Quetzal Energy Ltd.
TSX VENTURE : QEI

Quetzal Energy Ltd.

December 03, 2010 16:30 ET

Quetzal Energy Ltd. Announces Third Quarter 2010 Results

CALGARY, ALBERTA--(Marketwire - Dec. 3, 2010) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE U.S.

Quetzal Energy Ltd. (TSX VENTURE:QEI) announces its unaudited results for the three months ended September 30, 2010.

HIGHLIGHTS of the quarter
  • To follow up on the Canaguay-1 oil discovery made in the third quarter, the Canaguay-1 well commenced testing multiple zones on October 6, 2010. The Canaguay-1 testing program included six drill stem tests of which five were completed as of the date of this MD&A. Included in the tests completed was a test in the lower Mirador that initially tested 2,225 barrels per day of 20.7 API crude oil. (See Press Release dated November 22, 2010). Quetzal Energy Ltd is the acting operator and is earning a 25% working interest in the Canaguaro block.

  • The Company completed the interpretation of the Llanos 27 block seismic and has identified several prospects including drillable locations. The drilling program is expected to commence in early 2011.

  • The Company closed a $C9.6 million equity financing on September 9, 2010 raising net proceeds of $C8.7 million that will be used to finance the company's exploration and development program and general corporate expenses.

Subsequent to the quarter end, the Company was successful in achieving credit approval from the Economic Development Corporation and the Royal Bank of Canada to back the Agencia Nacional de Hidrocarburos ("ANH") guarantees which removed the restriction on cash deposits of USD $4.9 million.

Financial highlights   September 30, 2010     June 30, 2010  
Cash and cash equivalents   $ 2,512,046     $ 1,111,190  
Petroleum and natural gas properties     35,768,446       32,836,833  
Total assets     48,379,543       41,286,221  
Total liabilities     9,345,249       10,538,258  
Share capital, warrants and contributed surplus     48,915,651       39,378,708  
Deficit     (12,653,101 )     (10,698,237 )
Working capital (deficit)     (359,822 )     (3,701,739 )
Net loss for the period (three months)     1,954,864       950,430  

Forward Looking Statements – Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of Quetzal, including, but not limited to the impact of general economic conditions, industry conditions, volatility of commodity prices, risks associated with oil and gas activities, currency fluctuations, dependence upon regulatory approvals, the availability of future financing and exploration risk. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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