Questerre Energy Corporation

Questerre Energy Corporation

December 12, 2007 00:15 ET

Questerre Concludes 54 Square Mile Farm-In With Senior E&P Company

CALGARY, ALBERTA--(Marketwire - Dec. 12, 2007) - Questerre Energy Corporation ("Questerre" or the "Company") (TSX:QEC)(OSLO:QEC) is pleased to announce it has entered into a seismic and farm-in agreement with a senior Canadian exploration and production company covering 54 square miles in the Greater Sierra region of northeast British Columbia.

Michael Binnion, President and Chief Executive Officer of Questerre, commented, "This play is a perfect fit with our existing assets. It combines a well-developed primary target in the Jean Marie with several high potential secondary zones. We are very excited to be working with one of Canada's leading Jean Marie producers. I look forward to the spud of the first well before year-end and the commencement of our 3-D seismic program in early 2008."

The primary target on this land is sweet natural gas from the Devonian Jean Marie formation at a depth of approximately 1400m. The Jean Marie is an established resource play in northeast British Columbia with estimated cumulative production of 1.37 Tcf and over 1,500 producing wells.

Subject to the results from a 3-D seismic program and based on drilling in the surrounding acreage, Questerre expects to develop this horizon with, on average, two long-reach horizontal wells per square mile. Typical Jean Marie wells recover between 0.8 Bcf (133,000 barrels of oil equivalent ("boe")) and 1.7 Bcf per well (283,000 boe) with initial rates between 1mmcf/d (166 boe/d) to 2 mmcf/d (332 boe/d). The land is also prospective for natural gas from both shallow and deeper horizons.

Pursuant to the farm-in agreement, Questerre will fund the acquisition of a 46 square mile 3-D seismic survey. Questerre will also finance the drilling, completion and testing of two wells targeting the Jean Marie formation this winter. Upon completion of its earning commitments, Questerre will have a 50% interest in all the acreage. The majority of these costs are expected to qualify as Canadian Exploration Expenditures and will meet the Company's flow-through commitments for 2007 and 2008.

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.

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.

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.

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