Questerre Energy Corporation

Questerre Energy Corporation

October 16, 2006 00:15 ET

Questerre Elects to Participate in Talisman Gentilly #1

CALGARY, ALBERTA--(CCNMatthews - Oct. 16, 2006) - Questerre Energy Corporation ("Questerre" or the "Company") (TSX:QEC)(OSE:QEC) announced today that it has formally elected to participate in the Talisman Gentilly #1 well to be drilled by Talisman Energy Canada ("Talisman") later this year. The well will be drilled in the St. Lawrence Lowlands in the parish of Gentilly near Trois Rivieres, Quebec.

The well will be licensed to the Potsdam formation and is expected to test multiple exploration targets. Expected total vertical depth for this well is estimated at over 2600m.

Pursuant to the farm-out agreement with Talisman, Questerre has the option, after a review of technical data and interpretations made by Talisman, to participate in this well. As a result of its election to participate and its carried working interest, Questerre will pay 10.5% of the well costs and have a 17.5% working interest in the well. Questerre will also receive an overriding royalty on any production from the well.

Michael Binnion, President and Chief Executive Officer of Questerre, commented, "This well will test the first of several prospects we have identified on our acreage. With multiple zones being tested, we believe our chances of discovering hydrocarbons is greatly enhanced. We are pleased to be increasing our working interest by participating in the well."

Questerre's two minority partners, including Terrenex Acquisition Corporation ("Terrenex"), a related company, and a private exploration and production company, have also elected to participate in this well for their proportionate share. The partners will be farming out their interest on the same terms and conditions as Questerre.

Terrenex is a public investment company listed on the TSX Venture Exchange. Terrenex currently holds 10.7 million common shares of Questerre representing 7.6% of the issued and outstanding share capital of Questerre. All of the directors of Terrenex serve as directors and officers of Questerre.

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.

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