Questerre Executes New Strategy During Environmental Assessment in Quebec

CALGARY, ALBERTA--(Marketwire - May 13, 2011) -

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

Questerre Energy Corporation ("Questerre" or the "Company") (TSX:QEC) (OSLO:QEC) reported today on its preliminary financial and operating results for the first quarter of 2011.

Michael Binnion, President and Chief Executive Officer of Questerre, commented, "The BAPE commission chose a more international approach to the development of our shale gas discovery, mandating a comprehensive strategic environmental assessment. We would have preferred a North American approach leveraging the extensive expertise of our industry that is successfully developing other shale plays across the continent."

Mr. Binnion added, "Within this two-year study period, we anticipate the province will develop the necessary internal expertise and regulations to allow us to begin commercialization of our discovery. In the interim, our focus will be to build our light oil assets in Antler into a core area with a production goal of about 2,000 barrels per day. We are also planning to add new projects to diversify our portfolio. Our recently formed new ventures team is selectively evaluating early stage shale opportunities with a near term focus on oil."

Highlights

• BAPE report recommends a strategic environmental assessment for shale gas development in Québec
• Shale gas incentives in conjunction with royalty increases are announced by Québec Ministry of Finance
• Completion equipment availability and inclement weather slowed the expanding program in Antler to grow light oil reserves
• Established new ventures group to evaluate high impact shale opportunities with a focus on unconventional oil
• Increased oil weighting resulted in positive cash flow from operations of $1.64 million with average daily production of 650 boe/d
• Maintained financial strength with over $130 million in positive working capital with no debt

For the first quarter of 2011, increasing oil production benefitted from higher oil prices and significantly improved operating results. The Company reported gross petroleum and natural gas revenue of $3.97 million for the quarter (2010: $2.98 million) with average daily production of 650 boe/d (2010: 600 boe/d). Higher capital investment in Antler, Saskatchewan in 2010 resulted in crude oil and natural gas liquids accounting for 69% of the Company's product mix (2010: 49%). Strong netbacks in this area contributed to cash flow from operations of $1.64 million in the quarter as compared to $0.52 million for the same period in 2010.

As at March 31, 2011, the Company reported a net working capital surplus of $130.62 million.

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 shale projects. The Company is leveraging its expertise to commercialize projects like its Utica shale gas discovery in the St. Lawrence Lowlands, Québec. Questerre is committed to the economic development of its resources in an environmentally conscious and socially responsible manner.

This news release contains certain statements which constitute forward-looking statements or information ("forward-looking statements"), including the scope and timing of future operations in Québec and Saskatchewan. Although the Company 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 the Company. 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 statements. As such, readers are cautioned not to place undue reliance on the forward looking statements, 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, the Company 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.

Cash Flow from Operations Reconciliation

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.