leaf Resources and acquisition of 100,000 net acres
• Grew conventional asset base with successful light oil drilling program in Antler, Saskatchewan
• Exploration licenses in St. Lawrence Lowlands, Quebec extended by up to three years to 2021 during strategic environmental assessment for shale gas development
• Increasing oil production leveraged higher prices and generated cash flow from operations of $10.06 million with average daily production of 646 boe/d
• Grew NPV-10 for our proved and probable reserves to $102 million
• Maintained financial strength with over $104 million in positive working capital and no debt

Mr. Binnion added, "Our proposed strategic investment in oil shale gives us the potential to benefit from another major shift in energy markets. With our portfolio of oil shale assets and the right to license Red Leaf's process, we are looking to add significant oil resources to complement our gas resources in Quebec. We expect this investment to close before the end of the first quarter of this year."

He further commented, "While we move the oil shale assets from assessment and piloting to commercial development over the next two to three years, our conventional assets and cash will provide a base of capital in the interim. During the year we grew our light oil assets in Antler through a successful drilling program and a property acquisition. We invested $40.77 million in our assets, approximately 80% in Antler, and added over 850,000 barrels in light oil reserves. The value of our proved and probable reserves on an NPV-10 basis grew from $67 million to $102 million with oil and liquids accounting for 92% of the reserve base. With spring breakup approaching, we are operating with one rig and will re-contract drilling and completion equipment this summer. We plan to grow production through a combination of continued drilling and a secondary recovery scheme at Antler as well as new projects like our liquids-rich Montney prospect. We are targeting production of 1,500 - 2,000 boe/d by 2013 to coincide with the environmental process in Quebec."

For the year ended December 31, 2011, the Company reported cash flow from operations of $10.06 million as compared to $4.74 million for the prior year. An increased proportion of light oil from Antler and higher oil prices were largely responsible for the increase in cash flow over the prior year. Questerre's production averaged 646 boe/d (2010: 619 boe/d) with oil and liquids accounting for 76% (2010: 53%) of the product mix. As at December 31, 2011, the Company reported a working capital surplus of $104.48 million (2010: $136.08 million).

The Company also reported on the evaluation of its proved and probable reserves as at December 31, 2011. The report was prepared in accordance with the COGE Handbook by McDaniel & Associates with an effective date of December 31, 2011.

In accordance with the requirements of National Instrument 51-101, Standards of Disclosure for Oil and Gas Activities of the Canadian Securities Administrators, the Company anticipates filing its Annual Information Form that includes more detailed disclosure and reports relating to petroleum and natural gas activities for the 2011 fiscal year at the end of March 2012.

SUMMARY OF OIL AND GAS RESERVES

as of December 31, 2011

FORECAST PRICES AND COSTS

	LIGHT AND MEDIUM OIL				NATURAL GAS				NATURAL GAS LIQUIDS
RESERVES CATEGORY	Gross (Mbbl	)	Net (Mbbl	)	Gross (MMcf	)	Net (MMcf	)	Gross (Mbbl	)	Net (Mbbl	)
Proved
Developed Producing	1,125.5		1,066.3		948.8		853.2		9.0		5.5
Developed Non-Producing	43.3		42.4		-		-		-		-
Undeveloped	374.8		358.1		-		-		-		-
Total Proved	1,543.6		1,466.8		948.8		853.2		9.0		5.5
Probable	828.8		778.0		269.8		240.4		2.6		1.5
Total Proved Plus Probable	2,372.4		2,244.8		1,218.6		1,093.6		11.6		7.0

SUMMARY NET PRESENT VALUES OF FUTURE NET REVENUE

as of December 31, 2011

FORECAST PRICES AND COSTS

		BEFORE INCOME TAXES DISCOUNTED AT (%/YEAR)										AFTER INCOME TAXES DISCOUNTED AT (%/YEAR)
RESERVES CATEGORY		0% (M$	)	5% (M$	)	10% (M$	)	15% (M$	)	20% (M$	)	0% (M$	)	5% (M$	)	10% (M$	)	15% (M$	)	20% (M$	)
Proved
Developed Producing		84,989.7		70,517.4		60,468.1		53,167.1		47,656.9		84,989.7		70,517.4		60,468.1		53,167.1		47,656.9
Developed Non-Producing		2,410.4		1,973.1		1,638.6		1,377.3		1,169.2		2,410.4		1,973.1		1,638.6		1,377.3		1,169.2
Undeveloped		11,520.0		8,151.6		5,613.6		3,666.9		2,149.1		11,520.0		8,151.6		5,613.6		3,666.9		2,149.1
Total Proved		98,920.1		80,642.1		67,720.3		58,211.3		50,975.2		98,920.1		80,642.1		67,720.3		58,211.3		50,975.2
Probable		66,720.1		46,276.5		34,381.5		26,880.8		21,830.6		61,235.3		43,279.8		32,678.7		25,879.3		21,223.7
Total Proved Plus Probable		165,640.2		129,918.6		102,101.8		85,092.1		72,805.8		160,155.4		123,921.9		100,399.0		84,090.6		72,198.9

SUMMARY OF PRICE FORECASTS
Year	2012		2013		2014		2015		2016		2017		2018		2019		2020
AECO Spot Price ($C/MMBtu)	3.50		4.20		4.70		5.10		5.55		5.90		6.25		6.45		6.70
Edmonton Light Crude Oil ($C/bbl)	99.00		99.00		101.50		102.30		103.20		104.20		105.10		106.00		106.90

The term "cash flow from operations" is a non-GAAP measure. Please see the reconciliation elsewhere in this press release.

Questerre Energy Corporation is an independent energy company focused on non-conventional oil and gas resources. The Company is currently developing a portfolio of oil shale assets in North America. It is also securing a social license to commercialize its Utica natural gas discovery in Quebec. The Company is underpinned by light oil assets and a strong balance sheet. Questerre is committed to the economic development of its resources in an environmentally conscious and socially responsible manner.

This media release contains certain statements which constitute forward-looking statements or information ("forward-looking statements"), including the investment in Red Leaf Resources Inc., development of oil shale assets, production forecasts and timing of future development in Quebec. Although Questerre believes that the expectations reflected in our forward-looking statements are reasonable, our forward-looking statements have been based on factors and assumptions concerning future events which may prove to be inaccurate. Those factors and assumptions are based upon currently available information available to Questerre. Such statements are subject to known and unknown risks, uncertainties and other factors that could influence actual results or events and cause actual results or events to differ materially from those stated, anticipated or implied in the forward looking information. As such, readers are cautioned not to place undue reliance on the forward looking information, as no assurance can be provided as to future results, levels of activity or achievements. The risks, uncertainties, material assumptions and other factors that could affect actual results are discussed in our Annual Information Form and other documents available at www.sedar.com. Furthermore, the forward-looking statements contained in this document are made as of the date of this document and, except as required by applicable law, Questerre does not undertake any obligation to publicly update or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.

This news release does not constitute an offer of securities for sale in the United States. These securities may not be offered or sold in the United States absent registration or an available exemption from registration under the United States Securities Act of 1933, as amended.

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 of oil 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.

This press release contains the terms "cash flow from operations" and "netbacks" which are non-GAAP terms. Questerre uses these measures to help evaluate its performance.

As an indicator of Questerre's performance, cash flow from operations should not be considered as an alternative to, or more meaningful than, cash flows from operating activities as determined in accordance with GAAP. Questerre's determination of cash flow from operations may not be comparable to that reported by other companies. Questerre considers cash flow from operations to be a key measure as it demonstrates the Company's ability to generate the cash necessary to fund operations and support activities related to its major assets.

For the year ended December 31,	2011		2010
Cash flows from operating activities	$ 10,595,507		$ 3,629,524
Net change in non-cash operating working capital	(532,570	)	1,115,036
Cash flows from operations	$ 10,062,937		$ 4,744,560

The Company considers netbacks a key measure as it demonstrates its profitability relative to current commodity prices. Operating netbacks per boe equal total petroleum and natural gas revenue per boe adjusted for royalties per boe and operating expenses per boe.

The Company also uses the term "working capital surplus". Working capital surplus, as presented, does not have any standardized meaning prescribed by GAAP and may not be comparable with the calculation of similar measures for other entities. Working capital surplus, as used by the Company, is calculated as current assets less current liabilities excluding the current portion of the share based compensation liability.